What other elements are involved in my estate plan?

Powers of Attorney are crucial documents to execute when finalizing your estate plan. If you are unable to make decisions without a Durable Financial Power of Attorney, a court will have to appoint a guardian to handle your affairs, pay your bills, and manage your property and investments. Guardianship proceedings can be lengthy and costly, and there is no guarantee that the court will appoint your preferred guardian. You can easily prevent this situation by planning ahead and appointing an Agent to act on your behalf. By having a well-drafted Durable Financial Power of Attorney, your Agent will be authorized to make financial decisions regarding your property. Similarly, a well-drafted Healthcare Power of Attorney will enable your designated Agent to make medical decisions during your incapacity.

Even if you have established a revocable trust, Powers of Attorney are still important components of your estate planning. The main reason for setting up trusts is to avoid probate. However, only assets that have been properly transferred into trust ownership can bypass probate administration. Therefore, if you become incapacitated and your family discovers that you neglected to transfer a bank account that you solely own into the trust, that account would be subject to probate upon your death. If you had executed a Power of Attorney with specific authority to transfer assets to your trust, your Agent could have transferred the account into the trust prior to your passing. This would have saved your heirs the time and cost of probate administration.