What Are the Six Essential Documents for a Good Estate Plan?

Every estate plan should include six critical documents; only one missing piece can render your loved ones powerless to act in an emergency. However, if you have these six documents up-to-date, you will be prepared for whatever the future may bring.

1. A Trust

A trust is the cornerstone of the most thorough estate plans, serving as a virtual container to hold property. The type of trust you use will depend on the goal you want to accomplish. If you want to avoid having your property tied up in probate after you pass, your estate planning attorney will set up a revocable living trust. You can transfer property into a trust that will pass directly to alternate beneficiaries without going through the delays and expense of probate. An irrevocable trust may be necessary to conserve property while establishing Medicaid eligibility or reducing estate taxes.

As the creator of the trust, you are known as the grantor. Trustees manage the trust and control how property investments and disbursements occur.

2. A Will

A common misconception is that the creation of a trust means that no will is necessary. In fact, it is wise to set up a “pour-over will” to cover assets that are not transferred into the trust. A will can name a guardian for minor children, a topic that trusts do not cover.

3. Durable Power of Attorney with Affidavit of Agent and Notices

Do you know what would happen if you were unconscious due to an accident or illness? Would your bills go unpaid?

Having a financial power of attorney in place can prevent this type of problem. A durable power of attorney (DPOA) is the type of power of attorney most often used in estate planning. DPOA should be evaluated every ten years and give legal and financial authority to a designated party, allowing a family member or friend to pay bills or transfer funds to cover debts.

With a power of attorney, you grant someone you trust the ability to make decisions on your behalf if you become unable to make or communicate decisions on your own.

4. Designation of Health Care Surrogate

If you were incapacitated, would doctors be unable to provide treatment because they lacked authority? A medical power of attorney, referred to in Florida as a Health Care Surrogate, authorizes a loved one to make decisions about treatment on your behalf.

5. Living Will Declaration

Of the six essential estate planning components, three involve healthcare. Alongside the Health Care Surrogate, you should have your estate planning attorney prepare a Living Will Declaration. The Living Will Declaration is a type of advance directive where you specify the type of care you wish to receive if you are suffering from a terminal condition and unable to communicate your preferences.

6. HIPAA Authorization

The final document that should be part of your estate plan is a HIPAA Authorization statement. The federal law called HIPAA (Health Insurance Portability and Accountability Act) mandates health providers to take specific actions to defend the privacy and safety of an individual.

This document allows someone you trust to confer with doctors about your care and handle health insurance and Medicare.

A Florida Estate Planning Attorney Can Draft or Revise Your Six Essential Documents

Estate planning documents should undergo regular reviewing to ensure that they comply with current legal requirements and still fulfill your wishes. The team at Amy Phillips, Attorney at Law, will be happy to draft or review your critical estate planning documents so that you will be ready for whatever lies ahead. Contact us today to learn how we can help protect your future.