Estate Planning Is So Much More Than Just Writing A Will: Power of Attorney, Trusts & more…
When you think of estate planning, you probably think of writing a will. “I, being of sound mind and judgement, do hereby declare” and all the rest, right? An while writing a will is important, there are other parts to planning for your estate that you should remember.
The most essential thing for creating a good estate plan is calculating your net worth. You can determine your net worth by simply adding up the value of all your assets (property investments, money in your bank accounts, jewelry, collectibles, etc.) and subtracting from this all of your liabilities (loans, mortgages, credit card debt, etc.). Once done, it’s time to take a look at the list of things you need to include in your estate planning –
1) Guardianship Agreements
Writing a will is usually the last thing on young parents’ minds. However, providing the care they want or need for young children is crucial. You and your partner should discuss who your children should go to in the event that both of you pass away before your children are adults. This is a particularly important conversation to have with the guardians you choose. Be sure to set up a Guardianship Agreement to ensure family courts have the best information about your child’s care.
The guardianship agreement should also be reviewed and updated every few years to account for life changes—someone who no longer lives in the country or is in poor health may not be a great guardian.
2) Living Will or Power of Attorney
Living wills and Powers of attorney are two documents that work closely in concert to ensure that your medical care at the end of your life falls in line with your wishes. Your living will, or advance directive should lay out your priorities in treatment.
(This article about final wishes conversations may give you things to consider as you draft your living will.)
Once you have a living will, you can also set up a power of attorney. This gives a loved one the power to make medical decisions for you if you are incapacitated. Be sure to go over your living will with your loved one. This can be a hard conversation but will make life a lot easier for your loved one.
The power of attorney should also be reviewed and updated every few years to account for life changes—someone who has moved far away from you or is in poor health may not be a great person to have power of attorney.
As you’re writing a will, you should consider other options, including trusts. It can be helpful to discuss with a lawyer whether the trust or a will works best for you. The primary difference between the two is that trust goes into action immediately, and does not go through probate. These living trusts can be helpful if you would like to avoid public probate, your assets exceed the $5 million set out by federal law, or you have a complex estate spread across several states or countries.
4) Online Presence
For many people now, their online presence is a valuable part of their identities. Between your blog and your Twitter account, a good deal of information about you is on the internet.
It can be helpful to think about what you would like to happen to your accounts after your death. You should then leave a list of instructions and passwords along with the rest of your estate planning documents.
Once you have documents that account for your assets, your children, and your healthcare, you need to make sure they are accessible to your loved ones! Keep a clearly marked file in your desk, and be sure to upload everything to Jazmine as well!