Basic Estate Planning Documents Checklist: 4 Documents You Need

Jun 23, 2023 | Power of Attorney, Trust, Wills

Estate planning is an essential mechanism for ensuring that your financial legacy is distributed according to your wishes, which allows you to continue supporting the ones you love and to address additional concerns, such as guardianship of any minor children. While it may seem daunting, setting up a comprehensive estate plan doesn’t have to be as complicated as you may think. The peace of mind that comes from knowing you’ve taken care of this critical task can prove invaluable

A reputable online estate planning company that allows you to create and securely store your estate planning documents can help at an affordable rate.

A Will Distributes Assets upon Death

Your will lays out exactly how you want your assets to be distributed upon your death. While some wills are elaborate, others are very straightforward – depending upon the size and nature of the estate and the wishes of the person. If you pass without creating a legally binding will, your estate, which refers to any assets that aren’t in a trust, will be distributed among your relatives by the laws of intestacy in your state. 

When you create your will, you’ll assign an executor who will oversee the distribution of your assets when the time comes. While you can address your financial assets with other estate planning tools, you’ll need the will to address the guardianship of any minor children – in the unlikely event, both you and their other parents die before they reach adulthood. 

There are also financial matters that wills cannot control, including:

  • Life insurance policies and other financial tools that are distributed to named beneficiaries
  • Any assets that are held in joint title

Wills are implemented through the state’s probate process, which is a court matter. 

 

A Power of Attorney Manages Finances

When you assign power of attorney (POA) to an individual, you authorize them to handle your financial decision-making if you are unable to do so. A POA can be set up to go into effect only in response to your incapacitation, or it can be set up as a matter of convenience, such as when you are out of town, and documents need to be signed or business needs to be taken care of.

The person to whom you assign the role of POA only has the authority to make the exact kinds of decisions and to engage in the exact kinds of transactions that you specify. A financial POA grants only financial authority, which does not extend to making medical decisions on your behalf, and this authority remains in effect only during your lifetime. 

Advance Care Directives Manage Your Health

To address your wishes as they relate to end-of-life care or healthcare decisions that need to be made due to your incapacitation, you’ll need an advance care directive. If you have specific preferences, this is your opportunity to outline them for whoever will be making decisions on your behalf. 

This estate planning tool is often called a living will. Depending upon the state you live in, you may be able to assign a healthcare power of attorney to make the necessary decisions on your behalf within this document. When this isn’t the case, however, filing a separate healthcare power of attorney is necessary. 

 

A Living Trust is an Alternative to a Last Will

A living trust can address many of the same financial concerns a will can – while streamlining the process. A living trust is a tool that allows you to put specific assets that belong to you into the ownership of a belief that you create during your lifetime. In the process, you assign a trustee – whose job it is to manage how the included assets will be distributed according to your wishes upon your incapacitation or death. 

Your Living Trust Bypasses Probate

Your living trust is a private matter, which means it won’t need to go through the probate court process – unless there are disputes among the named beneficiaries or presumed heirs. Having a valid living trust in place can save your loved ones both time and money – at a time when they are also facing considerable grief and stress. 

A Will Is Also Recommended

As mentioned, only a will can address the matter of your minor children’s guardianship – a living trust cannot serve this purpose. Further, because you may come to own assets that you don’t include in your living trust – often due to time constraints – having a will in place to address these items is always a good idea.

For example, if you win the lottery or come to own other valuable assets before death and don’t have time to update your living trust accordingly, the distribution of these assets will need to be resolved according to the laws of intestacy, which tends to be legally challenging, time-consuming, and costly. 

Often, the wills that are created in addition to living trusts are called pour-over wills because they take care of anything that isn’t included in the trust.  

 

TrustHandled Can Help You Get Your Estate Planning in Good Shape

At TrustHandled, we recognize how important taking care of your estate planning needs is for your peace of mind, and we’re here to help. Our goal is to help you better understand the process and help you access the estate planning tools you need – without all the complications, confusion, and costly expense. 

Estate planning affords the opportunity to effectively and efficiently distribute everything you’ve worked so hard for in this life to those who are most important to you. Too many people put off estate planning because they find it intimidating. Still, TrustHandled is committed to shifting this mindset by offering an online template for estate planning documents, clear instructions, and secure online storage that ensures the estate planning tools you create are ready to be accessed when they need to be. 

Latest Articles

Jul 06 2023

Where Can I Get a Power of Attorney Form?

Power of attorney refers to a legal document that allows someone to act for you – whether out of convenience or out of necessity. For example, if you have to be out of...
Jun 24 2023

What Is a Trust?

A trust can be a powerful tool in your estate planning efforts. Your estate plan is a clear symbol of the time and care you have poured into protecting your financial...
Jun 24 2023

Printable Last Will and Testament Templates

Your last will and testament is a legal document that helps support your financial legacy, which makes it important to your peace of mind and to the future of your...
May 11 2023

Who Can Override a Power of Attorney?

Life can be unpredictable, and our decisions aren't always clear-cut. To be prepared for changing circumstances, it is essential to have certain legal safeguards in...
May 11 2023

The 4 Types of Powers of Attorney in California

Individuals who want to preserve their assets for their relatives after their passing can set up trusts or wills as part of their estate plan. However, not all aspects...
May 11 2023

Texas Medical Power of Attorney Requirements

Preparing for potential medical emergencies is important in creating a comprehensive estate plan. If you become incapacitated due to an illness or injury, you may need...
May 11 2023

Should You Set Up a Revocable Living Trust?

Estate planning can be time-consuming and complex, but it is often well worth the effort. Developing a solid estate plan is crucial to protect yourself if you become...
Focused retired mature couple reviewing living will online documents together, visit TrustHandled to learn more.
May 11 2023

How to Write a Codicil to a Will

For those who want assurance that their assets will properly be distributed after they pass away, a last will is a common choice. With a will, an individual can specify...
May 11 2023

How to Fill Out a Self-Proving Affidavit

When it comes to estate planning, creating a last will and testament is one of the most important steps an individual can take to protect their loved ones after their...
May 11 2023

How to Change a Living Trust

A living trust is a tool individuals use as part of the estate planning process. The owner of the trust, or “grantor,” can revoke or change the trust instructions at...