The estate planning process can seem formidable. If you’ve been putting off having a will prepared or discussing your estate plans with an attorney, don’t. The sooner you put a plan into effect, the safer you are against potential problems down the road. Estate Planning Important for Anyone Over 60 for a variety of reasons. For families, a will can outline details such as who will raise minor children, and a trust can put funds in place to raise them. For business owners, a trust can protect the business.
What Happens If You Don’t Have an Estate Plan?
If you never put together at least a basic estate plan, such as a will and an advance directive for health care, the state will make some decisions for you. If you are disabled and can’t take care of your assets, the court will assign someone to care for them. Your family won’t have access to them or any control over them.
If you die, your assets will be distributed according to state law through the probate court. In some states, they will be divided between your spouse and children. All assets are distributed according to strict guidelines, with no consideration for sentimental objects, or who should get what. Your spouse may not be left with enough for a comfortable life.
For seniors, an estate plan serves fa variety of purposes, including protecting them before and after death.
Protecting Your Finances While Alive
Think about what you might need if you become incapacitated by an illness or injury and end up living in assisted living or a nursing home for any length of time. Will you have the funds to do so? A financial planner or estate planning attorney can help you evaluate your finances. They can help you determine whether you might need additional insurance or more life insurance to provide for your spouse or heirs.
A Financial Power of Attorney is a way to protect your assets if you are disabled and can’t make decisions about your investments or access your accounts. With this legal document, you can designate someone you trust to take care of your finances for you. They can pay your bills and make sure no one takes advantage of you financially.
Protecting Your Health & Safety
A Healthcare Power of Attorney, Living Will, or Advance Director are documents that are often part of the estate planning process. These documents give the person you choose the power to make healthcare decisions in your name if you are incapacitated. A durable power of attorney means it is only in effect as long as you cannot make decisions for yourself. Once you recover, all control to make these decisions reverts back to you.
Your Healthcare or Medical Power of Attorney, Advance Directive, or Living Will should outline what extreme lifesaving measures you want to be taken if you are injured or ill. Some issues commonly addressed in these legal documents include feeding tubes, life support, and respirators. Do-Not-Resuscitate orders may also be included. If you have strong preferences regarding your end-of-life care and who will make these decisions for you, you must include these documents in your estate planning.
Protecting Your Finances For Your Heirs
Regardless of who you plan on leaving your assets to, having a solid estate plan in place will protect your heirs and beneficiaries from high probate costs, litigation, and lengthy court proceedings. A last will and testament outlines who should inherit personal property, real estate, and bank accounts. Trusts are another way to pass on funds and property to bypass probate courts and the cost involved. If you have life insurance policies and retirement accounts such as IRAs, you should designate a beneficiary who will receive those benefits after you die. A wealth management specialist or financial planner can help guide you through the best way to set up these accounts to maximize the benefits for any individuals or organizations to which you wish to leave a legacy.
Let Loved Ones Know About Your Estate Planning
Once you’ve finalized your estate plans and have certified copies of all relevant documents, make sure all involved parties have copies. Keep a copy of each document in a safe, secure place where you will have easy access. Give a copy of your will, POAs, and Advance Directives or Living Wills to the people designated in them. This way, if you are ever incapacitated or pass away, there will be no uncertainties about your wishes or your estate.