What estate planning documents do you need?
No one wants to think about life after their death, but the fact is, estate planning is a critical part of protecting your family and finances. Without a plan, your family may not fare well after you pass. Having your important documents in place can ease your family burden, and protect your family and your estate after you are gone. The following is a look at which documents you need, and why:
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1. Will. A will is the legal way for your final wishes to be carried out. It illustrates things like inheritance, and helps your family know what you wanted. A will may indicate how you want your burial taken care of, etc. Many people avoid putting together a last will and testament because they are concerned with, or unable to afford the legal fees. However, today there are online sites and attorney free options for putting together your will in a matter of minutes.
2. Living will. This is also known as a medical or healthcare directive. In other words, if you become incapacitated, but are still alive, and you can't give a directive about your healthcare because you are unable, not in your right mind, etc. this is a document that tells your family or loved ones what you want to do. If you are a vegetable, should they put you on life support, or pull the plug? Do you want your organs donated?
3. Durable power of attorney for finances. This is a document that gives the power to make your financial decisions, and control your funds to someone else if you are incapable or passed on. The reason you want to create these papers while you are young, healthy, etc. is because as you age your faculties may not be as together.
4. Durable power of attorney for healthcare. This is often called a medical power of attorney, or healthcare power of attorney. Again this is a document that gives someone else the power to make decisions for you when it comes to your healthcare if you are unable.
5. Living trust. This document is a trust created during a person's lifetime to either save money on taxes or setup long term property management and asset management so that all goes smoothly after they pass on. Living trusts are designed to avoid probate, and are more typical for people with large or great deal of property.
These are the documents that are set up to safeguard your future, family, and finances. While they can cost you some money to prepare legally with an attorney, they will save your family a lot of heartache and trouble after you pass on. This is an important part of estate planning, and if you have children, or property, these items are important to get started early on. You can evaluate them, review them, or change them yearly.
