Keeping estate planning documents current is necessary. Life changes—so relationships, assets, and laws change. Outdated documents can lead to a multitude of issues like assets going to unintended beneficiaries or medical decisions being made contrary to your wishes.

 

Crafting a Will That Reflects Your Desires

A will is a legal document that communicates how you want your estate, which includes property, finances, and personal items, to be managed when you are no longer here. To write a will, you must be an adult of sound mind, capable of making decisions about your estate. You will need to appoint an executor—a person or institution responsible for carrying out your directions.

The first step in crafting your will is to take inventory of what you own. Your assets may include homes, land, vehicles, savings, investments, jewelry, and other personal possessions. It’s important to consider digital assets, such as online accounts and digital properties, which are becoming increasingly important.

Decide who will receive each asset. These recipients are known as beneficiaries, and they can be family members, friends, or even organizations and charities you want to support. Be clear about who gets what, as ambiguity in your will can lead to challenges in court.

Your executor will have the responsibility of carrying out the instructions in your will. This individual should be reliable and organized, with the capacity to handle potentially complex financial matters and interpersonal dynamics that may arise. It’s advisable to name an alternate executor if your first choice cannot serve when the time comes.

If you have children or other dependents under legal age, your will should address their care. You can name a guardian to take responsibility for their upbringing, and you might also want to set up trusts to provide for their financial needs until they reach adulthood.

Your will should acknowledge any debts and taxes that need to be paid from your estate. These liabilities must be settled before the distribution of assets to beneficiaries. Laying out instructions for these obligations can aid your executor in managing your estate effectively.

For your will to be legally valid, you must sign it in the presence of witnesses. The requirements for witnesses can vary by jurisdiction, but typically, two witnesses who do not stand to inherit anything from your will are needed. These witnesses must see you sign the document and then sign it themselves.

Store it in a secure location and inform your executor or a trusted individual of its whereabouts. Equally important is the need to review and update your will periodically, especially after major life events like marriage, divorce, having children, or significant changes in your finances.

Consulting with a legal professional ensures that your will adheres to state laws and considers all potential complexities. An attorney can provide invaluable guidance, helping you to avoid common mistakes and ensuring your will is clear and enforceable.

 

Power of Attorney

A power of attorney is a document that grants another individual or organization the authority to act on your behalf in specified or broad financial and legal situations. This authorization can include paying bills, managing investments, selling property, and even making legal choices that would normally require your direct input.

There are several types of powers of attorney, each tailored for distinct circumstances:

General Power of Attorney allows broad powers to the agent to manage a wide array of affairs.

Durable Power of Attorney retains its effectiveness even if you become physically or mentally incapacitated.

Springing Power of Attorney only becomes active upon the occurrence of specific events, commonly the principal’s incapacitation, as determined by medical professionals.

Limited or Special Power of Attorney grants authority to the agent for specific tasks, such as selling a property, and usually for a limited time.

The person you choose to grant power of attorney – often referred to as the agent or attorney-in-fact – bears significant responsibility. This individual should be someone you trust implicitly, who understands your values and is capable of managing affairs in a manner you would approve of. Given the weight of their role, it’s necessary to discuss your expectations thoroughly and ensure they’re willing and able to take on this duty.

A durable power of attorney for health care designates someone to make medical decisions for you if you become unable to do so. They will work alongside healthcare providers to ensure that your medical care aligns with your preferences, as detailed in your living will or discussed with them.

Follow your jurisdiction’s requirements regarding document preparation, signing, and witnessing. It must be signed by you, the principal, and witnessed by adults who comprehend the document’s significance but are not named within it. Certain states may also require the document to be notarized.

Your circumstances or relationships may change, and you have the right to revoke or alter a power of attorney at any time, provided you are still competent. To do so, provide written notice to your agent and any institutions or parties they interact with on your behalf.

Encourage your agent to keep meticulous records of all transactions made on your behalf. This transparency is necessary for bookkeeping purposes and provides a trail of actions taken, should any questions arise in the future.

 

Starting the Conversation

Starting the conversation early allows for clear communication and prevents misunderstandings or conflicts after you’re gone or if you become unable to articulate your desires.

Choose a moment when all relevant parties are present, such as a family gathering or during the holidays. Ensure that there is sufficient time for a thorough and unrushed discussion. Aim for a calm and comfortable setting where everyone feels open to listening and sharing.

Consider how your family typically handles serious discussions and plan your approach accordingly. You may want to introduce the subject gently, perhaps by sharing a relevant experience about a friend or relative that highlighted the importance of estate planning for you.

Outline the purpose of the conversation and stress the significance of having everyone on the same page. While the details may vary, your overall goal is to ensure that everyone understands the process and your intentions.

Explain the decisions you’ve made and the reasons behind them. Allow them to ask questions and voice any concerns they may have.

While the final decisions are yours, showing openness to feedback can make your loved ones feel involved and respected. Listen attentively and address any issues raised. Assurance that their viewpoints matter can ease acceptance of your estate plan.

Encourage your family members to think about their plans. This emphasizes the universality and prudence of having one’s affairs in order.

 Encourage open channels of communication and set future dates to revisit the discussion. As life evolves, so too will the conversation about your estate plan.