When it comes to estate planning, it is important to include provisions for what is to occur with a person's affairs both while they are still alive as well as after their death. A proper set of documents that direct the wishes of a person during incapacitation as well as after death are vital to ensuring that the person's wishes are carried out exactly as they want and not left to the uncertainty of allowing the courts to settle the matter.
A very effective way to ensure a seamless transition in a person's affairs after their incapacitation or death is to have a durable power of attorney and a will in place. Assigning a durable power of attorney requires completing a POA form.
A power of attorney and a will are separate documents that provide different protections to a person's estate. A durable power of attorney is used to direct a person's affairs while they are still alive. The POA can become effective immediately if the person needs help dealing with their day-to-day affairs, or it can be set to become effective only after a person is incapacitated and cannot make decisions for themselves. While a power of attorney allows a person to appoint an agent to administer to their needs while they are still alive, the durable power of attorney ceases upon the death of the individual. This is when a will is needed.
A power of attorney can be used to nominate a power of attorney to represent an individual and their affairs in several different areas should they become incapacitated.
A last will and testament is a legal document that controls what happens to a person's property and assets after their death. Wills allow a person to grant their assets or property to certain beneficiaries and determine what and how much of the estate they each will receive. Once a will is in place, the executor of the will, who is appointed by the individual, is in charge of dividing up the assets of the estate according to the wishes of the principal.
If a person dies without a will, it is left up to the courts to administer the individual's assets according to state laws. This process is based upon pre-established formulas that give general guidance to the courts on how to divide a person's estate. Often times, an executor is appointed by the court and has no knowledge of the wishes of the individual and they must act according to arbitrary rules set forth by the court. This can lead to an estate being divided up in a manner that is not consistent with the wishes of the deceased or the family.
Proper estate planning ensures that a person's life work can be shared with their loved ones in a manner that they see fit. The vital tools required to complete proper estate planning are the formulation of a durable power of attorney for the critical time when an individual can no longer act for their own best interest and a last will to ensure their estate is handed down according to their wishes after death. Without these tools in place, a person's needs and final wishes could be left to chance.