When drafting an estate plan, it is important to include all of your financial assets and documents. These should include bank and credit card accounts, mortgages, annuities, retirement benefits, and investment portfolios. You should include instructions for identifying beneficiaries and accessing your financial accounts. You may even want to include a living will and healthcare power of attorney to make your wishes clear in the event of an illness.
It is recommended to regularly review your estate plan, especially if you have undergone major life changes such as marriage, childbirth, or a significant change in your financial situation. It is important to have a plan in place before an unexpected life event, like death. Estate planning can help minimize tax burdens and make the administration of your estate more efficient.
A last will and testament are the foundation of an estate plan and one of the most important tools in settling your estate. Without this document, the state will decide how to distribute your possessions and assets. If you are unable to make decisions for yourself, a court may appoint a guardian. This guardian will make financial and medical decisions on your behalf. Lastly, a preneed guardian designation will name someone to act on your behalf if your durable power of attorney or health care surrogate designations fail.
A will is perhaps the most well-known document in an estate plan, but there are others that can be as crucial. A general durable power of attorney, HIPAA release form, and a living will are just a few of the most common estate planning documents. Creating a will is essential to ensure your assets are left to those you want. Without it, the state will determine the rightful heirs, which means your family will be unable to make decisions regarding your assets.
A last will and testament is a legal document that lists your assets and names beneficiaries. It also names a person to administer your estate after your death. The executor will have to make sure all items are distributed according to your wishes, and this person will need to make sure these items are transferred to your beneficiaries.
A revocable living trust is another important document in an estate plan. It names a trustee who will manage your assets upon your death. The trustee will manage these assets according to your instructions. The trust can be revocable or irrevocable, depending on the circumstances of the person.
Another important document in an estate plan is a financial power of attorney. This document allows a person to make important financial and healthcare decisions for you.