When some people think of estate planning, they think of creating legal tools to help them shield their assets or protect their inheritances. While these goals can be important, they don’t give you a comprehensive understanding of what an estate plan is, and what it will do for you. And even though no two estate plans are perfectly identical, almost all of them rely on the same foundational elements. Let’s take a look at what these elements are.
Foundational Element 1. Your will.
If you want to get started with estate planning, a good place to begin is a last will and testament. Every capable adult has the legal right to create a will in which they express their inheritance decisions, as well as other important choices about what they want to happen after they die. Depending on the state in which you live, there are different types of wills you can create. However, almost every estate plan will include an attested will, which is made in writing, executed, signed by two witnesses, and notarized.
Foundational Element 2. Your revocable living trust.
The revocable living trust is usually more important when it comes to inheritance planning than your will. Though all plans will rely on a will, you will probably use your revocable living trust as the main device through which you pass gifts to others after you die. Revocable living trusts are flexible and easy to create, and unlike your will, are something you can use to help protect you should you one day become incapacitated.
Foundational Element 3. Your power of attorney.
Speaking of incapacitation, there may come a time in the future when you are no longer able to make choices or communicate with others. Should this happen you will need a durable power of attorney. Through your durable power of attorney you have the ability to give another person the legal authority to represent your interests if you lose your ability to make decisions. This person, called your agent or your attorney-in-fact, can make decisions on your behalf when you are no longer able to do so.
Foundational Elements 4 and 5. Your advance medical directives.
This category includes two important elements, but both of which serve similar purposes. In Florida, capable adults have the right to create a living will and a health care surrogate. A living will is a document that states what your medical choices are, while a health care surrogate is a document that will name a medical representative who can make medical decisions on your behalf if you become incapacitated. Both of these documents are often referred to as advance directives because they allow you to make medical decisions in advance of losing capacity.