Raising a family can be one of life’s greatest joys, and this joy only continues once grandchildren are born. You may have worked hard at your job while raising your children to provide for their needs and give them all the opportunities you possibly could. Now you are retired in Arnold and are enjoying a more relaxed life and time with your grandchildren.
But have you considered what the future for your loved ones will be should you suddenly pass away? You may think that your assets will just be passed on to your loved ones without any action on your part and in a way this is true. If you do not have an estate plan, Maryland law will dictate who is to inherit your assets, and this could possibly leave out relatives, friends or charities you would have liked to see inherit something. It is better to be prepared with a well-rounded estate plan drafted sooner rather than later. What should you include in your estate plan? The following are four common documents people include in their estate plan to ensure their wishes both at the end of their life and after their death are met.
Document 1: A will
A will forms the cornerstone of a well-rounded estate plan. In a will you can lay out who is to inherit which assets upon your death. Your will allows you to leave an inheritance to whomever you wish, something that cannot happen if you die intestate. In addition, in your will you can appoint a person you trust to serve as the executor of your estate. An executor is tasked with carrying out the terms of your will. If you do not have a will, the state decides who will administer your estate.
Document 2: A trust
Sometimes having a will is not enough to ensure your assets are passed on as you wish. A trust is a more complex estate planning document. Like a will, it can lay out who is to inherit what. However, in a trust you can ensure that these assets will be available to pass on once you pass as these assets will have been placed in the possession of the trust during your lifetime. In addition, you can place contingencies on a person’s inheritance in a trust. For example, you may want a loved one to graduate college or reach a certain age before inheriting. Trusts can offer more protections and options than a simple will can.
Document 3: Power of attorney
There are two types of power of attorney that you will want to include in your estate plan. One is a medical power of attorney. The person designated as medical power of attorney has the right to make health care decisions on your behalf should you become incapacitated. The second is a financial power of attorney. The person designated as financial power of attorney will manage your assets and financial affairs should you become incapacitated. If you do not have power of attorney documents, the state will decide who will fulfill these roles and it can cause a lot of confusion and heartache for your loved ones during what is a difficult time.
Document 4: A living will
The fourth document that is often included in an estate plan is a living will. A living will is different from a last will and testament. In a living will you will outline what kind of end-of-life care you prefer. For example, if you are in a coma and are brain dead do you want to be placed on a ventilator or feeding tube? Or if you are in cardiac arrest, do you want CPR performed. Some people want every life-saving measure performed others believe that they would prefer to simply pass on. This is a very personal decision, so you will want to ensure you have it outlined in a legally enforceable document.
Learn more about estate planning
It is understandable if all this information sounds overwhelming. Estate planning is not always as easy as it may seem, especially if you have many assets or other complex life situations that necessitate a detailed, comprehensive estate plan. Do-it-yourself boilerplate estate plans often do not achieve the goals they set out to meet and can even cause problems down the road. Fortunately, those in Arnold who are ready to begin their estate planning journey can seek assistance along the way.