You’ve enjoyed a successful career, perhaps establishing a profitable and growing business. Now, how do you protect it and ensure that you can pass it along to your loved ones efficiently and without worries when the time comes.

In this article we talk about the importance of proper estate planning. Most importantly, being sure you have all your most important estate planning documents in place and keeping these documents up to date.

Types of Estate Planning Documents

 Here are the most important estate planning documents:

  • Healthcare Power of Attorney (HCPOA): Not having a HCPOA can leave you in the position of being kept on life support indefinitely, according to state laws and hospital policy, perhaps contrary to your own wishes. Similar to a durable power of attorney, a Health Care Proxy appoints an agent to make health care decisions for you when you can’t do so for yourself, whether permanently or temporarily.
  • Guardianship of a Minor Child (GMC): First and foremost, this makes certain that your young children, and sometimes even grandchildren, are being taken care of before worrying about your money and assets.
  • Will: This is the cornerstone of proper estate planning and the most important document to get right and kept up to date. A proper will gives you the power to decide how your estate will be disbursed. It allows you to choose your own personal representative (called an executor) to take care of your estate, including distributing your possessions, paying bills, filing your tax returns, and closing out your accounts. It’s best that you choose who serves in this key role.
  • Trust: Second-only in importance to your will, not having a proper trust in place could lead your estate right into probate, an expensive, time-consuming process. A living trust is a legal entity you create to own property, such as your home or investments. You control the property in the trust, and can change the trust terms, transfer property in and out of the trust, or end the trust altogether. A proper trust should deliver significant estate tax savings for you and your heirs. And a trust can also give you asset protection from future creditors.
  • Durable Power of Attorney (DPOA): A Durable Power of Attorney (DPOA) can help protect your property in the event you become physically or mentally incapacitated and unable to handle your financial matters. It allows you to authorize someone else to act on your behalf. This is especially important to business owners. Without it, your family or business associates may have to go to court to seek the appointment of a conservator.
  • Advanced Medical Directive (AMD): This important document will let others know what medical treatment you want or allows someone to make medical decisions for you. If you don’t have an advanced medical directive, medical providers must prolong your life using artificial means, if necessary, according to state law and hospital policy.

Keeping Your Estate Planning Documents Up to Date

Many people review their estate plan at a regular frequency, often when they review their overall financial plan. This can be done annually, semi-annually, or quarterly. In addition to a regular review, it’s a good idea to review and update your estate plan after any life events like the following:

  • The birth or adoption of a new child or grandchild, or when they become adults
  • Illness or disability of your spouse
  • Purchasing of a home, business, or other large asset
  • Any large increase or decrease in the value of assets, such as investments
  • Changes in federal or state laws covering taxes and investments
  • Career changes, such as a new job, promotion, or if you start, expand, or sell a business

Reviewing your estate plan at regular intervals in addition to major life events will help ensure that your legacy, both financial and otherwise, is passed on in accordance with your wishes and that your beneficiaries receive their benefits as smoothly as possible.

Bottom line: A proper estate plan, including having all your most important documents in order, and as up to date as possible, can provide valuable peace of mind for you and your family. If you have questions regarding your estate plan or if you need guidance in establishing one, contact us today at (772) 257-7888.