If you are newly married, estate planning may be the last thing on your mind. However, there are steps you should have in place to protect each other and ensure that your wishes are carried out.
The first thing to update is the beneficiaries on your accounts, including retirement, bank and health savings. If you don’t have life insurance, now is the time to get a policy in place. You will be tempted, but don’t think the rest of your estate planning can wait until later. An estimated one half of Americans don’t have an estate plan. Even if you don’t have the budget right now to complete all of the following documents, decide which is most important and get started.
Last Will and Testament
Everyone should have a will. A will allows you to determine how your property will be distributed upon your death. Without a will, state law determines that distribution, and it may not be what you want. You can also name a guardian for your minor children and make charitable contributions.
In some situations, you might need a trust in addition to a will. A trust is a way to manage your assets and property during your lifetime and provide for distribution when you die. Many people think a trust is something only for wealthy people, but that is not necessarily true. Assets held in a trust are not subject to probate, so it is an option that deserves consideration. An attorney can help you determine whether you should set up a trust. For more information on estate planning, visit finitylaw.com.
Retitle Property Into a Trust
If you establish a trust, you need to decide what assets will be part of the trust. Real estate deeds need to be retitled to the trust. You may be able to include homestead property in the trust. Consult with an attorney to make sure this is set up properly.
Durable Power of Attorney
A power of attorney allows your designee, called an agent, to make financial decisions in your stead. If it is a durable power of attorney, your agent is permitted to make these decisions if you become incapacitated. Spouses generally name each other as agents, but if either of you is not comfortable with this, you can name a third party whom you trust to make financial decisions on behalf of your family.
You want to have a living will in place to ensure that end-of-life medical treatment is carried out according to your wishes. A living will should lay out what you want to happen if you are unable to make decisions for yourself. You can specify things like whether or how long you wish to be on life support. You can also direct if you want any of your organs to be donated upon your death. A living will makes your intentions clear and spares your loved from making those difficult decisions.
Health Care Surrogate
In addition to or instead of a living will, you may designate a health care surrogate. Your health care surrogate makes decisions about your medical treatment if you are not able to do so. It differs from a living will because it is not just for end-of-life decisions. You need to have an attorney help you decide whether you should have a living will or health care surrogate or both. You don’t want to become the center of a legal dispute if your living will and health care surrogate are at odds.
Thinking about what happens after you die may not seem like the best way to start your life together. However, making sure that each of you is protected and knows the wishes of the other is the best gift you can give each other should the unthinkable happen.