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The Estate Planning Checklist You Must Have

By April 9, 2017 No Comments

Estate planning is a reality we all have to face head-on at some point. Of course, many of us continue to put this off; but in doing so, the consequences can be extreme…

I have rarely seen a shopping cart so full. Stuffed with red, white and blue party supplies and comfort food, this family was clearly going all out for 4th of July.

As I stood there waiting in the checkout line, I began to think about all the planning that was going on in homes around the country – the time, the energy, the money being expended for a party. And Independence Day is just ONE of the holidays that Americans love to celebrate. It seems as though the stores only take down one season’s theme to put up the next. Everything might be orange and black in preparation for Halloween, and for some folks the plans for this holiday are very extravagant; they decorate their front yards, rent costumes, and organize parties. But next week, it will all come down and the attention will immediately shift to Thanksgiving. This will involve even MORE planning, as family members get ready to criss-cross the country by planes, trains and automobiles to be with each other.

Then comes the mother of all holidays: Christmas. It’s no exaggeration to say that some people plan for it all year long. I have a friend who likes to tease his wife that she has O.C.D … “Obsessive Christmas Disorder”. We haven’t even mentioned New Year, Valentine’s Day, Easter, Mother’s Day, Father’s Day, Memorial Day and Labor Day. Some of my Hispanic friends will spend years setting aside funds to be ready for their daughter’s Quinceanera.

Now, there are people who revel in all this planning for special days, while others just tolerate it as an unavoidable chore. Hardly anyone escapes it completely, however. Just think of the millions of people running around with calendar notes and to-do lists to get ready for the next holiday celebration.

So, would it surprise you to know that 55% of adult Americans don’t have a will prepared? That’s right – more than half the population.

“You don’t get to choose how you’re going to die, or when. You can only decide how you’re going to live. Now.” – Joan Baez

For the record, I am not against any of our annual celebrations, or the preparations that go into them. They add a lot to our family lives. But to put them in perspective, these are events that mostly come around every year and are planned for again and again. It’s certainly not as much fun to think about your death, but it’s a once-in-a-lifetime unpredictable event that we all need to be ready for.

4 Key Estate Planning Documents

Estate Planning is the process of managing and preserving your assets while you’re alive, and conserving and controlling their distribution after your death.

There are 4 key estate planning documents that most adults should have, regardless of age, health or wealth. They ensure that (a) your personal wishes are known and carried out, (b) your loved ones are not burdened with unnecessary complications at a very difficult time in their lives, and (c) your assets are not eroded by legal processes.

1. A Durable Power of Attorney

This document allows you to authorize a person of your choice to act on your behalf and handle your financial matters in the event that you become physically or mentally unable to do so. The person you empower can do things like:
– Pay bills and expenses
– Watch over your investments
– File taxes on your behalf

2. Advanced Medical Directives

These directives let others know what medical treatment you would want, or not want, in the event that you can no longer express your wishes for yourself. If you don’t have one of these documents in place, medical care providers are obligated to prolong your life using artificial means, even if you would not wish to have such procedures.
In the state of Texas, you must fill out two separate forms to have a complete Advance Directive: A Living Will called a “Directive to Physicians and Family or Surrogates” and a “Medical Power of Attorney” (a.k.a. Health Care Proxy).

3. A Will

The main purpose of a will is to distribute property to your heirs after your death, according to your wishes. In your will you can name an executor to manage and settle your estate, and a legal guardian to care for your minor children. A will is a formal legal document that is filed with the court, and eventually becomes part of the public record in a process known as “probate”.

4. A Letter of Instruction

This is an informal, non-legal document that generally accompanies your will and expresses your directions about what is in your will. It may also include other things that are important to you, such as personal thoughts you want to express, burial wishes, or the location of important documents.
A letter of instruction can be the most helpful document you leave for your family members. Unlike your will, a letter of instruction remains private.

Together with your financial planner, you should have these documents prepared, and then review them every few years to ensure that they are up to date.

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Humphrey G. Thomas is registered with and offers securities through Kovack Securities, Inc., member FINRA, SIPC. 6451 N. Federal Highway, Ste 1201, Fort Lauderdale, FL 33308 (954) 782-4771 Advisory services offered through Kovack Advisors, Inc. HG THOMAS WEALTH MANAGEMENT, LLC and Empower Your Wealth unaffiliated with Kovack Securities, Inc. and Kovack Advisors, Inc. Humphrey G. Thomas is registered in GA,MN and TX. Check the background of this financial professional on FINRA's BrokerCheck