Many young people fail to make estate plans. Sometimes, they do so because they feel they lack the time needed to create one. Other times, they do so because they question whether they have enough assets to merit creating one. In truth, everyone has the potential to benefit from having an estate plan in place.
An estate plan does not need to be complex and detailed to prove effective. Instead, having a relatively basic estate plan in place helps individuals express their wishes for the future and potentially save their loved ones time and money. A basic estate plan might include the following three components.
A will
A will is the most basic element of an estate plan, and it is also arguably the most important. When someone dies without a will, they die “intestate.” This means dividing up that person’s assets falls in the hands of the probate court. Having a will helps family members and other loved ones reduce the time or expense they might spend on the probate process.
A financial power of attorney
Having a financial power of attorney created helps ensure that someone responsible handles an individual’s financial affairs if that individual becomes incapacitated. The financial power of attorney grants someone specific access to bank and other financial accounts.
An advance directive
An advance medical directive allows someone to express their desires with regard to medical care, palliative care and similar matters should he or she suffer incapacitation.
None of the above-named documents have to be intricate to serve their purpose. However, having these three estate planning documents in place may go a long way in terms of helping individuals achieve peace of mind.