According to a survey from AARP, 60 percent of Americans have done no estate planning whatsoever; not even a will. That is not a good thing, since those who die “intestate” (without a will) essentially have no say in how their assets are distributed. That means the state courts, and not you, will decide who gets the car, or the painting left behind by your aunt, or even your business. A total stranger will decide who gets whatever you leave behind when you die.
If you have worked really hard, and you really don’t care who gets what at the end, then continue to do nothing; the stuff will get distributed, somehow. If, however, you would like to determine who gets what, you will have to draw up a will. Think of it as a favor to your family and other loved ones. When you pass away, they will likely be emotionally devastated, and you will likely not want them to deal with the added stress of having to deal with the probate court, and its tendency to deal with the law exactly as written by legislators who never met you and who have no knowledge of your wishes.
The Future of Your Family Requires Your Attention
The goal of any estate plan should be the same; to make the process of probate much easier and less stressful for your heirs. The probate process is often tedious and full of legalese. With a will, and an estate plan, when you die, the will is filed with the probate court. Shortly, appraisals of your property will be made, followed by an attempt to pay all legal debts before distributing all of the remaining assets and property. Without the road map presented by a good estate plan, the probate process can be long and expensive. On the other hand, if you have one, the probate process will go far more smoothly for your heirs.
The best way to continue to control your assets after you die is to work up a estate plan. Estate planning isn’t just for the rich; even people who aren’t millionaires often have a lot of assets, especially in this day and age. There are many planning strategies available to you, so that you can make sure your assets are distributed in a timely way, and based on your wishes, rather than some one-size-fits-all model that the state legislature developed for every situation and which may not have relevance to your loved ones and what you want to happen with your assets. Everyone is different; don’t feel as if you have to fit one particular vision of how probate should look.
The heart of any estate plan consists of four important documents. There can be more to it, of course, depending on your needs, but these should be included in any plan.
- The Last Will and Testament – this document will determine who gets which of your remaining assets after your death. It will also give you a chance to name an executor, who is the person you trust to carry out your last wishes exactly as you instruct them.
- A Durable Power of Attorney will enable someone you trust, such as a family member or friend, to make decisions on your behalf, should you become too incapacitated to make important decisions on your own. Without this document, then it may be impossible to pay bills or make financial decisions, if you are unable to do so.
- A Health Care Power of Attorney will provide you with the ability to appoint someone you trust to make medical decisions for you, should you become unable to do so. Such appointees will be able to consult with your doctors on medical matters without triggering HIPAA protections and it will allow them to follow your wishes on end-of-life issues.
- A Living Will – Also referred to as an “advanced directive,” this document allows you to express your preferences regarding end-of-life care, yourself. This prevents a lot of confusion when it comes to issues regarding extraordinary methods of preserving life and which machines may or may not be used to keep you alive toward the end.
You will need help to put all of these pieces together and you’ll need an estate planning attorney by your side – someone who can give you advice and also draft the documents you need to protect your friends and family at the end.