In a living trust, you can specify your wishes for care at the end of life. A power of attorney can give someone else the authority to manage your assets and finances.
You can also designate beneficiaries to assets such as life insurance policies or retirement accounts. This will ensure they are passed directly to those you select without going through probate. The five documents listed above are the foundation of an estate plan.
A last will is a document that gives instructions on how and where you want your assets (also known as your estate) distributed. In a previous will, you can also designate an executor responsible for carrying out your final wishes. You can choose more than one executor.
The will also include a section that establishes how your debts should be settled and how your remaining assets should be distributed. The will can consist of guardian designations for minor children, conservatorship for any pets and other important details.
Many people avoid creating a will or trust because they believe it’s something only the wealthy have, but the truth is that everyone can benefit from an estate plan. Your estate planning lawyer in Walnut Creek helps ensure your loved ones don’t have to go through the often long and expensive probate court process to determine your intentions and what happens to your assets after you pass. And it’s much better than leaving it up to state law to decide for you.
Having a well-drafted trust can provide a way to control how assets are distributed after your death. This can be particularly important if you have heirs who may need to be more responsible or capable of managing finances. A trust can also help to reduce estate taxes and avoid unnecessary litigation.
Typically, assets in a trust pass directly to beneficiaries without the need for probate proceedings. This saves time, money and complication for family members. However, this requires careful planning and a knowledgeable attorney to establish.
A properly drafted trust protects from lawsuits, bankruptcy, and spendthrift heirs. Additionally, a properly prepared trust can make it easier to qualify for Medicaid after your death. Lastly, trust can make expressing your wishes regarding end-of-life decisions easier. This can include what type of treatment you want (or do not want) if you cannot speak for yourself. This is done through a Living Will and Health Care Proxy.
Power of Attorney
A power of attorney is a legal tool that grants another person legal authority to make decisions on your behalf. The person to whom you give this authority is known as your agent. You may also choose to revoke (cancel) or limit the powers you grant them. A power of attorney is commonly included in online estate planning service packages because it helps ensure your wishes are carried out and that your family does not have to deal with the hassle of a court proceeding called a conservatorship or guardianship.
Two types of POAs are available: a health care power of attorneys and a financial power. An economic power of attorney allows someone else to manage your finances. A healthcare power of attorney will enable you to decide about end-of-life care and other medical issues before you cannot speak for yourself. It would be best if you chose someone you can trust. Others choose to work with their spouses or children, while others select an attorney. The agent you choose should know your financial situation well and be trustworthy.
Medical Power of Attorney
If you become incapacitated, you can appoint a medical power lawyer or healthcare proxy to make your medical decisions. This is the most important thing you can do for your loved ones.
The document typically includes a medical power of attorney and a living will. A living will expresses your wishes about whether you want to have life-extending treatment and other end-of-life decisions.
You can designate the same person as your financial and medical powers of attorney or choose different people for each role. It’s usually best to have the forms notarized so you can be sure that the people you choose truly understand your wishes.
With this vital estate planning document, your family may avoid expensive and time-consuming court proceedings to petition for guardianship to make medical decisions if you cannot speak for yourself. A simple POA document prevents this and helps your loved ones avoid court costs and hassle.
Beneficiary designations are essential for estate planning, enabling you to dictate who will receive your assets. They typically bypass the probate process, making accessing your purchases easier for loved ones.
In addition to spouses and children, you can designate beneficiaries as friends or charities. Regularly reviewing and updating beneficiary designations is important, particularly following significant life events such as marriage, divorce, childbirth or death.
One of the most common mistakes is failing to coordinate beneficiary designations with a trust or will. Incorrect or outdated beneficiary designations can disrupt your estate plan and cause unnecessary financial hardship for loved ones.
Should you become incapacitated, you can also use a living will and health care proxy to provide instructions regarding your medical care. This can ensure that your treatment team respects your wishes. A legal guardian can also be appointed to advocate on your behalf. Contact us for help preparing these documents or to discuss your specific circumstances. We can help you create an estate plan that reflects your unique goals and needs.