A cohesive estate plan includes several documents that work together so that your assets, health needs, financial responsibilities and family are covered if you are incapacitated but still living, or if you have died. An estate plan normally includes some or all of the documents listed below. We hope that this information is helpful as you prepare for our meeting.
What an estate plan includes
Last Will or Revocable Trust
These documents dictate where and how your assets are distributed. They guide the person you appoint to manage the distribution of your assets (i.e., your fiduciary) through the process according to your wishes. Most people only have one or the other. Many people ask whether a Revocable Living Trust provides any asset protection, and it does not.
Durable Financial Power of Attorney
This document designates an agent to help manage your finances while you’re still living but unable to manage them on your own. The document also includes a listing of what powers your agent is granted when acting for you.
Health Care Power of Attorney
This document (sometimes called a “Health Care Proxy”), designates an agent to make healthcare decisions on your behalf (and for your children) if you’re unable to communicate, and dictates the types of powers your agent has when making those decisions. This document can also allow your agent to communicate your wishes regarding life support and may include your wishes regarding organ donation and the disposition of your body.
Health Care Directive
This document (sometimes called a “Living Will” or an “Advance Directive”), describes your wishes regarding withdrawing or withholding life support in specific circumstances. Your wishes in this document are generally carried out by your agent named in the Health Care Power of Attorney.
Separate Authorizations for Information
These documents designate who has access to and can share your healthcare information, as well as some of your online information such as usernames, passwords, and the content of digital accounts (for example, photos, emails).
Coordinated Beneficiary Designations
These documents provide the language needed to help coordinate your retirement asset and life insurance designations with the distributions described in your new Will or Revocable Living Trust.
How are these documents coordinated?
A cohesive estate plan includes several documents that work together.
During Your Life
Your Agents under your Powers of Attorney and Health Care Directive work as a team to make sure that your health care needs and financial assets are managed properly should you become incapacitated. (If you have minor children, these documents also provide for care and health needs of those children).
At Your Death
Your Health Care Power of Attorney and Health Care Directive will make sure that your organ donation and end-of-life preferences are honored.
After Your Death
Your Will or your Revocable Living Trust and your updated Beneficiary Designations will operate to pass your assets to your chosen beneficiaries in the way you’ve decided.
Why do you need an estate plan?
Control
With a personalized, cohesive estate plan, you are making sure that you, your loved ones, and your assets are taken care of in the way that you decide.
Avoid State Law Defaults at Death
If you don’t have an effective Will or Revocable Trust at your death, state laws step in to dictate how your assets are distributed, who is appointed to carry out that distribution, and who is assigned as a guardian for any dependents you may have.
Avoid Court-Supervised Guardianships
If you don’t have effective and up-to-date Powers of Attorney when you need them, your family will be required to open a court-supervised guardianship and conservatorship to manage your health care and assets. These court processes can be slow, difficult, and expensive. They can also be quite rigid, removing a lot of the flexibility that you might want for your care and asset management.
This guide provides general information about estate planning and is not legal advice for your situation. Laws vary by state and change over time. Please talk with an attorney before acting on anything you read here.