The dreaded estate plan. This typically pops up on peoples radars when they have their first child but executing it is another story. Something about the thought of death freezes any actions. Maybe it’s too far down the road for people to act on it but I believe that everyone should have some type of game plan. As the old adage goes, plan for the unexpected.
What’s in an estate plan? Although you can write up documents yourself, I would not recommend do so. These documents should be prepared by a qualified attorney in the state that you reside.
- Wills – a document that names an individual to manage your estate and distribution of your property
- Here you can state who can inherit your property, who will be guardian of your children (assuming they’re under legal age), decide how pets are taken care of and decide how debts are paid
- Essentially, this document will allow you to speak from your grave
- Power of Attorney – a document that will name an individual to speak on your behalf when you cannot speak for yourself
- There are 2 items here.
- 1st – Health Care Directives – with this document you can select who will speak on your behalf for medical related issues.
- 2nd – Financial Power of Attorney – you can select who will make financial decisions on your behalf
- These documents will allow a loved one to speak on your behalf if you were to become incapacitated
- There are 2 items here.
No Estate Documents
These are the basics to have in an estate plan but what if you chose to forgo the plan and let the chips lie as they may. First, let me discuss what will happen if you had a will prepared. Upon death, your executor, will file a request with the court. This is the initial step which will begin the process of probate. Probate is a Latin term meaning to prove. The court will go through this process to check the validity of the will. The court wants to make sure that what was written was the true wishes of the deceased person. Probate can take time and in some cases years but in the end if the will was properly executed the deceased’s wishes will be carried out.
If you die without a will the court will go through probate but a process called intestate succession. This is where the court will decide who will receive your property. So essentially you are allowing another the courts to decide your wishes. This will also take time and money to resolve.
Things can happen in life and it may end sooner than you think. I honestly believe that everyone should have a game plan because you may never know what will happen. Having the right documents will allow your wishes to become reality and it will make the person’s job you left behind a little easier. This is especially true if you have children because I’m sure it is very important to you to choose the right person to take care of them.