Making an estate plan now helps ensure that your wishes will be carried out, lightens the burden on your family, and gives peace of mind for the future. Estate planning today goes beyond writing a will. You should consider how assets will be distributed, who will make medical decisions if you cannot, who will take care of your minor children or pets, and more. Here are a few of the most common estate planning devices used to ensure your legacy.
Last Will and Testament
A will is a legal document that describes who will receive your money and property after you pass away. In the will, you can appoint someone you trust to help distribute and manage assets to your beneficiaries (the people to whom you leave your money and property). If you currently have minor children or anticipate having children soon, your will can provide for their care and upbringing.
Without a will that meets legal requirements, your estate will be distributed to your relatives according to a legal formula. You will have no say in who inherits or who cares for your minor children. No matter how small your estate, a will can prevents assets from being wasted.
Many people think that they only need a will, that handwriting a will is sufficient, or that signing a printed form from the Internet will take care of all of their estate planning. In most cases, this is not true. Several other legal documents are commonly used and help address concerns that many people have, such as who will make health care decisions for them.
A trust is a legal document that assigns a responsible person, known as a trustee, to watch over money or property for the benefit of another person, known as a beneficiary. Some trusts allow interest or income that the trust property earns to be distributed to the beneficiary over time. Trusts can be powerful tools to use along with a will to protect your assets, direct where money goes, and manage tax issues. Many people who choose to use trusts have elderly relatives or spouse, children who are not yet ready to manage money, or are caretakers for ailing or handicapped persons.
Durable Power of Attorney
A durable power of attorney is a legal document designating a person to take legal and business actions on your behalf if you are incapacitated (meaning physically or mentally incapable of doing so yourself). Usually, the designated person is a spouse, trusted relative, or close friend. Once the durable power of attorney goes into effect, this person can manage bank accounts and sign legal documents for you, ensuring that your business and personal affairs move forward.
Medical Power of Attorney
Should you become seriously ill and unable to make medical decisions for yourself, you may have a specific person you want to make those decisions. A medical power of attorney legally designates and authorizes that person to make healthcare choices for you and to communicate with medical staff. It is one type of advanced care directive. Medical powers of attorney can become especially important for people with Alzheimer’s, dementia, degenerative diseases, or other serious health issues that may result in their incapacity.
Similar to a medical power of attorney, a living will explains your choices for end-of-life medical care and designates a person to make sure those choices are carried out. The living will may contain specifics such as when you would like life support to be discontinued and whether you want a member of clergy to visit or Last Rites to be said. Living wills, like medical powers of attorney, also can protect doctors and healthcare staff from liability if you want medical care to cease at a certain point.
Generally, your medical information is private to you and your doctors. HIPAA, the Health Insurance Portability and Accountability Act, is a federal medical privacy law that penalizes disclosure of your information – even to relatives and friends. If you have appointed someone to make decisions about your healthcare should you be unable, you will need to authorize them to receive medical information using a HIPAA authorization.
Have you planned your estate and signed a will or power of attorney yet? Attorney Vivian Ross-Bennett and her team quickly and efficiently help people with all sizes of estate ensure that their wishes are carried out. Entrust your will, trust, and power of attorney issues to a professional by calling Vivian Ross-Bennett at (512) 330-4099 or emailing her to set up an appointment