« Back to Glossary Index
Estate planning is the process of arranging for the management and distribution of your assets in the event of your incapacity or death. 1 It’s about ensuring your wishes are carried out and providing for your loved ones. Here’s a breakdown:
Key Aspects:
- Asset Distribution:
- Estate planning involves determining who will receive your assets (property, money, possessions) after your death.
- Guardianship and Care:
- It can also include designating guardians for minor children or dependents with special needs.
- It can address how you want your healthcare and financial decisions to be handled if you become incapacitated.
- Legal Documents:
- Estate planning typically involves creating legal documents, such as:
- Wills: Outlines how your assets will be distributed.
- Trusts: Legal arrangements that hold assets for beneficiaries.
- Powers of Attorney: Authorizes someone to make financial or healthcare decisions on your behalf.
- Advance Directives (Living Wills): Specifies your wishes for medical treatment in case you become unable to communicate.
- Estate planning typically involves creating legal documents, such as:
- Tax Considerations:
- Estate planning can help minimize estate taxes and other related taxes.
- Peace of Mind:
- A well-crafted estate plan provides peace of mind, knowing that your affairs are in order and your loved ones are protected.
The Misconception: Estate Planning is Only About What Happens After You’re Gone.
The Interesting Angle: Estate Planning is Like “Setting Up a Control Panel for Your Life” – It’s Actually About What Happens While You’re STILL HERE, Especially If Things Go Wrong.
Here’s how we break it down:
- The Common Misunderstanding:
- People think estate planning is just about writing a will and deciding who gets their stuff after they die. They don’t realize it’s about much more.
- The Real Story: Setting Up a Control Panel for Your Life
- Think of estate planning as setting up a “control panel” for your life. It’s about having a plan for when you’re still alive but can’t make decisions yourself.
- This “control panel” lets you:
- Choose Your “Backup Pilot”: Who makes your medical decisions if you can’t? (Power of Attorney for Healthcare)
- Decide Your “Emergency Settings”: What medical treatments you want or don’t want. (Living Will/Advance Directives)
- Pick Your “Financial Manager”: Who pays your bills and manages your money if you’re unable to.(Power of Attorney for Finances)
- Keep Your Life Running Smoothly: Avoid court battles and family stress by having a plan in place.
- It is about being prepared for unexpected events while you are still alive.
- Why This is Powerful:
- It shows that estate planning is about more than just death; it’s about life.
- It emphasizes the importance of having a plan for unexpected events.
- It gives people a sense of control over their lives, even in difficult situations.
- The “Get it Wrong” Factor:
- People think it’s only about stuff, not about their health and well-being.
- They don’t realize that they can choose who makes decisions for them, even before they die.
- They think it’s only for the end of life, and not for unexpected issues that could happen at any moment.
Resources for Estate Planning
- National Institute on Aging (NIA):
- The NIA provides information on legal and financial planning for seniors, including estate planning.
- They offer resources that explain the importance of estate planning and the various legal documents involved.
- Link: https://www.nia.nih.gov/health/legal-issues/advance-care-planning
- AARP (American Association of Retired Persons):
- AARP offers a wealth of information on estate planning, including articles, guides, and tools.
- They provide resources on wills, trusts, powers of attorney, and other estate planning documents.
- They also offer information on financial planning and legal considerations related to estate planning.
- Link: https://www.aarp.org/money/estate-planning/
- American Bar Association (ABA):
- The ABA provides information on various legal topics, including estate planning.
- They offer resources to help you understand the legal aspects of estate planning and find qualified attorneys.
- They also have publications and guides on estate planning.
- Link: https://www.americanbar.org/groups/real_property_trust_estate/
- National Academy of Elder Law Attorneys (NAELA):
- NAELA is an association of attorneys who specialize in elder law, including estate planning.
- They provide a directory of elder law attorneys and resources on various legal issues affecting seniors.
- They are a valuable resource for finding qualified attorneys who specialize in estate planning.
- Link: https://www.naela.org/
- LegalZoom or similar online legal services:
- While not a replacement for a lawyer in complex cases, these services provide access to templates and information to help people create basic wills, and other documents.
- These can be a good starting point for people with very simple estates.
- It is always recommended to have any legal document reviewed by an attorney.
- Link: LegalZoom (as an example): https://www.legalzoom.com/
Important Considerations:
- Estate planning laws vary by state, so it’s essential to consult with an attorney who is licensed in your state.
- Estate planning is an ongoing process, so it’s crucial to review and update your plan periodically.
- Consider your specific needs and circumstances when creating your estate plan.