People tend to think that estate planning is about what happens to us after we die. It is that, of course. You want to provide for your family or preserve your legacy and we can give you the legal tools to make that happen.
But estate planning dramatically affects what happens to you while you are living. What would happen if you were physically or mentally unable to handle your affairs – or even if you were just traveling out of state and an emergency came up? Protect your family and your property in these cases with a general durable power of attorney for financial decisions.
If you were injured or terminally ill and not able to speak for yourself, what would happen? A living will is the right tool to make sure doctors and hospitals know what you want and don’t want. A patient advocate designation form will make sure that there’s a person authorized to speak on your behalf.
BASIC ESTATE PLANNING DOCUMENTS
Last will and testament (will): A will is a legal document that states your final wishes. It lets you tell the world who should receive your assets after your death. It also allows you to name a guardian for your minor children. Without a will, the courts decide what happens to your assets and who is responsible for your kids. That involves a probate court and a legal process that can be expensive and drawn out to determines who inherits your estate, and can take anywhere from a few months to a few years, depending on how complicated the estate is. Examples of typical probate property are houses, cars, furniture, stocks, bonds and bank accounts.
Trust (living trust): A trust is a legal entity created to hold your assets. There are several types of trusts available. A trust does not eliminate the need for a will. With a living trust, you place your assets (home, bank accounts, etc.) into the trust. They are administered for your benefit during your lifetime and then transferred to your beneficiaries when you die. Common objectives are to reduce the estate tax liability, protect property in your estate and to avoid probate.
Durable power of attorney for health care (living will): A living will is a legal document that allows you to express your wishes to doctors in case you become incapacitated. It makes known your wishes regarding life-prolonging medical treatments. In a living will, you can outline whether or not you want your life to be artificially prolonged in the event of a terminal or devastating illness or injury. A patient advocate designation form allows you to select a patient advocate and successor patient advocate to act on your behalf when you are incapacitated.
General durable power of attorney (power of attorney for financial decisions): A legal document that allows you to immediately appoint a person to handle your affairs when you are unavailable or unable to do so. Typical situations include when you are traveling out of state or if you become physically or mentally unable to handle your affairs. The person you appoint is referred to as your “Agent” and they are required to act in your best interests. A springing durable power of attorney does not take effect until you become disabled or incompetent. No matter which type is selected, the agent’s powers end when the person is no longer living. Those powers may include:
- Handling financial or banking transactions, entering safety deposit boxes
- Buying or selling stocks, bonds or securities
- Buying and selling personal property or real estate
- Settling claims, filing lawsuits, entering into contracts, filing tax returns,
- Handling business affairs and tending to matters related to government benefits.