In his article “Commentary: Where to start when creating an estate plan” (which I found at nwi.com on 4/10/22) Greg Chona helps to break down the “hurdles” of getting your estate plan underway but simply presenting information on the 5 basic documents as a starting foundation. I think it helps to overcome the idea that estate planning will be a long, complicated, and complex process. It doesn’t have to be … think of it as just one step after another. Read on for what the five documents are and what they do.
“The COVID-19 pandemic has made Americans even more aware of the importance of planning for the unexpected. While no one knows exactly what’s in store for the future, one thing you can do for your loved ones is create an estate plan that expresses your wishes in the event of incapacity or death. If you’re like a lot of people, you may not know where to start, but here are five documents that can form the foundation of a well thought out estate plan:
Last will and testament: This is the primary document that defines how you want your property and other assets to be handled. It also assigns guardians for minor children and even pets and it provides a place where you can name your executor, the person who will manage the dissolution of your estate. Your will can also include directions regarding your funeral arrangements, such as whether you prefer to be buried or cremated.
Power of Attorney (POA): This legal document identifies an “agent” or person who can act on your behalf. You can choose to be very specific or very broad in the authority you assign to the POA. In some cases, a different family member may be POA for finances and/or personal property while another person is assigned to make decisions regarding medical care.
Living will: Also known as an advanced health care directive, a living will conveys your wishes regarding end-of-life medical care. It spells out the extent of life-extending care you want to receive in case you are unable to communicate these preferences yourself. For example, you can request that medical personnel perform invasive life-saving procedures such as resuscitation or tube feeding as needed. Alternately, you can put in place a Do Not Resuscitate (DNR) order and request only comfort care.
Beneficiary designations: Beneficiary designations identify who you wish to receive a particular asset. These designations typically are made within the financial asset itself, such as a life insurance policy or an investment account. It’s important to keep your beneficiary designations up-to-date following a life change such as marriage, divorce, death of a spouse, or birth of a child.
Inventory of key documents and contacts: Once you have the top four legal documents in place, it’s prudent to think about how your loved ones will access your accounts once you’re gone. A document that lists everything from mortgages and other bills to bank accounts, insurance policies, real estate deeds, and other legal proof can be very helpful. Your executor will need passwords for online accounts and may need physical copies of birth, marriage, divorce, and Social Security records. Lastly, provide complete contact information for relevant parties such as your banker, lawyer, financial advisor, and insurance agent.
Although conversations about estate planning can be difficult, they’re critical to leaving the legacy you want. Talk with a trusted financial advisor who can review your entire financial picture and determine what steps you need to take to safeguard your estate.
Estate planning is all about protecting yourself, your hard-earned assets, and your loved ones. And who doesn’t want to do that? Sometimes it just takes a nudge to get started. Why not consider this your “nudge”? I’d be honored to help you with your estate planning needs. Feel free to visit my services page https://davidlefton.com/services/ and take the next step while you are there and schedule a consultation.
For more information about estate planning, probate, or trust administration in Cincinnati and throughout the rest of Southwest Ohio, and to review free resources regarding estate planning, probate, or trust administration, visit my website https://davidlefton.com/ If you have questions regarding this article or a particular legal matter, feel free to contact me at 513-399-PLAN (7526). David H. Lefton is an Estate Planning and Probate Attorney. He is a partner in the law firm of Barron, Peck, Bennie & Schlemmer.