We often talk about estate planning and the essential documents of a will, power of attorney and advanced medical directive in terms of the elderly. While it is certainly true the elderly need this sort of planning, the need for estate planning at different stages of life often is overlooked.
When a child turns 18 they are legally an adult, regardless of how much support they continue to receive from their parents. This means if something happens and the young adult is no longer able to voice their own decisions, a parent will not be able to make those decisions for them.
Often, the only recourse in this situation would be guardianship. Because of this, it is incredibly important for all young adults to have, at minimum, a power of attorney, advanced medical directive and health care surrogate.
These documents would allow someone to make medical, legal and financial decisions for the young adult if they are incapacitated.
A will, while an essential document, is not as important for people at this age unless they have an unusual amount of assets or they want their possessions distributed in a certain way.
As a person ages and begins their own family and gains more assets, a will increases in importance. It is important for young children to be protected and for your wishes for them to be laid out – even if you are no longer living.
A will can be written in such a way as to create trusts for any minor beneficiaries so that they will not receive an outright bequest. The terms of this trust can be set up to not only provide financially for minor children, but also can detail aspects such as guardianship, living arrangements and visitation in the case of both parents’ deaths. Setting up a will in this way should be a vital part of protecting any family.
As a person or couple ages, they often accumulate more assets and property. While a will can be helpful to dispense assets and property, it is not always the best document.
The probate process can be an extra complication at a time when your loved ones already are grieving and stressed. It also can be lengthy if there is property involved, especially if there is anything in another state. There also is the possibility of a will being contested.
No one wants to put their loved ones through this. Avoiding the probate process is one of the main reasons people turn to trusts. A revocable living trust often is the best choice for people who are approaching retirement. It protects assets and avoids probate, while still allowing the owner to maintain a high level of control.
As people age further, into their 70s and beyond, they often begin to think about how to pay for long-term care if it is needed.
The vast majority of people in the United States will be in a nursing home at some point in their life, which is incredibly expensive and quickly can result in a person using all of their carefully saved assets.
For this reason, people approaching this issue should consider putting their assets and property into an irrevocable trust. If set up correctly, these trusts can protect assets and allow a person to qualify for Medicaid without spending all of their money. Some control must be given up with an irrevocable trust, but the protection provided makes this trade off worth it for most people.
Regardless of a person’s stage in life and regardless of the way in which they dispense of their assets, certain documents need to be in place for a person’s lifetime.
Every adult needs a durable power of attorney so someone else can make legal and financial decisions on their behalf if they are incapacitated. Every adult also needs an advance medical directive and health care surrogate to make medical wishes known.
Planning ahead is never fun, but it is the best way to avoid an unpleasant situation and unintended consequences later. The best way to determine the best plan for you and your family is to determine your goal, look at your assets and overall situation and consult an experienced elder law and estate planning attorney.
This article provided by NewsEdge.