Putting together an estate plan is a great way of taking care of and protecting your loved ones and yourself as well. I often think that many of my clients equate going to a lawyer with going to the dentist to have a root canal done. Either they’re scared or simply disinterested. I get it; estate planning sounds depressing and kind of boring. But it doesn’t have to be that way. If done right by the professional, the process will not be morbid, boring, gloomy, or painful. Not at all. I can assure you that. Trust me.
Here are some things to think about before you set up an appointment regarding your estate. Although this list may look intimidating, you really have to hit all of the bases if you are going forward with an estate plan. The goal is to try to plan for as many contingencies as possible.
You DO NOT NEED TO KNOW OR HAVE THE ANSWERS to all of these questions before you start walking down this road. Just thinking about them is good enough. When we meet, we will nail down the options and choices. For now, let’s just talk about the basics.
FINANCIAL THINGS TO THINK ABOUT
There are 3 financial documents that make up an estate plan; namely, Revocable Living Trust, Last Will, and Financial Durable Power of Attorney. Basically, the Revocable Living Trust and Last Will name someone to handle your finances once you are deceased. A Financial Durable Power of Attorney, on the other hand, names someone to handle your finances if you are mentally out of it. I recommend that the person you name to handle finances be the same person for all of your finance- related documents, if possible. Ask yourself the following questions before deciding on and creating a plan.
- Who would you name to make financial decisions for you?
- I recommend at least a plan A and a plan B. Let’s say you name John. What if John is ill? Has died? Is in the far reaches of the Sahara Desert and just can’t handle things for you?
- If you own your house, do you want it sold when you pass away or given to someone?
MEDICAL THINGS TO THINK ABOUT
There are 3 medical documents that make up an estate plan. These are Durable Health Care Power of Attorney, Durable Mental Health Care Power of Attorney, and Living Will. The Durable Health Care Power of Attorney names someone to make medical decisions if you are mentally out of it. A Durable Mental Health Care Power of Attorney names someone to lock you in that nice padded cell. A Living Will says to pull the plug. Below are other concerns you need to take into consideration:
- Who would you name to make medical decisions for you?
- The same questions I asked above with John apply here. You want to try to have a plan A and a plan B.
- Do you want to be an organ donor? Many people have said “yes” on their driver’s licenses. The driver’s license “yes” generally means for transplant. Estate planning can expand that “yes” to include medical and/or dental education and medical and/or dental research.
- If the plug is going to be pulled, would you want a member of the clergy to come to your bedside first?
THINGS TO THINK ABOUT WITH KIDS
- How old should kids be before they get their inheritance outright, with no strings attached?
- Who should raise your kids if you are deceased? The people named to raise your children are called guardians. You definitely want a plan A and a plan B for guardians.
- Let’s say you name John and Jennifer. Do you have a preference for guardian if John and Jennifer split before serving as guardians—i.e. John only or Jennifer only?
THINGS TO THINK ABOUT WITH PETS
- Who should get those cute and cuddly pets? No surprise, I recommend a plan A and a plan B again.
- Do you want to leave money to the pets’ caretaker for the care of the pets? I often see folks leave $5000-$10,000 for the care of pets.
THINGS TO THINK ABOUT IN GENERAL
- Take into consideration the ages of the folks you are looking to name to make decisions for you. If someone is older than you, you may want to name someone younger as a backup.Take into consideration how other family members, for example, will react to your choices of decision makers and/or guardians for the children. You can choose who you want, but wording can be added to documents to help keep family harmony.
- Take into consideration how other family members, for example, will react to your choices of decision makers and/or guardians for the children. You can choose who you want, but wording can be added to documents to help keep family harmony.
- Know that these documents can be changed anytime. In fact, I recommend that you regularly check or update your plan. I find on average that my clients change their documents about every 5-7 years. The law doesn’t change much, but life has a way of throwing curve balls.
Get in contact with me today to make sure your estate planning affairs are in order.