How Does Your Estate Plan Stack Up?
While most of us know general information about estate planning, not everyone has one. Even if you do have a plan in place, what does it consider? Some estate plans aren’t set up for several “what if” scenarios, instead focusing on a person’s money and other tangible assets after death. As technology and medicine advance, there are more things to consider when developing an estate plan. Traditionally, we think of estate as cash, real estate, and personal possessions such as jewelry and furniture. In the last 15–20 years, estate planning has also included general and healthcare powers of attorney. As our lives become more complex, so does our estate plan, and there are even more considerations today than there were 10 years ago. If you don’t already have an estate plan in place, here are some suggestions for what you should consider when developing your plan. If you already have one, it can serve as a guide to measure where your estate plan stacks up.
Who should control money or make decisions before you die? As we continue to have advances in medicine, it’s important to specify one or more of your heirs to act on your behalf if you become incapacitated. This may include a coma, but these days it also can mean Alzheimer’s, dementia, or other illnesses that prevent you from making decisions. You may want a different person acting as your fiduciary than the person who will make healthcare decisions, but it could be the same person.
What should trigger - or terminate - your power of attorney? Traditionally, estate planners have written that two physicians should make the call. However, getting a second opinion isn’t as easy as it used to be. Many estate plans today have moved to a two-party decision, where one physician—usually your primary care doctor—plus a family member who won’t be acting as your fiduciary can determine that you’re incapacitated. Your plan should be written for the possibility of temporary incapacity.
Who should be your executor? Usually, you have the same person or people acting on your behalf prior to death be the executor of your estate. However, there can be reasons to select an alternate fiduciary after death.
What do you want to happen with your digital accounts? As noted above, it’s important that even if you don’t think there’s much of an online footprint to be concerned about, things like email and cloud storage space should be considered. Refer to our recent post about digital estate planning for more details.
How you’d like to distribute your possessions? Other than your cash assets, how do you want your property divided? For personal possessions, it’s always best to write a list for your heirs. Even if you have faith that your family members will agree on how to divide things like furniture, art, and dishes, it can still help to put it in writing for items of high value, whether that value is monetary or personal.
Discuss your wishes with your advisors and your family before having an attorney draft or update your documents. Because these are complex issues, don’t use fill-in-the-blank documents unless absolutely necessary (e.g., prior to an emergency surgery). If your estate plan is missing one or more of these elements, it’s time for a review. Contact one of DeLeon & Stang’s professionals today to discuss your estate plan.