Rock legend and superstar Prince was a worldwide celebrity, and his untimely death is truly tragic. Yet for all his wealth and fame, it appears he may not have had an estate plan in place, dictating how he wanted his millions passed on after he died. And he is not alone. Many individuals in Kansas City, young and old, do not have an estate plan. Prince’s death, however tragic, highlights the need to create an estate plan, no matter what your wealth.
It is never too late to create an estate plan. Let’s examine some documents individuals may want to include in their estate plan.
When a person thinks of an estate plan, the first thing that may come to mind is a will. A will is basically a legal statement of who you want to take care of your estate after you die and how you want your assets passed down. If a person has minor children, a will can name who will take care of the children should both parents die.
Instead of a will, many people choose a trust as their primary estate planning tool. Trusts are typically more complex than wills, but they have a number of advantages, including avoidance of probate.
Some financial assets have beneficiaries named in the account documents. This includes certain types of retirement accounts and life insurance policies. Such beneficiary designations operate independently of what an individual may include in their will.
Finally, an estate plan should include a health care directive and a durable power of attorney. A health care directive can outline your wishes about what you want done medically if you can no longer communicate your wishes. A durable power of attorney appoints a trusted person to manage your affairs should you become incapacitated.
Creating an estate plan is not just for your own benefit, it is for the benefit of your loved ones, who will not be left second-guessing what you would have wanted. If you have more questions about how to create an estate plan, there are legal professionals available to assist you.
Source: money.usnews.com, “A Purple Rain Estate Plan,” Brian Preston and Bo Hanson, May 6, 2016