Do you not have any sort of estate planning in place, and want to start planning for the unexpected? Here is what you need to know about how estate planning can work for you.
Why Is An Estate Plan Important?
An estate plan tells others what to do when the unexpected happens. Estate planning isn't just for deciding what happens to your assets after you pass away, but also for making decisions about what happens if you are incapacitated or disabled. An estate plan is the best way to make sure that your wishes are carried out in a worst-case scenario.
For example, if you are involved in an accident and incapacitated, you need to delegate who will make medical decisions on your behalf. You may have a business that you run as well, and need to delegate who will take over for you if you are unable to run the company. In addition, estate planning helps avoid some of the hassle and burden that other people have to deal with.
What Happens If You Pass Away Without An Estate Plan?
One of the main reasons people decide to create an estate plan is because they want to make decisions about what happens after they pass away. If you do not have any sort of estate plan in place, your estate will go through the probate process where someone else will make the decisions for you. This means that some people can end up being awarded part of your estate, even if you do not agree with the decision that is made.
What Documents Are Needed?
If you are going to create an estate plan, there are several documents that you should create at the very least to ensure that you are set. This includes a medical directive, power of attorney, will, and living trust.
A medical directive will decide on what kind of health care direction you want when you are near the end of your life and cannot speak for yourself. Power of attorney is the document that gives power to a specific person to make decisions when you're unable to do so. The purpose of having a living trust is to decide on what happens to your assets after you pass away to hopefully avoid probate. A will can help make decisions not covered in a living trust, such as who would have guardianship of your children.
To learn more, contact an estate planning attorney.