Planning for one’s death is never pleasant; however, as many Colorado residents may already know, it is often a fact of life. This is especially true when there are numerous assets that must be given away as part of one’s estate. An authority on the subject in a recent piece provided some guidance on which documents should be included in every estate plan.
The first major document that is recommended for inclusion is a will or living trust. Depending on the person’s individual financial situation, either could be appropriate. A will does not deal with issues of taxation, but a trust does. A trust is a better option, generally, for those who may be hit with estate tax or have some other special situation. The important thing is that there is a document to direct dispensation of assets; the alternative is leaving the estate to be divided by a state law scheme.
Other documents recommended by experts include those that dictate what should be done should a person become incapacitated. An advanced medical directive, otherwise known as a living will, is helpful should a person no longer have the ability to make medical decisions. This document will avoid burdening family members with choices such as whether or not to remove life support. A durable power of attorney is also important as it allows another person to write checks and handle financial matters in the event of incapacity.
Having all of the proper estate planning documents is extremely important in order to retain control over how assets are dispensed after one’s death. An attorney who has experience in the area of estate planning may be able to help ensure that these documents are thoroughly and strategically drafted.
Source: Daily Finance, “Documents that should be part of everyone’s estate plans“, Andrea Murad, September 06, 2013
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