In fact, this is something that should be done as early in your adult life as possible since there’s no way to know when a disease or injury will unexpectedly take your life or affect your ability to function. Having a plan in place will ensure that you, your loved ones, and your assets will remain protected.
Create a Will
The first thing you will have to do is create a legally binding will. While this is something you can do yourself with a form that can be downloaded from the internet, you may still need to consult an attorney if you need to customise your will. One reason a will is vital is in determining the guardianship of your children.
If you die intestate, or without a will, the court will hold a hearing to determine the guardianship of minor children. In that case, someone you may not have trusted to love and care for your children could be granted guardianship and may end up in control of their inheritances. Your will is also essential for establishing your final wishes in regards to your funeral and burial.
Add a Living Trust
When you go to an estate planning attorney for legal advice and information on trusts, they will explain that a living trust is a private document. For this reason, assets can be transferred to new owners without having to go through the probate process. This is especially beneficial when you have a specific asset that you want to pass onto a loved one after your passing.
If you die intestate, or without a will, the court will hold a hearing to determine the guardianship of minor children.
For example, if you own a vacation property that you want to leave to your daughter, you can transfer that property to her via the trust. If it were to be included in the will, it might be sold to cover your final debts, or another heir might take possession of it. When included in the trust, ownership is immediately transferred to your daughter as you intended.
Include Powers of Attorney in Your Estate Plan
You will also need documents that will protect you in the event you become physically unable or mentally incapable of acting on your own behalf. Either through the sudden onset of an illness or serious physical injuries, you may not be able to communicate your medical care decisions.
A health care proxy allows you to choose someone you trust to make those decisions for you. The individual you choose can be left instructions for your care, or you can trust their decisions in determining your care as necessary.
Additionally, a durable power of attorney lets you choose someone to act on your behalf in making legal and financial decisions. This individual can be the same person you choose as your healthcare proxy or someone entirely different. Once you can’t make decisions for yourself, they will act for you in collecting income, paying bills, handling investments, and attending to other financial matters.
You will choose the conditions in which the durable power of attorney and healthcare proxy are enacted and revoked. These estate planning tools are solely intended to benefit you for as long as you’re unable to make your own decisions.
Review Your Estate Plan Periodically
You should meet with your attorney once a year to go over your estate plan and update its terms. This includes adding assets that you recently acquired as well as changing your executor, beneficiaries, and heirs as necessary.
If you don’t make annual reviews, you could end up leaving an ex-spouse as your primary beneficiary, or you could forget to name a new child as a beneficiary. Keeping up to date on your estate plan will ensure your estate will be handled in accordance with your wishes upon your death.
When you consult an experienced estate planning attorney, they will determine how these documents and other legal tools can be customised for your situation. Together with your lawyer, you can create a plan that addresses the issues that are most important to you. At any age, estate planning is the best way to protect your future.