Estate planning is an important process that secures the financial future of your loved ones after you pass. Without having a plan in place, settling your financial affairs could have a long-lasting and costly impact for your family – even if you aren’t laden down with assets.
It’s always a good time to start the estate planning process. And, the good news is, it’s relatively simple to get started. It’s always highly recommended to speak to an expert about your estate plans. To start, think about putting together the following key documents you’ll need to put a robust estate management plan in place.
In this week’s blog, we’ll be listing the key documents needed for estate planning.
Will
Let’s start with the obvious document, your Will. This document serves a dual purpose in estate planning. It names an Executor to administer the estate, to handle all financial matters and tie up loose ends. It also crucially describes how your assets will be distributed to your Beneficiaries. Your Will is the cornerstone of your estate planning and should be your starting point.
Enduring Power of Attorney
An enduring Power of Attorney is a legal document that names one or more persons to hold power and authority to deal with your affairs and property if you are alive but are incapable of managing your affairs. This mechanism is limited to assisting with financial and legal matters and it does not authorize the Attorney to make medical, health care or personal care decisions on your behalf.
When the Enduring Power of Attorney is created, the individual creating it MUST have the required mental capacity to carry the action out of their own free will.
Representation Agreement
On the medical and personal care side, a Representation Agreement grants the ability to appoint a trusted family member or friend to make medical, health care or personal care decisions on your behalf should you become incapacitated. It’s an agreement that lets your voice be heard during medical care, with a trusted individual representing your interests while you’re still alive and receiving care.
Life Insurance
Life Insurance is another highly recommended aspect of estate planning. Should you pass suddenly, proceeds from a life insurance policy can be used to pay your final expenses, eliminate outstanding debts, or help your family to cover day-to-day expenses. Whether or not life insurance is a good investment for you will depend on your individual financial situation, as well as the length you’ll need coverage for.