Elements of Successful Estate Planning

This is a topic that many people might be a bit uncomfortable talking about, but that doesn’t make it any less essential. Most people might not want to think about what happens after death, but we must do so if we have any financial assets or possessions that we’d like to leave to our family members and friends. Creating a legal and official plan means your possessions will be distributed in the way you desire.

There are a few key elements to an estate plan. Let’s take a quick peek at them.

Trust

This is a legal entity that can essentially own your assets. It’s controlled according to your wishes outlined in the legal document responsible for creating the entity. For example, an irrevocable trust would let you dictate how you wished for your children to benefit from any assets you owned throughout their life. They can also be used as care mechanisms for elderly people, certain circumstances or expenditures, or periodic income for your descendants.

Last Will and Testament

A plan for your estate typically includes this document, also known as a will, which outlines how you want your assets to be overseen once you die. A lawyer can help you set one up. This document allows you to name any people you want to leave something to after your death. In most states, if you don’t have a will, your assets will have to go through probate, where the state will determine what to do with your assets. Having a will means that your family and your assets can skip the process of probate and be done with it.

Financial Power of Attorney

This document outlines who you desire to make all of your financial decisions for you if something happens and you become incapacitated. Without a Power of Attorney, nobody will have the authority required to step in and take over paying bills, make investment decisions, and take care of other financial matters. It’s best to make this document when you make your will. If you have large financial assets or specifications that need detailed documentation, it’s time to see an estate planner.

Living Will

An HPOA (Healthcare Power of Attorney) is a signed legal document that’s used to name a single person to make decisions about your health in the event that you become incapacitated to the point where you can’t do so yourself. This is also known as an advanced medical directive or a  Living Will. It outlines your wishes regarding your medical care if you become unable to communicate, terminally ill, or in any way incapacitated. This is essentially what your wishes are as they deal with decisions about life-sustaining medical intervention or life support you may or may not want. Again, this should be created when you’re drawing up your will. If you happen to have a set of specific requirements that necessitate detailed documentation, an estate attorney is the type of lawyer you need.

Have you already gotten your estate planning in order? If you haven’t, you might want to think about making sure these critical documents are taken care of as soon as you can. You need to make sure your assets get distributed as you wish and that your dependents are cared for by who and how you want or how you think is best if something happens to you. This will assure you that you’ve done your best to ensure their future and can give you more than a little peace of mind for when the eventual happens.

Justin Weinger

A married father of three, Justin Weinger works in private equity as a Corporate Finance Manager, he is also an avid blogger and personal finance enthusiast with a strong history of working in the automotive and publishing industry.