Planning for the future is a wise step in preserving your assets and ensuring your wishes for the future come to be. However, many people neglect to create estate plans because they think it takes considerable time and money to do so.
Your estate plan does not need to be extensive or complex to prove effective. However, a fundamental New York estate plan should encompass several key components that help safeguard your legacy and provide for your loved ones.
Last will and testament
While a will is arguably the most important part of any estate plan, Gallup reports that only about 46% of American adults currently have one. A last will and testament dictates where your assets go after your death. You must name an executor who will be responsible for managing your estate once you die.
Certain assets, such as life insurance policies and retirement accounts, allow you to designate beneficiaries. Ensuring these designations are up-to-date and align with your wishes is an important step in the estate planning process.
Health care proxy
If you cannot make medical decisions for yourself, a healthcare proxy designates someone to make these decisions for you. This person should be trustworthy and familiar with your medical preferences.
Power of attorney
A power of attorney grants someone the authority to manage your financial and legal matters should you become unable to do so yourself. It is important to choose someone who is responsible and understands your financial situation to take on this role.
A living will outlines your preferences for medical treatments in case you are unable to communicate your wishes. This document can alleviate the burden on your loved ones by clarifying your health care desires.
While these are some of the most important elements to include in your estate plan, this is not an exhaustive list of all estate planning documents and options that may be available to you.