Nearly everyone, including you, has an estate. Everything you own — your home, other real estate, checking and savings accounts, car, investments, life insurance, furniture, personal possessions, etc. — make up your estate. Regardless of how large or modest, everyone has an estate and can plan ahead to ensure their wishes for their property are met. Estate planning not only clearly identifies what will happen with your property and interests once you are not able to make those decisions, but also alleviates additional burden to your loved ones in a difficult time.
What is an estate plan and do I need one?
An estate plan is a roadmap to manage your assets if you become incapacitated and to distribute your assets at your death. A plan can be very simple, like a will, or involve one or more trusts and related documents. Most people do need an estate plan. The type of estate plan you need depends on your assets and your discretion about who should receive your assets.
What is a will?
A will is the legal statement of a person’s last wished as to the disposition of their property following their death. It instructs the probate court how to distribute your assets after all debts, taxes ans costs of administration are paid.
What is the role of an executor?
The executor has three main jobs:
- Compile assets of the estate;
- Manage payment of the valid outstanding debts of the estate; and
- Guides the estate distribution in accordance with the terms of the will.
How often should I update my will or estate plan?
It is a good idea to revisit and update your will and/or estate plan every few years. Additionally, it is a good practice to revisit your plans after significant life events such as marriage, divorce, the birth of a child, or adoption.
Even outside of such life events, changes in tax laws or changes in your financial situation that requires a reevaluation of your estate plan.
What estate planning documents to most people need?
- A will, and in certain circumstances, a trust
- Healthcare Power of Attorney: This designates a person to make medical decisions on your behalf if you are not able to do so. You can also authorize this person to discontinue (or not start) life support procedures, if you are terminally ill or in a persistent vegetative state. If you do not wish to be kept alive by extraordinary means if you are terminally ill or in a persistent vegetative state, this document states your wishes.
- Durable Power of Attorney for Assets: This document enables the person you identify to deal with your property, as you would, during your lifetime.
- Hippaa Certification: This document nominates a person to have access to your medical records.
- Digital Assets Authorization: This document allows your Power of Attorney to access your online accounts.
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