No one likes to think about death, but giving some thought to how you want your belongings distributed after your passing can be helpful. Estate planning is a process that living people complete in order to ensure that their assets are distributed according to their desires. The estate planning process can also help reduce the amount of stress your loved ones feel after your passing.
Here are three basic estate planning documents that you need to prepare as you begin your estate planning journey.
1. A Power of Attorney
A power of attorney gives someone the legal authority to act on your behalf. There are a few different types of documents that you can prepare in connection with a power of attorney.
A durable power of attorney provides the named individual with the ability to make both medical and financial decisions in the event you become too ill or incapacitated to do so.
A special power of attorney is more limited in scope. This document will only allow the named individual legal authority to act on your behalf under very specific conditions.
A medical power of attorney is designed to give a trusted loved one the ability to make important medical decisions when you aren't able to do so for yourself.
An experienced estate planning attorney will be able to help you determine the power of attorney that will best serve your needs.
2. A Trust
A trust is a document that authorizes you to title all of your important assets to a trust account that is managed by a third-party individual.
Trusts play a critical role in the estate planning process. Any assets that are held in trust are removed from your personal estate. This means that there will not be any assets left for the probate court to handle after your passing.
Establishing a trust can help your loved ones avoid the stress of probate court and ensure that your wealth is distributed as quickly as possible after you pass away.
3. A Will
Wills are the most commonly recognized estate planning documents. A will should include very specific details about your belongings, your designated heirs, and the identity of your preferred executor.
Individuals who pass away without a will leave their loved ones to deal with intestate succession. Intestate succession places the authority to distribute your assets into the hands of the state court.
Work closely with an experienced estate attorney to draft a will that will prevent your loved ones from being burdened with intestate succession after your death. For more information, contact an estate planning lawyer near you.