Estate Planning Is More than a Last Will and Testament: Most retirees know they should have a last will and testament. However, surprisingly few have updated wills. A recent article from msn.com, “6 Legal Documents That Most Retirees Need—but Don’t Have,” says only about 52% of retirees have a last will, and most lack other crucial documents needed to protect themselves and spare their loved ones additional grief. The documents discussed below should be part of your estate plan. If you don’t have them, consult with an estate planning attorney in your community, as they are state-specific.
Medical power of attorney or healthcare proxy. This document lets a person of your choosing make medical decisions on your behalf if you cannot. When would you need a medical POA? If you are terminally ill, seriously injured, in a coma, receive a diagnosis of dementia, or at the end of life, you need a POA. Not only does this document let you decide who will make these decisions, but it also alleviates tremendous stress, including a lifetime of second-guessing, by your loved ones.
Advanced directive or living will. You will have the opportunity to express your preferences for end-of-life care if you can’t communicate because of an illness, accident, or another condition preventing you from responding. The advanced directive doesn’t go into effect until you are unable to communicate. Use this document to express what kind of care and treatment you want and don’t want during an emergency and the exact circumstances in which you want your choices to be honored.
Financial power of attorney. People with a financial POA have chosen the person they trust most to act on their behalf when it comes to paying bills, running a household, overseeing investments, or even selling a family home. Here’s what most people don’t know about a POA: you can, and should, make it as personal as possible. If you want your sister to pay your bills but cannot make charitable donations, your POA can include this. If you don’t have a financial POA, loved ones will need to go to court and petition for guardianship, which is costly and time-consuming.
Funeral and burial arrangements. No one likes to think or talk about dying, funerals, or memorial services. However, if you don’t tell your loved ones what you want or make arrangements for yourself, loved ones or funeral homes will make those decisions for you. Whether you care about what service you have or don’t want a service at all, creating a plan will be a kindness to your family.
HIPAA waiver. Few people seem to be aware of the importance of a HIPAA waiver, which creates a lot of headaches for loved ones. If you haven’t signed a HIPAA waiver, doctors and insurance companies cannot speak with your designated person about your healthcare and insurance coverage. If you become incapacitated without a HIPAA waiver, your family won’t be able to receive updates on your care. The laws enforcing HIPAA are extremely restrictive, so this is a good document to have in place long before it’s needed.
Trusts. When you create a trust, you create a legal entity to own property, taking it out of your taxable estate. Trusts allow assets to pass directly to beneficiaries, and depending upon the type of trust you use, there are many different types, and you may gain substantial tax advantages. Your estate planning attorney will know which type of trust is best for the circumstances.
Estate Planning Is More than a Last Will and Testament: Everyone should have a last will and the aforementioned documents to protect themselves and their loved ones. Life happens, and this kind of planning is invaluable. Make an appointment to meet with an estate planning attorney to create your own estate plan. If it’s been more than three to five years since you’ve had your estate plan reviewed, it’s time to take care of it.
Reference: msn.com (Jan. 13, 2025) “6 Legal Documents That Most Retirees Need—but Don’t Have”
