Many people who are not well acquainted with what estate planning entails think that estate planning equals a signed, valid will or a trust. Actually, there is much more to estate planning than just having a will or a trust. In fact, there are several different elements that are essential for your estate plan. Having an all-inclusive estate plan is not only important for you, it is also critical for your descendants after you have passed away.
As a concept, estate planning documents serve an important purpose. If your estate plan was created properly, it will contain a health care power of attorney and a document that gives your loved ones power to make decisions for you in the event that you become incapacitated.
What are the takeaways regarding my estate plan?
There are several nuggets of information that you will want to retain if you are at the beginning of the estate planning process (or even if you are further along in the process). It is never too late to learn and thus to apply new information to improve your estate plan.
- An estate plan is not only for people with valuable assets: Estate plans are of benefit to absolutely everyone. An estate plan is not only good for whatever assets you do have but it is also important for your finances, which you undoubtedly will want taken care of properly after you pass away.
- The importance of a will: If you don’t have a will, your assets may end up being distributed according to state law instead of according to your wishes.
- Another reason for estate planning: Estate planning is also important if you should become incapacitated.
- The will: Your will is a part of your estate plan, not the whole plan.
- If your children are minors: If your children are underage, it is essential to have an estate plan because your will lists your children’s guardian(s) if your spouse is not able to take care of your children for some reason.
Which documents should be in my estate plan?
There are several documents that should be a part of your estate plan:
- Will and/or trust
- Durable power of attorney
- Designation of beneficiaries
- Letter of intent
- Health care power of attorney
- Designation of guardian(s) for your minor children
In addition to those documents that were already listed here, some additional elements that can be important to your estate plan are insurance policy (to take care of you in your old age), a lifetime annuity so that your estate will have income after you are no longer here and a life insurance policy that can be passed down to your beneficiaries. That will eliminate the need for probate.
Sound advice from a Virginia estate planning attorney
You have worked hard to acquire everything that you have and as emotionally painful as it is to think about anything that happens after you are no longer around, it is still essential for you to lay the groundwork so that everything happens according to your wishes after you have passed away. It is essential that you create an estate plan that works effectively so that you have peace of mind that your loved ones will be taken care of properly after you are gone and so that your wishes will be carried out exactly as you wish them to be.