Estate Planning

What is an estate plan?  Many people think that the terms "estate" and "estate planning" only apply to the wealthy, so they do not protect themselves with estate planning tools. This misconception can be financially and emotionally devastating to those families that have not protected themselves with proper estate planning. An estate simply refers to the total of your assets, be it modest or extensive. The main goals of Estate Planning are to protect an individual's assets throughout their life, to clearly identify proper ownership of those assets after an individual's death and to minimize the cost of the transfer of those assets to loved ones. Estate plans should be as individualized as the people they protect and can always be revised or revoked throughout an individual's lifetime.

Estate Planning Tools:  Basic Estate Planning utilizes a variety of tools and services to protect you and your loved ones. Everyone should have a number of these documents in place, regardless of economic status or age.

1.  Wills:  A will, also known as a “last will and testament” is legal documentation of a person's desires for the transfer of their property upon their death. A will also outlines specific people who are to be named as guardians of their children or as the executor or personal representative of the estate.   You should legally document who you would like to leave as guardians of your children and trustees to your estate.  A trust within the Will could also identify when and how you would like your assets transferred to your children, which could be at any age and in almost any manner that you wish.

2.  Powers of Attorney: A good estate plan also includes protection of you and your assets before death as well as after. Preparing a good estate plan, you must consider the possibility that someday you may be unable to make decisions for yourself, care for yourself or even become incapacitated. If this should happen there will still be a variety of things that will need to be managed, such as your health care decisions, bills, taxes and assets. This is where the powers of attorney protect you. The power of attorney is when one person (the principal) grants legal rights and powers to another (the agent). There are two main types of powers of attorney that most American's benefit from.

• Durable Power of Attorney: A special power of attorney called a durable power, gives you the legal right to name an agent to act for you in the event that you become incapacitated. Some of these powers may include writing out checks and signing for you to pay monthly bills, authorizing business transactions, etc.
• Medical Power of Attorney: If you are unable to make decisions for yourself due to being incapacitated, this power of attorney grants rights and powers to your chosen agent to make medical decisions upon your behalf. Should you become incapacitated and without a medical power of attorney, a host of issues concerning your medical treatment will arise.   The alternative to having this document, applying for guardianship of an incapacitated loved one through the state court system, can be time consuming and very emotional. Protect yourself as well as your loved ones and prepare a medical power of attorney and communicate with your chosen agent about your medical treatment wishes.

3.         Living Will: A living will, also known as an “advanced directive” is a legal document given to your health care providers that establishes your preferences regarding “end of life decisions” in the event that you are unable to communicate these desires yourself. You may specifically indicate your preferences for organ donation, lifesaving measures to be used, life support systems to be enabled and other choices that will otherwise be made by your next of kin, who may or may not want to be in that position. This document should not be confused with a medical power of attorney, which is more extensive. However, this document is an important part of an estate plan.