When it’s time to make arrangements for your final wishes, you might ask what are the 5 components of estate planning? A will is just the beginning.
Estate planning is an important step that involves preparing and managing the whole of your assets ahead of your death. It is a comprehensive approach that involves several moving parts that help to ensure that your final wishes are carried out and that your loved ones are taken care of.Â
Today, our estate planning attorney offers Franklin, TN, answers the question: what are the 5 components of estate planning?
Will And Trusts
You’re probably already familiar with a will. This legal document outlines a person’s wishes for what will happen to their assets after their death. Without a will, the state will step in, and your intended heirs may have to wait months for their inheritance. In addition to a will, trusts are another vehicle involved in estate planning that can help to protect and distribute assets. Trusts are legal entities that can be set up to manage assets for you and your beneficiaries, providing greater control over how and when assets are distributed. Unlike a will, a trust can take effect while you are still alive, and depending on the type of trust you form with your estate planning attorney, you may add or take away from the assets held within it.
Powers Of Attorney
Powers of attorney is a legal status that gives someone else the authority to make choices for you that are in your best interest if you can’t make decisions. There are different types of powers of attorney, including financial and medical. A financial power of attorney gives someone else control over your finances if you become permanently or temporarily fully disabled; a medical power of attorney permits somebody to make medical decisions for you under the same circumstances. Your state planning attorney can help you set up each type of document.
Beneficiary Designations
A beneficiary designation is essentially a detailed set of instructions that shows to whom your assets are distributed. Not all assets have beneficiary designations. Those that do include life insurance policies, retirement accounts, and bank accounts. If you haven’t looked at these types of assets lately, take a look to see who the current beneficiaries are. If your circumstances have changed, such as if you are divorced or your beneficiary has passed, you want to change those before you are unable.
Guardianship
If you have minor children, you want to talk to your estate planning attorney about setting up a guardianship agreement. This appoints a trusted friend or family member, such as a sibling or godparent, as the person your children would be cared for by in case of your death. Without appointing a guardian, the government will decide who your children go to.
Health Care Directive
Even if you already have a medical power of attorney, it’s a smart move to also have a health care directive. This puts you in charge of your end-of-life care well ahead of the need. Your healthcare directive might specify whether you wish to be put on life support or not. Your estate planning attorney might recommend that you discuss your health care directive with your family so that they know what to expect when the time comes.
When it’s time to plan your estate, you can’t just tell your loved ones what you want them to have. There are many different components of an estate plan, including wills, trusts, and guardianship appointments. While you may not need all of these, your estate planning attorney can help you lay out a plan for your end-of-life wishes while you are still in control.
The Linville Estate Law, PLLC offers estate planning, probate and trust administration, and other services throughout the Franklin, TN, area. Linville holds a law degree from Belmont University College of Law and is a proud member of the Tennessee Bar Association, the Williamson County Bar Association, and the Maury County Bar Association. Linville also serves on the Springhill Board of Mayor and Aldermen. He chose estate planning as a way to help the members of his community best protect their loved ones. For custom estate planning solutions, contact the Linville Estate Law, PLLC today.
