When you are making an estate plan, it is often difficult to know exactly where you should start. There are a lot of different instruments you may need depending on your goals for your legacy and your specific family situation. Still, there are a few basic instruments that just about everyone should make sure to have in place. Here are three of the most crucial estate planning instruments that just about everyone needs:
1. A Last Will and Testament.
Recently, a Yahoo article revealed some troubling statistics. The article said that while 56% of people believe that having an estate plan is important, only one-third of adults have actually created a plan. This included one of the most critical and basic documents of all: A Last Will and Testament.
The purpose of a Last Will and Testament is to express how you want your wishes carried out after your death and who should be in charge of ensuring that your wishes are carried out. This applies to the distribution of your assets as well as the care of your minor children or pets you own.
When you create a Last Will and Testament, you are able to designate an executor to oversee your estate. You can also designate caregivers for pets and guardians for minor children. Without a will, you won’t have a say over how your assets are distributed. Instead, most states have laws that govern who is entitled to inherit when someone dies without a Will. These laws are generally referred to as the laws of intestacy.
It’s important to make sure your Will contains all of the appropriate information, including your legal name, your marital status, and the names of your dependents. It’s also important to be clear about how you want your assets distributed. If you have items of value, make sure to list each one individually in your will so they go to the right people. With that said, a Last Will and Testament typically requires a probate proceeding with the local probate court. To discuss options that avoid probate, contact us at (281) 759-3213.
2. A Power of Attorney.
A Power of Attorney is an instrument that authorizes another person to make financial and/or health-related decisions on your behalf in the event that you’re unable to make those decisions yourself. Durable Powers of Attorney remain valid once you’re unable to make decisions for yourself.
A durable power of attorney is important because it ensures that your best interests are put first in the event of an emergency. You should make sure you have a durable power of attorney for financial decisions as well as one for medical decisions.
The person you appoint to handle financial or health-related matters in your power of attorney does need to be an actual attorney. Many people choose to designate a family member to make medical decisions in particular.
Without a Durable Power of Attorney, if there’s a situation where a quick decision needs to be made about your care, your loved ones may not have the authority to do so. In that case, a court may need to intervene and appoint a guardian or conservator to act on your behalf. Most people, however, would rather have a trusted person they appointed to make medical and financial decisions for them.
3. An Advance Healthcare Directive.
An Advance Healthcare Directive is a legal document that specifies your preferences for medical care in the event that you can’t make those decisions yourself, whether due to an injury or an illness. Advance Healthcare Directives help ensure that your wishes are carried out. It can also remove the burden from your loved ones of needing to make potentially difficult choices.
Advance Healthcare Directives address scenarios such as whether you would want to be resuscitated after a catastrophic medical event or toward the end of a terminal illness. It should also dictate whether you want interventional treatments like ventilators or feeding tubes in the event of a major illness or injury.
Some people do use the terms “advance healthcare directive” and “living will” interchangeably. However, a living will is actually part of an advance healthcare directive. It can include instructions for end of life care as well as what religious practices, if any, you might want incorporated into your care.
The right estate planning instruments give you peace of mind and ensure there’s no confusion about how you want your wishes carried out. This applies to everything from your financial resources to the medical care you receive. If you need assistance creating an estate plan, The Mendel Law Firm, L.P. estate planning attorneys are here to help. Reach out to us at (281) 759-3213 or contact us online to discuss your estate planning needs.
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