An estate plan includes your final wishes regarding assets, healthcare decisions, and key legal documents.
Your estate includes bank accounts, cars and any other asset in your name. It does NOT include insurance policies and investments for which you have designated beneficiaries; those monies are dispersed as soon as they receive a copy of your death certificate. Your estate can also include debts, mortgages, and other loans.
As an aside, having beneficiaries for policies and investments sidesteps having to pay estate taxes on these monies. This is a topic to discuss with a financial adviser.
Consider the following aspects of an estate plan. The will, mentioned first, is needed at your death; the rest will be used prior to that date. An attorney can prepare your estate plan; however, the POLST must be signed by your doctor. These documents are increasingly necessary as you age and/or experience health decline. Do not delay!
- Will – this legal document assigns where your assets go after your death and after your debts are paid. Your will also assigns your executor/executrix who will act in your stead to conclude your affairs as outlined in your will (can be and often is an heir). If no will exists, a probate court will follow the intestate succession laws of your state to assign assets to blood relatives after paying any debts (friends and charities get nothing).
- Living Will – also called an Advanced Directive or Healthcare Directive, this document outlines your end-of-life medical care desires. Family, doctors, and Power of Attorney (POA) agents can use it to make medical treatment decisions for you when you are unable to do so. In some states, the Health POA is combined with this document.
- POLST (for a very frail senior or terminally ill person) – or Physician’s Orders for Life-Sustaining Treatment, this one-page form is signed by a doctor and contains immediate health orders. EMTs and hospitals must follow what the POLST specifies.
The Living Will and POLST documents are not the same. Having both means your end-of-life wishes are protected in all situations. Keep handy both the POLST and Living Will to show to doctors, hospital staff, and EMTs.
- Healthcare POA – this Power Of Attorney document assigns one or more persons as your agent for medical treatment decisions if you are unable to decide for yourself or simply to assist and accompany you to appointments and procedures; copies will be required by doctor offices, specialists, and hospitals.
- Financial POA – this Power Of Attorney document assigns one or more persons as your agent to handle banking, paying bills and conducting financial transactions on your behalf.
Notes about POAs:
- The same person can be assigned to be both health and finance agents.
- Multiple people can be named as agents on either document—but beware that problems can occur if the multiple people disagree. Always choose reliable, trusted family or friends. It can be wise to name a primary agent, and also choose a secondary agent for each POA who takes over if the primary agent named is unable or unwilling to serve.
- If you don’t have a POA in place when you become unable to make decisions, the local court may appoint someone to take care of your needs. If there is no pre-existing POA document but family or friends wish to help, they may be required to petition the court for the proper authority – which can create added stress and cost for them.
- Seniors need a durable POA. Do NOT use a general or non-durable POA, which are used prior to becoming incapacitated. A durable POA can be used anytime.
- A financial POA agent cease to serve at the time of the principle’s death, which is when the executor/executrix named in the will takes over the financial affairs of the deceased.
This information is culled from research and experience. It is not intended to be the final authoritative word. If you are not sure all aspects pertinent to your situation are adequately covered, make an appointment to see a trusted lawyer as soon as possible (it may be beneficial to take a trusted family member or friend with you to that meeting to take notes you can review later).
As with all things, take this to the Lord in prayer. He cares about your every concern. (Philippians 4:6)
