We believe that death shouldn’t be taboo. In fact, we know that it should be discussed properly in any given setting. For example, if you are incapacitated, what will happen to your legacy and everything you’ve acquired and achieved by then?
If this question has bothered you for quite some time, you’re at the right place. We will discuss with you some basic things you need to know about estate planning. Below are the key elements you need and the mistakes you must avoid.
Key Elements in Estate Planning
An estate plan involves plenty of legal documents and law professionals for it to be executed. Besides learning about the different steps you need to take, every estate plan requires at least four key elements, and we’ve written them down below.
Last Will & Testament
A last will & testament is a document that outlines all your assets and the beneficiary with whom you plan to leave each asset. Without this, the state court would be the one to decide on the fate of your estates.
Healthcare Power of Attorney & Living Will
There are cases where the client cannot speak or make decisions, and that’s why the healthcare power of attorney, combined with your living will, is important. The attorney or a person you trust will continue the execution of your living will. This also includes any wishes regarding the use of life support or how your assets can be used to pay for hospice care in a nursing home.
Financial Power of Attorney
Aside from the healthcare power, there is also the financial power of attorney. The main difference is that instead of healthcare decisions, a trustee would be granted the power to decide your finances. This is important because you may be leaving behind some investments, unpaid or pending bills.
Lastly, you will need a trust as part of your estate plan. This dictates your wishes regarding how you want your children or other beneficiaries to be handled regarding your estates. This may indicate how or when your beneficiaries will receive your assets once you’re gone.
Estate Planning Mistakes to Avoid
Because of the taboo of talking about death or simply the general disinterest of the wider population on the importance of estate planning, it’s rather common to establish an estate plan that’s riddled with holes. To avoid that, here is a list of some of the most common estate planning mistakes.
Failure to Update Plans
One common misconception about estate planning is that you can set it aside once you’ve written it and forget about it. However, as dynamic as our lives can be, we sometimes hit major setbacks or milestones and even shift our goals towards something we value more. When these happen, make sure that you update your plans to coincide with your current vision.
Disregarding Disability and Long-Term Care
Believe it or not, the cost of caring for you when you get old ranges from $15,000 to $100,000 annually. The sad part is that many people disregard this inevitable truth. While you’re still young, make sure that you have proper life insurance when you reach old age to prevent your family from running out of funds.
Improper Asset Ownership
Some people start writing their estate plans without really checking the ownership of their assets. Sometimes, we are provided with businesses or properties that are transferred through word of mouth without any legal document that supports it. This will be a problem as you won’t be able to transfer your estates if you don’t have rightful ownership of them in the first place. Make sure that you consult your legal adviser when this happens.
Not Planning for Your Children
We work hard not just for ourselves but for the future of our children as well. Our success story is the denominator that determines whether they live a comfortable life or not. With that in mind, make sure that you have a detailed plan for your children when writing your estate plan. Include wishes, a guardian, and how your assets would support your children in the event of your death.
We understand that estate planning is a complicated process, but we all have to realize its importance before it’s too late. After all, our pursuit of success is dedicated to our loved ones. Let us all make sure that this is realized with the support of the law. By understanding how to write an estate plan properly, you can guarantee a more comfortable future for you and your loved ones.
Meta title: How to Successfully Write an Estate Plan
meta desc: We should be able to talk about death and old age openly. It’s inevitable, and we have to be prepared. You can do that by writing an estate plan.