Colorado residents who do not have any children or close relatives may feel that having an estate plan is not necessary. However, it is important for adults to have one, not only to specify what should happen to their assets when they die, but to also prepare for the unexpected while they are still alive.
Two important legal documents to have in an estate plan are a durable power of attorney for financial and legal decisions and an advance health care directive. Individuals can use these documents to ensure that someone they trust will be making those decisions on their behalf should they become incapacitated. Without these documents on file, there are decisions that even a spouse will not have the authority to make. Additionally, in situations in which individuals are incapacitated without having completed the documents, it will be up to the courts to designate someone to make those determinations.
As part of their estate plan, individuals should also strongly consider creating a trust. A trust can be used to manage certain assets during a person’s lifetime and can be used for the purposes of the distribution of those assets when that person dies. Two of the main reasons using a trust is strongly advised is that it is useful for eliminating the need for probate and it gives individuals a safe and discrete way to distribute assets to their heirs.
An attorney may assist clients with determining what type of legal documents should be included in their estate plan. This can help to ensure that their affairs are managed according to their wishes if they become incapacitated and when they die.