Many individuals know the importance of estate planning as part of their long-term financial planning task list. But the majority of these people procrastinate because they don’t have an idea of the essential documents required for the task. In fact, estate planning isn’t difficult when you know what estate planning documents you should have. This article provides information on what estate planning documents you should have.
The Last Will & Testament is one of the most important documents that you need to have when planning to distribute your assets after your death. Although the name may sound intimidating, this document is nothing more than a written legal document that highlights how you would like your property and assets distributed after your death. You can name an executor to carry out the instructions on the Last Will. You can also name guardians for your minor children in this document.
The Living Will is another important document in the estate planning process. This document is also known as a Healthcare Proxy – which includes your wishes regarding medical care facilities if you need to be on a life support system or become terminally ill. One may also consider a Healthcare Power of Attorney when preparing a Living Will. The Healthcare Power of Attorney will permit the individual to designate a healthcare agent to carry out the tasks in the Living Will.
A Living Trust is another important document in the estate planning process. Many people involved in the estate planning process would step up a Living Trust. This document will help your estate to avoid a probate court. This is very important since a probate court can take up to three years and cost more than 10% of the value of your estate. It also helps ensure your privacy since probate documents are open to the public. That is why you need to seriously consider a Living Trust when planning your estate.
The Financial Power of Attorney is considered another important document when it comes to estate planning. This document helps to designate a person to manage the affairs of your estate – including any financial decision. You can also choose when the appointment goes into effect – whether it is with immediate effect, or a future date, or only under certain circumstances.
The aforementioned article provides information on what estate planning documents should you have.