Do It for Your Loved Ones: 4 Reasons You Need Estate Documents

Estate Planning | Financial Planning | Succession Planning | Blog Home | Sudden Wealth | High/Ultra High Net Worth

 Plancorp team By: Plancorp team

Does anyone really enjoy thinking about, let alone discussing, their mortality? Most of us do whatever we can to avoid this topic. While that’s human nature, doing a little planning now can save major headaches for our loved ones down the road.

Whether you have millions of dollars or very few assets, here's how estate documents help you and your family prepare for the unknown.

1. Express your wishes on health care decisions.

Key document: Living Will and Health Care Power of Attorney.

If you’re adamantly opposed to, or in favor of, mechanical respiration, CPR, artificial nutrition and hydration, etc., this document allows you to state your preferences for treatment in the event you’re in a situation requiring these decisions. A Living Will is usually accompanied by a Health Care Power of Attorney. This gives you the ability to name a person, or multiple people, to whom your physician(s) can provide information about your care. (This person typically has the ability to make choices on your behalf if those choices aren’t already stated in your Living Will, so you should have confidence in him or her!)

2. Give authority to manage your financial affairs.

Key document: Durable Power of Attorney

A Durable Power of Attorney gives an individual, or individuals, the authority to manage your financial affairs in the event of your incapacity. This person is called an attorney-in-fact.  Within the document, you can state various actions that the attorney-in-fact can or cannot perform. As with a Living Will, this document is applicable during life and ceases at death.

3. Decide who gets your assets when you’re gone.

Key document: Last Will and Testament

So, what happens to your belongings when you’re no longer here?Unless you want the state to decide for you, you should execute a Last Will and Testament. This document states who will receive your assets and in what proportions. It also names your Personal Representative, a.k.a. Executor, who is responsible for, among other things, overseeing the distribution of your assets, paying final bills, and filing final tax returns. Perhaps most importantly, this document also allows you to name a guardian for your minor children.

4. Take out the guesswork.

Key documents: Revocable Living Trust and Letter of Instruction

We’re almost done!  Depending on your situation, it may also be advisable to have a Revocable Living Trust. Notice the word “Revocable.” Like all of the documents mentioned above, you can entirely revoke or amend a Revocable Living Trust during your life. If you don’t have a trust and want to know if it’s appropriate for your situation, contact your  Wealth Manager. Lastly, you will want to include a letter of instruction with your Last Will and Testament.  This letter can convey your burial wishes, location of other important documents, etc.

If you already have these documents in place, it’s likely that you haven’t reviewed them recently. After all, who wants to visit the dentist to check-up on a root canal? While getting an estate plan together is a big step, it’s crucial to review it regularly, and your Wealth Manager can help you do that.

download the estate planning memo worksheet

 

 

 

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