We plan vacations, we plan weddings, and we plan for retirement, but most of us avoid planning for two of the most important events in our lives, possible incapacitation and death. Good estate planning deals with both of these events. It can ensure that if you become incapacitated during your lifetime, you and your assets will be taken care of easily, inexpensively and without going to court. Proper estate planning will also allow for the transfer of your assets at your death as quickly and inexpensively as possible. Everyone needs estate planning whether their estate is large or small.
The odds are that most people will be incapacitated for some period of time prior to death. There are three basic documents used to plan for incapacitation: a living will, a special medical power of attorney, and a durable power of attorney.
A Living Will is a legal document that recognizes your right to give written instructions to physicians, hospitals and other medical care providers regarding your desire not to be sustained by machines and/or other extraordinary medical procedures if your condition is terminal and death is imminent, or if you are in a persistent vegetative state (i.e., brain dead).
A Special Medical Power of Attorney lets you name a person to make medical treatment decisions for you if you cannot make them.
A Durable Power of Attorney lets you name someone to act for you with respect to your legal and financial matters if you become incapacitated. A Durable Power of Attorney can, in most cases, avoid the need to have a court appoint a conservator over your assets and financial affairs.
There are two main documents used to plan for what happens after you die, Wills and Trusts.