Thinking about being too sick or hurt to take care of your own things can be worrying. Will your kids fight about what kind of care you will receive? Will someone make choices for you that you would not have made for yourself? What will happen to your finances without you to manage them?
This is where an effective estate plan comes into play. It’s not just about deciding what happens to your assets after you pass away. An estate plan can also protect you and your interests if you can’t make decisions for yourself. How does your plan help?
A power of attorney lets you choose someone to make financial choices on your behalf.
A power of attorney lets you choose someone you trust to look after your finances if you cannot do it yourself. A regular power of attorney stops working if you become incapacitated, but a durable one keeps working, making sure your money matters are taken care of the way you want.
A health care proxy can make choices about your care.
A health care proxy lets you choose someone to make medical decisions for you if you can’t say what you want. This can include all kinds of medical decisions, from regular care to important life-saving choices.
You can outline your wishes in a living will.
A living will, or advance directive, is a document where you write down the medical treatment you want or do not want if you cannot talk about it yourself. It is important for decisions about end-of-life care. Having a living will can make things easier for your family, so they don’t have to guess what you would have wanted.
A trust can ensure someone manages your assets in an emergency.
Creating a trust allows you to transfer the ownership of certain assets to trust, which a trustee manages for the people you choose to benefit from it. If your health prevents you from managing the trust, the person you picked as your successor will keep managing the trust so that it’s done according to your instructions. This can be especially helpful for certain assets like businesses, ensuring that they can continue to operate without your management.
Life can be unpredictable. Having an estate plan in place can protect not only your assets and wishes but also alleviate the emotional and financial stress on your family and loved ones.