Estate planning allows you to determine exactly how you want your assets to be managed after your death. It also provides instructions on how to manage your assets, property and health in the event that you become incapacitated while still alive. A good estate plan should always includes certain components to protect you and your assets.
Estate planning should include a will or trust
Estate planning should provide a way to protect your assets and determine how you want them to be distributed. Both wills and trusts allow the distribution of your assets. The primary difference between trusts and wills is that probate courts administer wills, while trusts allow your heirs to skip the probate court process.
Estate planning should include a durable power of attorney
If something should happen that causes you to become incapacitated, you will still have financial obligations. When you appoint a durable power of attorney as part of your estate plan, you allow that person to take care of your finances while you are unable to do so yourself. This includes common financial tasks, such as:
• Managing your bank accounts
• Filing your taxes
• Handling your bills
• Making investment decisions
• Selling or buying property
You should appoint both a medical power of attorney and a living will
If you become incapacitated, you will not be able to make medical decisions yourself. Naming a healthcare or medical power of attorney allows you to choose someone you trust to make those decisions for you. Living wills clearly state your medical wishes and are especially important for expressing your wishes about resuscitation orders.
Estate planning can always include additional components
If you have complex assets, you may wish to add more estate planning components. To help make sure that your assets, beneficiaries, and wishes are protected, you should begin your estate plan as soon as possible.