Estate planning is the process by which an individual or family arranges to transfer money and property in anticipation of death.  An estate plan has two purposes: to preserve the maximum amount of wealth possible for heirs and to maintain freedom and flexibility for individuals and families prior to death.  Estate planning will include having a will, but may also involve trusts, powers of attorney, and medical directives.  If your estate plan is done properly you may be able to avoid the chaos and wasted assets of an unplanned estate, help ensure that your property will be distributed the way you want, and provide a sense of security for your loved ones.  

Wills and trusts are common ways individuals dispose of their wealth.  Trusts, unlike wills, have the benefit of avoiding probate.  Probate is a legal process that puts a court and judge in charge of the transfer of your property.  Without a will to indicate your wishes, the court steps in and distributes your property according to the laws of your state.  Many times, property is lost to descendants/heirs because the owner has died and failed to leave a will.  A will ensures that what assets you do have will be given to the family members or other beneficiaries you designate.  If you have no apparent heirs or die without a will, it is possible for the state to claim your estate.

The following documents are common in a basic estate plan:

• Living Trust.  A living trust names beneficiaries, successor trustees, and determines what happens to you or your property upon your death or disability.
• Will.  A will is usually a written document that disposes of your property that takes effect at your death.
• Living Will.  A living will is a document that instructs health care providers whether or not to give life-sustaining treatment beyond comfort and care, if that treatment would serve only to artificially delay the moment of your death.
• Statutory Durable Power of Attorney (POA).  A POA grants one or more people the power to manage your financial affairs if you become unable to do so or if you want a person to handle these things for you.  The holder(s) of your POA has/have the legal power to make binding decisions that affect your money, property, and other assets, including, paying your bills and spending your money.  A POA terminates on your death.
• Medical Power of Attorney.  This document names a person or persons to hold the power to make healthcare decisions (including mental health care decisions) for you if you are unable to make those decisions for yourself.