When it comes to the impact of insurance on estate planning, most of this discussion will focus on disability insurance and life insurance. However, it's always a good idea to look at other insurance products--we will touch on that in more detail soon. First, there are two crucial questions to ask yourself if you do not have disability or life insurance:
April 2013 Archives
A living will is connected to a healthcare power of attorney or healthcare proxy (read our blog entry from last week here) in that it stipulates your wishes regarding healthcare, specifically that which is designed to prolong your life. This document contributes to your estate planning process. Decisions that fall into this category include (but are not limited to) use of a ventilator in case your body can no longer sustain breathing, or use of a feeding tube, to name a couple of examples.
When it comes to your living will, you will want to cover those standard provisions, but there are two additional elements which may come into play.
If you suffer from a chronic illness, you will want to make sure that your living will includes specific information about your desires regarding treatment of that illness and medical prognosis. It’s not a bad idea to educate your healthcare proxy about your illness so that if anything arises that you have not specified in your living will, he or she will be prepared to make a decision that will honor your wishes.
Does your family have any religious beliefs that may conflict with your own? If so, highlight your beliefs in your living will and make sure to communicate these to your family. The best way to do so is to approach the matter from a position of respect of their beliefs, while taking a stance that your wishes are outlined in a legal document as part of your estate plan. If you think your family will have moral difficulty seeing that your wishes, as outlined in your living will, are met, you may consider assigning a healthcare proxy who is not a familial relation.
Estate planning isn't only for when you, someday, pass on, but rather for that or any situation which incapacitates you so that someone else needs to make decisions in your stead. For this reason, the power of attorney exists. When beginning to think about who you will select to act under your power of attorney, it's important to remember there are two principal areas in which to act, and that you might wish to have a different power of attorney for each.
When it comes to estate planning, one of the best things you can do to ensure a smooth transition of control of your estate is to keep your beneficiary information up to date on all pertinent documents. Doing so will prevent confusion and delay in processing your estate. You can either choose to conduct a regular review to make certain that your beneficiary information is, indeed, correct, or you can simply change it any time you make changes to your beneficiaries.
The executor or executrix of your estate will have the task of seeing to it that your last wishes and your will are realized. When beginning the estate planning process, many think that an heir has to be an executor of the estate, however, you may elect anyone you wish to fill this role. In some cases (such as heirs being children), it may be preferable to select another family member, close friend or trusted advisor to fulfill the duties of your executor.