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 August 8

by Karen Purze

Being organized is one thing, being prepared is another. Life in Motion Guide makes it easier for you to get all your important personal information organized. But you need to be prepared, too. For example, if you don’t have your basic estate planning documents in place, your family or delegates won’t have the legal authority they need to advocate for you. When you need them the most, they could be stuck with bureaucratic hurdles to clear before they can make decisions on your behalf.

Estate Planning Basics: What is an Estate Plan?

An estate plan is a roadmap (in reality a set of documents) that outlines what you want to happen to you, your dependents, and your assets (and liabilities) if you are not able to speak for yourself.

Estate Planning Basics: Key Documents

The essential estate planning documents are:

  1. A medical or healthcare power of attorney to designate someone to make healthcare decisions for you any time you are not able.
  2. A living will to specify how you want health care decisions to be made at the end of your life. In some states, the combination of the living will and the healthcare power of attorney are called an “advance health care directive.”
  3. A durable financial power of attorney to allow someone to act on your behalf to manage property, financial assets, or other matters. You decide what conditions “trigger” the agreement, and the extent of the powers granted.
  4. A will or trust to ensure that property passes according to your wishes in the event of your death.
  5. Guardianship designations (if not covered in will or trust documents) to define who will care for your dependents if you cannot.

Estate Planning Basics: Taking Action

Now you know what you need, but how? If you can afford one, it’s a good idea to consult a lawyer. Many attorneys offer affordable estate planning packages and will work with you to get all of these documents in place. You can do it yourself, too, with a bit of work and care. There are good online resources like Nolo.com to educate yourself and find free or inexpensive templates. There may also be free legal services in your area through non-profit or community organizations if the cost is a concern.

Keep in mind that the documentation is not usually the hard part here — the hard part is getting started, making the actual decisions, and understanding the implications of the choices you make.

An experienced attorney can:

  • Answer questions quickly that could take you hours to research online.
  • Explain the pros and cons of different options.
  • Help you decide what’s best for your situation after getting to know you.

Estate Planning Basics: Important Next Steps

Once you have the key documents in place, there are a few other planning “must haves” that ensure your wishes can be easily followed:

  1. Ensure someone has (and securely stores) information on how to access your house, phone, computer, and primary email account.
  2. Ensure beneficiary designations are in place for investment, insurance, and retirement accounts. These beneficiaries should match what you state in your will or trust. For example, don’t name your sister a beneficiary on an account if your will says you want your children to inherit all your assets. Contact the institution where the account is held to find out procedures for adding or updating beneficiaries.
  3. Update property, vehicle, or other asset titles to reflect your wishes (and match your will or trust documents.) State and local laws determine your choices and define the processes for changing property titles. Investigate online, or work with an attorney.

These last two steps are important because beneficiary designations and property titles define how property and financial assets are inherited (not the will or trust.) These types of assets pass “outside” the estate so it’s important that they are set up “correctly” (i.e., according to your wishes.)

Now it’s time to get moving! If you don’t take care of this yourself, a court or a doctor may be called on to make these decisions for you.

You don’t want that, do you?


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About the author

Karen Purze is the author of Life In Motion: A Guide for Gathering Life’s Vital Details, a workbook to help people get their affairs in order. She is currently working on a memoir about her caregiving experience. Sign up for the Life in Motion Guide newsletter to be the first to hear more!

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