What's an Estate Plan
An estate plan consists of a strategy to protect your family and your assets I the event of incapacity or death. Protecting your family is designating who will care for minor children and how to provide financially for those you leave behind.
In the event of incapacity, your estate plan consists of a durable power of attorney to manage financial decisions and an advanced health care directive to manage medical decisions.
In the event of death, your estate plan consists of instructions of what to do with your how your wealth, assets, pensions, and more will be gifted to your heirs after you pass away.
Your estate plan can and should deal with these issues in advance so that your loved ones don't have to.
Okay, so what makes up an estate plan?
An estate plan is made up of a handful of very important documents, each with a different and unique purpose.
Critical estate planning documents:
A Trust allows you to set aside money and other assets for people or organizations. These accounts do not go through probate, which can be an expensive, long, drawn out process. That means your heirs will be able to inherit what you want them too, faster, and without nearly as much hassle.
A Last Will and Testament lets you choose who inherits your assets, select guardians for your children, and name an executor to make sure your wishes are carried out. It's the most important part of an estate plan.
A Financial or Durable Power of Attorney also lets you choose a trusted agent to act on your behalf to handle your finances. You give them specific access to accounts to help make sure your bills and mortgage stay current.
A Living Will is the document you complete which determines end of life decisions, who has the authority to pull the plug on life support, etc.
A Healthcare Power of Attorney concerns medical treatment issues, you name another person to make those decisions for you. Generally, this is a spouse, family member, or close friend.