Estate planning is probably one of the last things on the mind of Northern New Jersey residents. But, having an estate plan in place is important for almost anyone, regardless of income or life circumstances.
A will is one component of an estate plan. This is where a person can list who will receive what assets and they can also name guardians for their minor children. A trust is used to hold assets on behalf of a beneficiary and can also help the estate avoid probate. A power of attorney can be drafted, which appoints a person who is designated to manage finances if the estate planner becomes incapacitated. Important healthcare documents, including a healthcare proxy and living will, are also important parts of an estate plan. A healthcare proxy is a person designated to make healthcare decisions if the estate planner becomes incapacitated and unable to communicate. A living will gives healthcare instructions regarding medical decisions that may need to be made if a person becomes incapacitated. Finally, beneficiary designations on retirement accounts, life insurance and bank accounts, should be reviewed frequently.
Although no one wants to think about what will happen if they become incapacitated or what will happen to their assets and children if they die, it is important that it is dealt with while someone is able to make these important decisions. Estate planning is a way for a person to pass on their values to the next generation and can help a family feel at peace.
Estate planning is for everyone, regardless of circumstances. Each person's estate plan is unique based on their needs and assets.
Source: wealthenhancement.com, "The will and the way: 5 key elements of a good estate plan", Bruce Helmer, Sept. 30, 2015