Many people shy away from setting up an estate plan because they don’t exactly understand what it is, why it is important, and when to start the process. An estate plan is a set of legal documents that specifies what will happen to your property, assets, and dependents after you pass away. It can include a number of different documents, such as a will, trust, power of attorney, and advance healthcare directive. By creating an estate plan, you can protect your family by ensuring that your wishes are carried out and that your loved ones are provided for financially. An estate plan can also help to avoid conflicts and legal disputes among your family members after your death and can make the process of settling your affairs much smoother and less stressful for your loved ones.
There are several common documents that are often included in an estate plan.
- Last Will and Testament (also known as a “will”): A will is a legal document that specifies how you want your assets to be distributed after your death. It can also name a guardian for your minor children. In your will, you can specify who you want to receive your assets, such as your spouse, children, or other loved ones. You can also appoint an executor, who is responsible for carrying out the terms of your will and overseeing the distribution of your assets.
- A Revocable Living Trust: A trust is a legal arrangement in which you transfer ownership of your assets to a trustee, who is responsible for managing the assets for the benefit of your named beneficiaries.
- Durable Power of Attorney: A durable power of attorney is a legal document that allows you to appoint someone to make financial on your behalf if you become incapacitated.
- Medical Power of Attorney (also known as a healthcare proxy or healthcare power of attorney): A medical power of attorney is a legal document that allows you to appoint someone to make healthcare decisions on your behalf if you become incapacitated and are unable to make decisions for yourself.
- Living Will (also known as an advance healthcare directive): A living will is a document that outlines your wishes for medical treatment in the event that you are unable to make decisions for yourself due to illness or injury.
- Title and Property Deeds: Title and property deeds are legal documents that transfer ownership of real estate from one person to another.
- Beneficiary Designations: Many assets, such as life insurance policies and retirement accounts, allow you to name a beneficiary who will receive the assets after your death. It is important to review and update these beneficiary designations to ensure that they align with your overall estate plan.
These are examples of the types of documents that may be included in an estate plan. The specific documents that you need will depend on your individual circumstances and goals so it is important to work with an attorney, paralegal or Certified Legal Document Preparer, or financial planner to determine the appropriate documents for your estate plan. If you choose to prepare your own estate plan documents, be sure to do your research using credible and trustworthy resources.
A few more ways that an estate plan can protect your family:
- It can help to ensure that your minor children are cared for by the person you choose, in the event that you are no longer able to do so.
- It can allow you to specify how your assets will be distributed after your death, so that your loved ones are financially taken care of.
- It can help to avoid probate, which is the legal process of settling an estate. Probate can be time-consuming and costly, and an estate plan can help to streamline the process and minimize expenses.
- It can protect your loved ones from creditors and lawsuits. By setting up a trust, you can shield your assets from creditors and protect your loved ones from legal challenges.
- It can help to ensure that your healthcare wishes are carried out in the event that you become incapacitated and are unable to make decisions for yourself.
There is no specific age at which everyone should put an estate plan in place, as everyone’s circumstances are different. However, it is generally a good idea to start thinking about an estate plan once you have assets or dependents that you want to protect. This might be once you have a spouse, children, or significant assets such as a home or business.
It is also a good idea to review and update your estate plan on a regular basis, as your circumstances may change over time. For example, you may acquire new assets, have children, or experience a change in your personal relationships that could impact your estate plan.
Whether you use a legal professional to help you prepare your estate plan, or you do it yourself, it is important to use an experienced Notary Public to notarize your signatures, as well as those of impartial witnesses for your Last Will and Testament depending on state requirements. This is why Success Signings, LLC provides estate plan signings in Tempe, AZ.