Who Needs an Estate Plan?

True or False? Only rich, elderly people need to have an estate plan.

It wouldn’t be a surprise if you chose ’True.’ After all, just the word ‘estate’ brings to mind large country manors with huge tracts of land. And that’s how the Oxford Dictionary defines it.

However, there’s another definition that refers to an estate as all the money and property owned by an individual. Therefore, if you have any assets, you should have an estate plan. 

But when should you create yours? That’s what we’re going to explore.

What’s in an Estate Plan

Everyone has different needs, and some estates may be more complex than others, especially if investments, real estate, retirement accounts, and luxury items exist. But some components should be included in every estate plan:

Last Will and Testament

68% of U.S. adults don’t have a will. They may assume that everything goes to their spouse or their children, but that’s not always the case. Instead, everything you own will be distributed according to California’s intestacy laws.

If you have a spouse and children, your spouse will get all the marital assets and half of any separate assets you may have. Your children will get the other half of the separate property. If you and your spouse don’t have children, then half of the separate property will go to your parents.

If you don’t have a spouse, everything goes to your children. The estate will go to your closest relatives if there is no surviving spouse or children. This has become such a common occurrence that it even has its own term: the laughing heir. Furthermore, without a will, certain sentimental items won’t get passed on to the people you wished to receive them. 

Even more important than material belongings, you can name a guardian for any minor children you may have in your will. Without that designation, the courts will decide your children’s care, and they may be raised by someone who doesn’t share your values.

Power of Attorney (POA)

If you were hospitalized due to an illness or injury and couldn’t communicate, who would take care of your financial affairs? How would your bills get paid? What if there were important investment decisions that needed to be made?

A power of attorney is a legal document that gives a trusted individual the authority to make financial decisions if you become incapacitated.

Healthcare Proxy and Advanced Directives

Just like a power of attorney handles your financial affairs during your incapacitation, a healthcare proxy handles the medical decisions. In addition, advanced directives outline what you want regarding end-of-life care.

Digital Estate Plan

We spend much of our time online. It’s crucial that you provide instructions on how to access your accounts, which should include:

URL
Username
Password
If it requires multi-authentication

You will also want to outline what you want done with your social media accounts, any domain names that you own, and pictures and documents stored in the cloud.

Estate Planning Help from LPEP Law

If you’re an adult, you need an estate plan, and the time to start is now. You may have been putting it off because it feels overwhelming. That’s where our lawyers at Lonich Patton Ehrlich Policastri can help. We have decades of combined experience and work with people throughout San Jose and the Greater Bay Area in creating tailor-made estate plans.

That’s because we understand everyone’s situation is unique. We will discuss your goals in making an estate plan, ensuring it is customized to your specific needs.

Contact us today to schedule your free consultation by calling (408) 553-0801.

Disclaimer: this article does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter.