Since it is “National Estate Planning Awareness Week,” Forbes.com is offering some advice for estate planning in “5 Documents You Need to Avoid Costly Estate Planning Errors.” In agreement with National Association of Estate Planners and Councils, the organization behind this week of awareness, Forbes.com wants to be clear that estate planning is for everyone. Estate planning is not just for people who are of advanced age nor is looking ahead to secure a financial legacy only for people of great wealth.
Forbes.com recommends that adults have:
Durable power of attorney: This names a designee to take care of financial matters if you become incapacitated.
Advanced medical directives: With this document, you can outline medical treatments you want (and in some cases don’t want) so that if you cannot express yourself, your wishes can be carried out.
Will: This is your opportunity to decide how to distribute your assets after your death. If you don’t have a legally binding will, your state will decide how to distribute your assets.
Letter of instruction: This is not a legal document but you can include it with a will. This is a place for expressions of affection or other thoughts you want to share that would not necessarily be a part of a will.
Living Trust: This is also sometimes called a revocable or inter vivos trust. According to Forbes.com, “The primary benefit of a living trust is that your assets avoid probate, which can be costly and time consuming.” It also can keep information about your estate out of the public record since it is a separate legal entity.
Of course it is one thing to simply have these documents drawn up; being advised on a strategy to make the most of them is another. This is where a Fee-Only financial advisor can help you plan so you can maximize your financial legacy.