Estate Planning is for everyone (even a busy superhero). Batman has Robin, Sherlock has Watson, and every president has her vice-president. Hopefully each one of us can name just one person that has our back. And an estate plan not only tells the world who that is, but our laws actually require us to document the person allowed to step into our shoes when we need help. Without the proper documentation, it’s just like driving without insurance and there is no “hotline” to call when you get into a pinch; or like trying to resolve an issue when the manager is on vacation and no one has the ‘authority’ to address your grievances.
One of the biggest obstacles to overcome in creating an estate plan is to figure out who you trust to handle your finances, care for your children and make important health care decisions. If you feel reluctant to depend too much on those in your “inner circle” just remember that the alternative is to ask a colleague, family member or a friend to “figure it out themselves” in a pinch.
The good news is that the “fiduciary” designations in your estate plan documents are simple to change. So, the sooner you get something in place, the better you can sleep at night. And even if you designate the “wrong” person, our laws still protect you because when a person assumes a fiduciary role (e.g., as an agent under a power of attorney, an executor of a will or trustee of a trust) she takes on an enforceable legal obligation to protect your interests.
Here are some examples of what your estate plan documents can do for you:
1. Grant conditional access to important information and resources you can’t get to because you are on vacation (physically or mentally…).
2. Protect your children (even adult children) from inheriting wealth that they are not equipped to manage wisely and also provide for elderly parents or young children in the event of your premature death.
3. Make sure that your pets can live a “good life” when you aren’t around.
4. Make sure that your spouse can pay the bills if you get stuck in an extended hospital stay by giving someone access to your bank accounts and maybe even your login information for your online bill pay accounts (in case you opted to save paper and have all your bills sent by email!).
5. Save you money by keeping your property out of probate court (and away from the government) when you die. Even a sophisticated estate plan that costs several thousand dollars will be less expensive than giving an attorney and executor a percentage off the top of your estate.
This blog post is just a 10,000 foot view of an estate plan. If you want to read more about each document that makes up the plan, check out our upcoming blog posts that dive deeper into the key components of a will, living trust, advance health care directive, and durable power of attorney.