Did you know six in ten American adults have no will or estate plan in place? (Caring.com) No one wants to be reminded of their own mortality or spend too much time thinking about what might happen once they’re gone. But here is some food for thought:
An estate plan allows you to rest easy knowing your future generations are protected.
Wondering where to start? We’ve gathered the five most important documents to begin your estate plan. While these documents may not be everything you need to get started, they will start your journey to peace of mind.
1. Will
A will is a legal document that outlines your wishes for how your property, possessions, and other assets should be distributed after your death. It also allows you to name guardians for minor children and specify other personal instructions, ensuring your intentions are clear and legally recognized.
2. Power of Attorney
A financial power of attorney designates a trusted individual to manage your finances and make legal or business decisions if you become unable to do so yourself. This can help avoid delays and complications in paying bills, managing investments, or handling other important matters during your incapacity.
3. Healthcare Directive
Also called a healthcare power of attorney, this document names someone you trust to make medical decisions on your behalf if you are incapacitated. It ensures your healthcare choices are carried out according to your wishes and can provide guidance to your appointed decision-maker during stressful situations.
4. Living Will
A living will states your preferences for life-sustaining medical treatments, such as resuscitation, ventilator use, or feeding tubes. It can also authorize someone to make these decisions for you. This document helps loved ones and healthcare providers honor your values and avoid uncertainty during critical moments.
5. Revocable Trust
A revocable living trust allows you to transfer ownership of your property into the trust during your lifetime, while still retaining control over it. Similarly to a will, upon your death, the assets in the trust can pass directly to your beneficiaries without going through probate—a potentially lengthy and costly court process.
6. Irrevocable Trust (if applicable)
Unlike a revocable trust, an irrevocable trust cannot be changed or revoked once it is established. When you transfer assets into an irrevocable trust, they are generally removed from your taxable estate, which can provide potential estate tax benefits and asset protection from creditors. This type of trust is often used for more advanced estate planning goals, such as protecting wealth for future generations or charitable giving.
At Financial Designs Wealth, we focus on providing simple solutions in a complex world. We walk our clients through every step of the process to ensure their estate plan is executed, providing a seamless transition to the next generation.
Ready to start planning?
Jennifer Valdes, Certified Financial Planner® is ready to secure your financial future.
Send An Email or Call: 786-388-0030