Estate planning is important regardless of your age, income, assets or health. Many people procrastinate about planning for the distribution of assets in the event of their death. Some people feel they don't have enough money or personal belongings to justify executing a Will. Others think they are too young or in too good of health to start planning for their death. However, estate planning involves more than deciding who you want to inherit your belongings when you die.
At minimum, estate planning requires executing basic legal documents to protect your loved ones. Everyone should draft a Last Will and Testament; Power of Attorney; and Living Will or Healthcare Proxy.
A Will is one of the most important aspects of estate planning. This document allows you to designate an Estate Administrator to ensure your directives are adhered to. The Administrator plays an important role and is responsible for numerous duties. The person appointed to this position should be adept at finances and able to make difficult decisions during stressful events.
Estate executors will work closely with the estate planning lawyer. Duties include providing documentation of life insurance policies, outstanding debts, financial holdings, and filling out legal papers to close the estate.
Creating a Will is relatively simple. Preformatted Wills can be purchased at office supply stores. Simply fill in the blanks; have the document witnessed and notarized; file the original copy in a safe location; and provide a copy to the designated Administrator.
Executing a Last Will and Testament is particularly important for people who have minor children. Using a Will, guardianship can be established in the event of their parents' death. If guardianship is not established, the court will decide where the children will reside until they are of legal age. Oftentimes, this is not the choice the parents would have made.
Power of Attorney is used to authorize a designated agent to manage your financial affairs if you are unable to do so. The designated agent should be someone you can fully trust. Prior to establishing POA, experts suggest discussing the matter with the person you would like to designate. Doing so can prevent future problems should the individual be unwilling or unable to take on the role.
Living Wills or Healthcare Proxies document the type of medical care you do or do not want to receive if you were to become critically ill and unable to communicate. Healthcare proxies allow you to state whether you desire life-saving medical treatment such as resuscitation, life support, or nutrition.
Just as with POA, you want to select your healthcare agent carefully. Being a healthcare agent is a difficult duty and requires someone who can make crucial decisions on your behalf.
Published on January 25, 2009 at 10:09 AM
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