What is an Estate Plan and Why is it Important?
OK, we said it. It is the elephant in the room. The thing no one likes to think about. We are lawyers. It’s our job to know the law, to help protect you and your family, and to remind you to think about preparing for unfortunate events like disability and dying.
Anyone can get sick. Everyone will die at some point.
What are YOU going to do about it? Don’t think it can’t, or won’t happen. Look it up. According to the Social Security Administration, 25% of 20 year-olds will become temporarily disabled at some point in time before they retire. And, 100% of people will eventually die.
For more than 35 years, we have been helping our clients and their families to prepare for this eventuality. We are not doctors, so, how do we help? We prepare a tailored estate plan for our clients consisting of three different, but related documents, a health care directive, a financial power of attorney, and a will.
A health care directive empowers someone else to make medical and health related decisions on your behalf if you cannot. Do not leave these decisions in someone else’s hands. YOU know best what you want and do not want. This important document puts you in control of your medical decisions. Also, if you are a parent, once your child is over 18, they are considered an adult, which means as a parent, you can no longer make these decisions for them.
Second, we prepare a power of attorney. This designates an individual to control your finances if you are unable to. Someone needs to pay the mortgage. Someone needs to pay the student loan and car loan. If you are unable to do this and have not designated another, you could be at risk for delinquency. As a real life example, one married client had not completed her estate plan. She became incapacitated and her husband had not been designated as her health care proxy or as her power of attorney. Valuable time had to be taken for us to apply to the Court to have her husband appointed to make medical decisions for her as well as to pay her bills. While this woman’s spouse should have been spending time at her side in the hospital, instead took tremendous time, effort, and energy elsewhere.
Lastly, we prepare a Will. Admittedly, this does not benefit you directly but will help those you designate as your beneficiaries. You work hard. You value your assets, a house (or two), cars, jewelry, furniture, bank accounts, and other things you have worked a lifetime for. You should be the one to determine who gets what, and why. If you do not have a will, there are laws that determine who gets what. So, if you want Great-Aunt Bertha to get your Pez dispenser collection, you have to say so in your will. More importantly, you designate an individual as the caregiver for your children as well as responsibility for your financial assets for that individual to raise your children. If you do nothing else, don’t leave the question of who will raise your kids unanswered.
Is the conversation about your death exciting? No, but we can help to ease the process while helping you protect your most precious assets.