Happy New Year! We hope that everyone had a wonderful holiday season.  It is hard to believe that it is 2020.  We are in a new decade! I am sure many of you are already thinking about all of the goals you want to accomplish by the end of the year.  If you are like me, maybe you want to exercise more, travel more, or eat healthier.  As you begin to set your goals for the year, how about creating an estate plan?

The beginning of the new year is a great time to create a comprehensive estate plan or to review an existing plan to make sure it is up to date.  Documents that were created many years ago may need updating when your family and financial situation have changed entirely.

Very often when I meet with individuals and families, I find that there is still some misinformation about estate planning.  Therefore, in this month’s newsletter, I thought it would be a good idea to discuss the essentials of a comprehensive estate plan.

These documents include the following:

  1. Power of Attorney. A power of attorney is one of the most important estate planning documents because it allows you to appoint someone to act in your place for financial purposes. Without a power of attorney, your family would be unable to pay your bills or manage your household without going to court and getting a guardianship, which can be time consuming and expensive.
  2. Health Care Proxy. A health care proxy, allows you to choose someone else to make health care decisions on your behalf, if you are unable to do so yourself.  A health care proxy will ensure that your medical treatment instructions are carried out.
  3. Advance Directive or Living Will. Advance directives and living wills explain what type of care or treatment you would like if you are unable to direct your own care. An advance directive may contain directions to refuse or remove life support in the event you are in a coma or a vegetative state or it may provide instructions to use all efforts to keep you alive, no matter what the circumstances.
  4. Last Will and Testament.  Your will says who will get your stuff when you die and who will be in charge of paying your bills, filing your tax returns, gathering your stuff and distributing it according to your instructions.  But here’s the irony: although the will gets all the recognition and there’s a whole set of laws governing the so-called “probate” process, these days most assets pass outside of probate. What the will says does not apply in many situations, including: joint accounts that pass to the other joint owners, retirement plans and life insurance policies that go to designated beneficiaries, and property in trust that passes to the beneficiaries named in the trust document.
  5. Trust.  The documents listed above may be enough, but you may also need a trust. A trust allows you to appoint someone, the “trustee” to manage the property transferred to the trust for the benefit of one or more people, the beneficiaries. A trust can protect and preserve your assets, especially when planning for long-term care and eliminate the need for probate by naming successor beneficiaries after the initial beneficiary passes away. Avoiding probate can save heirs time and trouble.

As you can see, most of these documents are about life not death. As you begin to set your goals for the year, it’s important to remember one thing….you.  One of the best ways to care for yourself is to create your estate plan.

Please contact our firm now if you would like to learn more.  We would be happy to work with you.