No matter your income level, Estate Planning is important for couples that are not married and for people with minor children; especially children with special needs. You may want to make particular instructions if you have heirs that are likely to fight among themselves. Also, Estate Planning with an attorney is helpful if you can’t decide how to divide your assets or want to make special provisions.
Who needs Estate Planning?
Nearly 50% of the population dies without a Will. I know it can be a scary process, but my clients are always relieved once a plan is in place. They have a peace of mind that the well-being of their loved ones is secured.
Currently, only about 2% of the population has a federal estate tax issue. If you are in that category, you could save a lot by planning properly, and early enough.
Estate Plans consist of a several legal documents:
Will – A Will takes effect upon your death. A Will is the basic planning document that gives instructions on who should take care of your kids and who gets your assets.
Power of Attorney (POA) – A POA is used while you are alive, but during a time of incapacity. A proper POA authorizes a person of your choice to run your business or personal financial affairs.
Medical Surrogate – Medical Surrogates, or Medical Powers of Attorney, are very important if you have special health care needs and desires.
Living Will – A Living Will can alleviate the agonizing emotional trama your loved ones could experience when deciding to keep you on life support or let you go. You make the choice now; not them later.
HIPAA Authorization – A proper HPPAA Authorization gives your medical providers the legal ability to speak with your loved ones.
Trust – Basically, a Trust allows you to control your assets during life, during an incapacitation and after life.
Finally, simple planning is just as important as drafting legal documents. If you have an insurance policy make sure your beneficiary designation is correct. Check with your bank and investment advisor to make sure you have indicated the proper person for a Transfer on Death, or Pay on Death.
As you can see, Estate Planning is for most everyone, not just the super wealthy.