Three Estate Planning Documents Every Person Needs (part 1 of 3)

Posted by Tracy Zihmer

What exactly is estate planning?  When someone tackles their “estate plan,” they are taking the time now to make certain decisions for when they are incapacitated or deceased.  A typical estate plan includes (at the bare minimum) the following documents:

- Last Will and Testament

- Financial Power of Attorney

- Healthcare Power of Attorney/Living Will

The Last Will and Testament is an important document that only comes into play when a person passes away.  The Will dictates what happens to a person’s solely owned assets.  Solely owned assets are the assets owned by a person that are not jointly titled and ­­do not have a beneficiary designation (for example—a bank account with just your name on it or a piece of real estate with your name only).  Typically, marital property is jointly titled and will pass to the surviving spouse without the Will.  Life insurance policies and retirement accounts/401ks have a beneficiary and those assets will pass to the named beneficiary.  The Will controls the other property that is not “told’ where to go.  With married couples, their Wills usually dictate the transition of their assets when both spouses die.  Wills will also include important provisions including the executor of the estate, guardians of minor children and distribution of tangible personal property (and pets). It may also include trust provisions for minor or adult beneficiaries, special needs trust planning and retirement account trust protection planning.