A will lets you take control of how your property is distributed after your death. If you have a simple estate, a simple (or basic) will may be sufficient. But the more complex your estate and life are, the more complex the will may need to be. This is where you get to choose your executor, a guardian for your children, and a manager for property you leave to minor children.
A basic will is adequate for you if you:
- are under 50
- are in good health
- don’t have more than $1.5 million in assets so won’t owe estate taxes.
A more elaborate will and other measures are needed if you:
- own more than $1.5 million in assets (as most B&B innkeepers do)
- want to control the what happens to your estate after you die
- have a special needs child you want to continue taking care of
- have children from a previous marriage who may be in conflict with your spouse
- may be considered mentally incompetent to have written your will
Living wills spell out what you do and don’t want in regards to medical care if you can’t communicate your wishes; it only deals with health care options. This document is in addition to your will. This is a vital document if you have strong feelings about your health care and aren’t sure they will be honored. It takes pressure off your family at a time they don’t need to feel pressure or can’t easily make decisions. A living will may not be fool-proof in getting you what you want, but it is a legal documents, which gives you some support.
The strength of a living will is increased when the same person assigned as your proxy or agent (person in charge of speaking for you) is also given your durable power of attorney (POA), also known as an enduring POA. A regular POA is often revoked by a court decree when you become incapacitated, unless it’s a durable POA. The continuity of the same person being in charge for you is helpful to everyone. The durable POA is revoked by the death of the principal or by the principal himself.
On the other hand, if you want different people to handle different aspects of your estate while you are incapacitated, consider having different kinds of POAs. A medical, or health care, POA would give one person power to handle your health care concerns. It goes into effect when the POA is executed and delivered and has an indefinite term unless otherwise stated.
A limited POA (aka use or special POA) lets you define what authority your agent has during your absence or incapacity. This type of POA can create an agent for your real estate transactions, or one specific transaction, handle an automobile transaction, or any financial and property transaction or business you may have.
The bottom line is that you need to make plans now for your estate. That includes not only a will that lays out the distribution of your assets, but also the people who will handle things before your death in the event you can’t handle them. The combination of will and POAs gives you confidence in how everything will happen when you get sick or die.
Take control or it will be determined for you by the government.