All adults, despite whether they are married, have children, or have a large net worth, will benefit from preparing at least an estate plan. You will want estate planning in place in case you become temporarily or permanently incapacitated, or unable to make these decisions or care for yourself due to various mental and physical issues.
There are a few documents that everyone needs. A basic estate plan includes a Will, Durable Power of Attorney, Health Care Power of Attorney, and Living Will. The Will serves to designate beneficiaries for your property and name guardians for any minor children. The Durable Power of Attorney allows you to assign an agent to handle your finances while you are incapacitated. The Health Care Power of Attorney allows you to assign an agent to make medical decisions on your behalf. Finally, the Living Will provides medical personnel with instructions regarding your end of life decisions. Further, many individuals also include HIPAA authorizations in their plan to give family and friends that are not named in their Health Care Power of Attorney access to medical records. This basic estate planning also serves to remove much of the burden from your surviving family member’s shoulders during already difficult times.
There are several key issues that we all need to consider while we have the capacity to prepare and implement a basic estate plan:
- Who is going to handle your financial affairs (e.g., paying your bills, collecting income, selling property, etc.) when you are incapacitated? For example, who is going to make sure your mortgage or rent is paid if you are in the hospital following an automobile accident?
- Who is going to be permitted to visit you in the hospital and make medical decisions on your behalf when you are not able to make decisions on your own?
- When you pass away, who will receive your property? How and when will they receive this asset?
- If you pass away while your child or children are minors, who will be their guardian(s)?
The questions listed above are complex issues and nearly everyone will be impacted by each of them at some point during their life. If you do not plan, the state will make the decisions for you. Often, the state’s decisions will be more expensive than the cost of basic planning. Furthermore, the likelihood that the state will make the same decisions that you would have made for yourself is very slim. The court will choose your fiduciaries based on your state’s law, which may not be the best people to serve as your fiduciary. For example, if you are unmarried and would like a close friend of yours to serve as your fiduciary, the court will not choose this person because it is not in accordance with the law. Instead, your fiduciary may be a sibling who you may believe to be unsuited to fulfill this important role.
Again, you do not need to be wealthy for it to be beneficial to have an estate plan in place. Implementing an estate plan will reduce your family’s stress and ensure that your wishes will be fulfilled.
If you would like to discuss your estate planning needs, contact us. We will be more than happy to schedule an initial meeting with you.