The topic of estate planning is often something people are uncomfortable discussing or even thinking about. However, creating an official and legalized plan ensures that your wishes for the distribution of your assets are carried out when you die, and it ALSO means you’ll be prepared if you have a life crisis or become ill.
Any estate plan will minimally comprise a Will, Financial POA, Health Care POA with HIPPA, Health Care Directive and Mental Health Directives. However, if married, you should strongly consider a Community Property Agreement. If you are married and have a net worth more than $2.2M then consider a Trust to eliminate estate tax. If you own property in more than one state or wish to avoid probate, you should consider a Living Trust.
Let’s look at some of these Elements of Estate Planning. And you can always learn more on our website HERE.
Last Will and Testament
An estate plan commonly includes a last will and testament, commonly known as a Will, which outlines your wishes for the assets that you own at your passing and allows you to name the people you'd like to leave something to upon your death. Click to learn more about Wills.
Without a Will, your assets follow a process called probate, in which the state determines how your assets are distributed based on state law. A Will allows your assets and family to skip the probate process and be distributed as you wish.
It is best to create or update your Will when you have significant life changes, such as getting married or divorced; once you have a child it is imperative to create a Will and establish a chain of legal guardianship for your child if something were to happen to both parents. Learn more about Wills HERE.
Healthcare Power of Attorney and Living Will
A healthcare power of attorney (HPOA) is a signed legal document in which you name a single person as your healthcare decision-maker in the event that you can’t make decisions for yourself.
A living Will, also known as an advanced medical directive, outlines your wishes regarding medical care in the event that you are incapacitated, terminally ill, or unable to communicate. This is a statement of your wishes as they relate to decisions about life support and any kind of life-sustaining medical intervention that you do or don't want.
It is generally best to get these documents drawn up at the same time as your Will. Learn more HERE.
Financial Power of Attorney
Similar to the healthcare power of attorney, a financial power of attorney outlines who you want to make financial decisions on your behalf should you become incapacitated. Without this document, no one will have the authority to step in and handle bill-paying, investment decisions, or other financial matters.
Like the HPOA, it’ best to create this document at the same time as your Will. Here at Tacoma Elder Care Bob Michaels has a package that handles the essential Six (6) Documents you need. Learn more about the documents and how to start HERE.
Establish a Trust
A trust is a legal entity that can own your assets (while living or at death) and be controlled based on your wishes outlined in the legal document that created the entity. For example, a trust would allow you to dictate how you want your children or a partner to benefit from your assets throughout their life or upon your death.
You may want to include stipulations that assets are used in a certain way or received at a certain time. A trust is a way to protect assets from being used in a way that you would not see fit if you were in control of them.
Trusts can also be set up as care mechanisms for the elderly, periodic income for descendants, or to be used for certain expenditures or circumstances.
If you have a sizeable insurance policy or estate and/or children, a trust is worth discussing with an attorney to determine the right parameters and language for your situation. Learn more HERE.
Estate Planning Is Essential
Is your estate planning in order? If not, you should consider getting these important documents in place as soon as possible. You want to ensure that your assets are distributed and that your descendants are cared for in the manner that is best for them when you are gone—while assuring yourself you've done all you can.
Whether you’re ready to start pre-planning or facing a crisis and trying to figure out what to do next, Bob Michaels with Tacoma Elder Care is here to help. To get started today or to learn more about what we do, schedule an appointment today!
Bob Michaels is extremely passionate about providing the best possible legal experience for his clients, and focuses his practice on elder law, estate planning, business, and real estate matters. Bob specializes in helping folks build a long-term care plan based on their circumstance. If you are considering a long-term care plan, schedule your appointment today!
This article is an abridged and edited version of one that originally appeared HERE.