WHAT’S AN ESTATE PLAN?
The phrase “Estate Plan” can sound overwhelming, ominous even. What is an Estate Plan? Isn’t that just for rich people? The truth is that everyone – including you – needs an Estate Plan. It’s not as complicated as you might think.
An Estate Plan should include the following documents:
- Will or Revocable Living Trust
- Financial Power of Attorney
- Medical Power of Attorney with HIPAA Release
- Living Will (for end-of-life decisions)
- Declaration of Guardian for Yourself
- Declaration of Guardian for Minor Children
WILL OR REVOCABLE TRUST:
A will or revocable living trust tells your appointed executor or trustee how to distribute your assets after you die. By drawing up a will or trust, you control how your assets are passed on. If you don’t take action to draw up your own will or revocable living trust, your state legislature has taken care of this for you. The problem is that your state may have different ideas than you do about who to give your assets to – and the state doesn’t even consider your desire to give any of your assets to a charitable organization like the ELCA or its related ministries. Whether you have a little or a lot, don’t you want a say in how your assets are passed to loved ones and charities?
BEST ADVICE: Make your own decisions and have a will or revocable living trust drafted by an estate planning attorney. Review this document every 5 years or sooner if your life circumstances change.
FINANCIAL POWER OF ATTORNEY:
This document appoints the person who will handle your financial affairs when you are not able. Without a financial power of attorney, your loved ones will be forced to seek a guardianship for you. Guardianships are both time consuming and expensive. While there is no guarantee that a financial power of attorney will ultimately prevent a guardianship, it will address many issues without the need for a guardianship.
BEST ADVICE: Sign a financial power of attorney appointing an agent and at least one successor agent. Update this document every 5 years.
MEDICAL POWER OF ATTORNEY WITH HIPAA RELEASE:
This document appoints the person who will make medical decisions for you when you cannot make such decisions for yourself. The HIPAA release provides this person the ability to access your medical information when making those decisions. In some states, these may be two separate documents.
BEST ADVICE: Choose an agent who knows you well and with whom you are willing to discuss the kind of medical care you expect and sign a medical power of attorney and HIPPA release. Update this document every 5 years.
A living will (also known as a Directive to Physicians) lets your loved ones and healthcare providers know if you prefer life sustaining treatment or palliative care if you are in a terminal or irreversible condition.
BEST ADVICE: Sign this document and share your wishes about end-of-life decisions with your loved ones. Update this document every 5 years.
DECLARATION OF GUARDIAN FOR YOURSELF:
Should your financial power of attorney be out of date or should you physically be a danger to yourself or others, there may be a need to declare a guardian of your estate and/or a guardian of your person. In this document, you get to name your preference of who will serve as guardian. This declaration may be included in your medical power of attorney.
BEST ADVICE: Consider who will best serve you from both a financial and personal point of view. Update this document every 5 years.
DECLARATION OF GUARDIAN FOR MINOR CHILDREN:
Thinking about who should care for your children if you can’t is a scary thought for every parent; however, not deciding who should fill this role is probably worse. Without your input on this issue, the court will have to rely on those who come forward wishing to fill this role. This declaration is often included in your will or revocable trust.
BEST ADVICE: Make the best decision you can, and don’t be afraid to consider non-relatives. Since you should update this document every 5 years, you can revisit your decision often during your child’s formative years.
SO WHAT’S NEXT?
Seek out your ELCA Foundation regional gift planner to help you get started on your Estate Plan. Know that estate planning is not a “one and done” project. Like anything of value, you need to take care of it by reviewing it every 5 years to see if your will or revocable trust needs updating and to sign new power of attorney documents.
NOTE: This document is for information only and should not be considered legal advice.
- Your Regional Gift Planner is Rev. Ana L. Lugo • Ana.Lugo@elca.org • (904) 219-2769 (Cell Phone) •