Having an estate plan can be important because it allows you to determine what will happen to your assets. An estate plan can also ensure that you have a plan in place to protect your assets and get the medical care you want. Your estate plan should be reviewed every few years since circumstances can change and revisions might thus be necessary.
Your finances and health care
A medical directive can appoint someone to make decisions on your behalf regarding your health care. You can use a power of attorney to appoint someone to make financial and legal decisions on your behalf. Another option for protecting your assets in this situation is a living trust, also known as a revocable trust.
You can also use a revocable trust as your main estate planning document. You remain in control of the assets you put in a living trust, and it may have a number of other uses as well. For example, it can protect assets for beneficiaries who have special needs. Assets in a trust do not have to pass through probate, unlike a will. However, for some people, a will may be sufficient as the main estate planning document. Others may want what is sometimes called a “pour-over will,” which is used in conjunction with a trust. It automatically moves any remaining assets into the trust on the person’s death.
Your attorney may be able to help you determine what estate planning documents you need based on your personal situation and your goals. For example, if you are young, you may have only a few assets, and you might want to appoint your parents to manage your assets and health care. A simple will may be enough to manage your assets. Later, you may want to change those documents to name your partner for those responsibilities. When you have children, you might need a more complex estate plan to ensure that they are protected.