If there’s one thing the COVID-19 pandemic has taught us, it’s that life is often shorter than we wish it could be. Even people in perfect health have had to think about what would happen if they or another loved one passes before their time. It’s a sad fact of life—but it’s also an opportunity to review your estate planning needs.
Estate planning is useful for everyone, whether your assets are worth $10,000 or $10 million. It’s not solely about who gets what when you die. Estate planning also allows you to designate who will care for your finances and your medical decisions if you are unable. It can help you plan for retirement, as well as ensure your loved ones are protected in case of unforeseen circumstances.
Set up powers of attorney
As the pandemic continues, its severity has lessened. Even so, it’s smart to set up or review your powers of attorney.
Giving someone a medical or financial power of attorney gives them the legal right to make decisions on your behalf if you are incapacitated or otherwise unavailable. For instance, military members may give a trusted family member financial power of attorney while they’re deployed. However, a financial power of attorney also gives someone the right to take care of your assets (paying bills, filing taxes and more) if you are medically unable to make your own decisions.
Medical power of attorney is equally important. By designating someone to make healthcare decisions on your behalf, you can rest assured that your wishes will be carried out—even if you can’t express them yourself.
When designating powers of attorney, it’s important to choose people whom you trust, and who have the skills to carry out your wishes.
Review your will
Next, review your will—or create one, if you don’t already have one. Major life events, like marriages, divorces, births, deaths and other changes of circumstance can affect your asset distribution. It’s good practice to periodically review your will, then work with your estate planning attorney to update as necessary.
Consider setting up trusts
Finally, consider setting up trusts for your beneficiaries. Trusts can help with a number of different goals, from protecting lump sums against spendthrift beneficiaries to planning for Medicare or Medicaid and more. With strategic trusts, you can ensure your assets are safe, protected and less likely to be contested in the probate process.
Do I need an estate plan?
If you’re relatively young, single and don’t have many assets, you might not feel having an estate plan is necessary. However, everyone benefits from an estate plan—even if you only set up powers of attorney for emergencies. Think of estate planning as one of the kindest things you can do for your loved ones. In the event of an emergency, they won’t have to try to figure out what you would have wanted them to do.
When you need estate planning assistance, reach out to Ruben J. Padron, PA to schedule a consultation.
Categorised in: Estate Planning