What’s Your Estate Plan?

What’s Your Estate Plan?

My wife and I have a close friend who recently underwent a major heart operation. Like me, he’s in his early 30s and appeared to be in perfect health. Our friend visited a doctor earlier in the year regarding a sleep issue when they discovered a complication in one of his heart valves. He had been living with this condition his entire life and did not have the slightest idea. Thanks to the skill of his doctor, identifying this condition likely saved his life.

All of us have experienced a significant health issue at some point in our lives – either personally or with a family member or close friend. Sometimes they work out the way we hope, but other times they do not. Regardless of the outcome, these events force us to take a step back and think about what matters most in life. They also require us to consider how we want things to be when our time comes. As financial planners, it is our responsibility to help engage in these conversations in order to prepare for when these circumstances come about.

Below is a list of important estate documents you should have. They will help make your desires clear and minimize confusion and conflicts for your loved ones.

1)      Last Will and Testament – A will is considered to be the foundation for any estate plan. It directs how your property will be disbursed when you die. A will has two significant components. First, it allows you to appoint an individual to speak on behalf of your estate and oversee the distribution of your assets. Second, if you have minor children, you are able to appoint a guardian who will oversee their well-being. Failure to draft a will prior to your death puts these important decisions in the hands of the courts. A judge appoints your estate administrator and/or guardian, which may or may not be in line with your wishes.

2)      Durable Power of Attorney (DPOA) – This document helps protect your assets in the event you become physically or mentally incapacitated. A DPOA is equally important when you face a major medical procedure, like my friend. It allows you to appoint an individual to serve as your agent and make important financial decisions. Paying bills and other expenses can be easily overlooked when facing a serious medical condition. It is important having someone to handle these matters on your behalf and not putting these decisions in the hands of the courts.

3)      Medical Power of Attorney – Similar to a DPOA, a Medical Power of Attorney appoints a trusted individual to make important medical decisions on your behalf.

4)      Advanced Medical Directive – This is also known as a “living will.” An Advanced Medical Directive outlines specific medical treatments you do and do not wish to receive. It provides doctors and hospitals with instructions about resuscitation, pain management, organ donation, and other critical procedures. It is important to discuss these wishes with your physicians and the agent you appoint in your Medical Power of Attorney to ensure everyone is on the same page.

These four documents solidify the basic cornerstones of your estate planning needs. In addition, you should keep your beneficiary information updated on your qualified retirement accounts, such as 401ks, 403bs, IRAs, etc. For those requiring advanced estate planning, trusts and charitable giving may provide the flexibility needed to properly manage how your assets will pass in a tax-efficient manner.

While we are not permitted to give legal advice, we do work with knowledgeable and experienced attorneys who specialize in estate planning. If you have any questions or would like more information on addressing your estate needs, please feel free to call our office at (713) 623-6600 or email info@finsyn.com.

Will Goodson

Will Goodson

Will focuses most of his time on the Financial Synergies Pathway program, but he also supports the advisory team by creating 401(k) allocations, designing financial plans, and determining the best strategies for clients when taking Social Security. Will is a University of Texas graduate and CERTIFIED FINANCIAL PLANNER™ professional.

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