Preparing an estate plan is an important step to take. When beginning the process of developing your estate plan, it is important to include the different estate planning documents that you need and to know what the different estate planning documents do.
Different estate planning documents can help the estate planner ensure their estate plan accomplishes their wishes and have peace of mind that their loved ones will be cared for.
Important tools to help estate planners:
- Will – A will distributes that estate planner’s property according to their direction. It also appoints an executor to manage the distribution and settling of the estate and can appoint a guardian for minor children of the estate planner. A will must comply with state laws in order to be valid so it is essential for estate planners to be familiar with the laws in their state to assure their will is valid and will accomplish their wishes.
- Trust – A trust can help transfer property to loved ones without the need for the probate process. The probate process can be time consuming and costly so many estate planners may wish to avoid it for their loved ones. There are different types of trusts, including revocable and irrevocable, or living, trusts. It is beneficial for estate planners to know which type of trust can best help them achieve their overall goals for their estate plan.
- Advance Healthcare Directive or Living Will – An advance healthcare directive or living will provides instruction for the estate planner’s medical care and treatment if they become incapacitated and are unable to direct the care for themselves. Additionally, it appoints a trusted individual to make those healthcare decisions for the estate planner if they are incapacitated at some point.
- Power of Attorney – A power of attorney, like an advance healthcare directive, can help if the estate planner becomes incapacitated at any point; a power of attorney appoints a trusted individual to direct the estate planner’s financial affairs if the estate planner becomes unable to do so for themselves.
There are some other types of documents estate planners may wish to include in their estate plan but the overall importance of knowing what documents to include in an estate plan cannot be underestimated. Estate planning is a personal and individualized process which is why different estate planning tools are available to help estate planners develop and estate plan that addresses their unique needs and concerns.