We don’t usually expect an accident, the loss of a loved one, the loss of an income, but life can throw a curveball now and then, so it’s prudent to be prepared.
Whether you have an estate worth millions, or your biggest asset is your car, creating an estate plan is a way to ensure that your assets are distributed according to your wishes.
An estate plan usually includes: a will, power of attorney documentation, a living will, and other possible elements like a medical power of attorney, sometimes called a healthcare proxy.
It’s smart to get professional help in estate planning. Your bank should offer wealth management options that allow you to create different kinds of estates or trust funds. Talk to an estate planning professional to make sure your estate is in compliance with all laws and regulations.
Estate Planning Documents
When you sit down with an estate professional, be prepared to answer a lot of questions about distribution of assets and how you want medical services delivered if you become incapacitated.
No one likes to think of these things, but look at it this way. By getting your estate in order now, you eliminate unnecessary headaches for heirs down the road, and getting your financial house in order now is a lot simpler than it would be if your assets end up in probate court.
A last will and testament is part of an estate and describes how you want assets distributed to relatives, friends, charities, and other recipients of your generosity. Without a will, your assets may be divided up by a probate court, and how assets are distributed may not be to your liking. Creating a last will and testament simplifies asset distribution to heirs according to your directions.
Assign power of attorney. When you’re not here, you want a trusted relative or friend to look after your finances and legal responsibilities. If you don’t assign power of attorney to a trusted individual, your assets can be tied up for months. Choose a trustworthy relative or friend to give power of attorney, discuss your wishes, and know they’ll be followed.
Some estates include a revocable living trust. A revocable trust is another means to skip the time and expense of probating your assets. It’s revocable, which means you can change it as your circumstances change. A revocable living trust requires a trustee to oversee trust activities. You can choose a trusted relative or friend, or designate your attorney as trustee. A trust can be used to distribute assets at any time, unlike a will, so there’s more flexibility in personal money management. Consider adding a revocable living trust with help from your financial advisor, legal counsel, or a trust professional at your bank.
A living will defines how you want to be treated if you become medically incapacitated – something that can happen at any age. It allows you to put in writing just how much medical care you want under a variety of circumstances. A living will enables you to control how you’re treated, while eliminating the difficult decisions for loved ones. A living will also assigns power of attorney to someone you choose, who then follows the directives laid out in the living will. In Nevada, the Secretary of State provides online living will forms that you can prepare yourself and keep on file in a digital Living Will Lockbox that can be accessed by healthcare professionals.
Create a list of all key documents not covered in your will. Life insurance policies, for example, should be reviewed, beneficiaries updated, and insurer contact information provided. You may have other documents laying out funeral plans, and other personal matters not covered in any other estate document. Create a list of all important documents and how to access them, and leave a copy with a trusted family member or your attorney. This will save a great deal of time and energy for heirs and others working to make sure your wishes are followed.
By preparing documentation now, you can save your loved ones time, money, and frustration by getting your assets in order, your estate in writing, and your plans for the next generation in place.
The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice.
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