The estate planning conversation is one of the toughest you can have with your loved ones – and it’s also one of the hardest topics to think about on your own behalf.

It can be daunting to carve out the time it takes to consider your assets and plan for your family’s financial prospects, let alone to grapple with thoughts about your own health and wellbeing. But, with that being said, it’s important to educate yourself on what goes into the estate planning and administration process – before it’s too late to set yourself and your family up with a more secure future.

There’s no time like the present to get started! Here are some thoughts on three common estate planning questions, which may have crossed your mind at one point or another…

1.) "Am I Really Old Enough to Need a Will?"

You may figure that you’re still young and healthy, and that drawing up a last will and testament is an old person’s game.

In a lot of ways, creating your will seems like a task that you can put off until some unspecified time in the future. And, in fact, more than half of all American adults do not have a valid will in place – perhaps for this very reason.

But the reality is that it’s never actually too early to consider your will. If you’re an adult with family to care for or any assets to consider – including real estate, valuable personal possessions, financial accounts, and securities or investments – then you’re likely in a position where you’ll want to have a will ready, should something unexpected happen.

Remember, a valid will is, in many ways, the cornerstone of a comprehensive estate plan. This is the mechanism many people use to:

• distribute their assets to friends and family members
• name the person who will be responsible for overseeing probate for the estate
• provide for the guardianship of their children (and pets)

Without a will, you will largely be ceding away all of your ability to control what happens to your possessions when you pass, turning things over to state intestacy laws – and potentially opening up your friends and family to a longer and more complicated probate process.

2.) "What Happens to Me If I’m Incapacitated?"

Just as many of us prefer not to think about the sad reality of dying, most people are reluctant to consider what will happen to themselves and their loved ones if they ever become incapacitated due to a critical illness or unexpected accident.

While it may be a difficult subject to think about, it’s an important one to plan for.

Incapacitation can strike at any moment, and it’s vital that you leave guidance for your friends and family to follow, should the unthinkable happen to you.

Preparing for incapacity or infirmity can take several forms. For instance, in most cases individuals tend to benefit from creating an advanced healthcare directive, often referred to as a living will or declaration. This is a mechanism by which you can dictate how you’ll receive medical care, in the event that you cannot make such decisions for yourself at some point in the future.

You may also wish to consider naming a power of attorney for healthcare and finances; this designation allows a friend or family member you trust to have the legal authority to make decisions for you and take care of your wishes on your behalf, should you be unable to make or communicate your own decisions. In most cases, individuals can exert a significant level of control over who they name as power of attorney, as well as what scope of authority this named “agent” will have.

Despite the general importance of planning for end-of-life care, only 41% of Americans had living wills as recently as 2007. At the same time, just about one-third of adults (38%) had a healthcare power of attorney. Starting on these important processes now could save your family significant grief down the line – and help ensure that your wishes are known and respected, at every step of the way. 

3.) "What Actually Goes Into Estate Planning?"

We’ve mentioned estate plans already in this article, and it’s likely a term you’ve heard before in some capacity. But what does it actually mean, in practice?

In general, estate planning refers to the broad array of steps you may take to help set up your loved ones and beneficiaries for a smooth transition when you pass away. Broadly speaking, a comprehensive approach to estate planning often includes:

• Accounting for your assets
• Leaving guidance for how to pay off debts/deal with creditors to the estate
• Leaving guidance for how to distribute your assets, often in the form of a last will
• Preparing for incapacitation and long-term care
• Taking steps to simplify probate, such as setting up a revocable living trust or naming beneficiaries for relevant assets

In short, estate planning is a broad and multi-faceted process – and one that should be approached with an open mind.

No matter what stage of your journey you’re on, it’s never too early to consider the many elements that go into estate planning and administration. If you live in the Chicago area and have any more questions or concerns about wills, trusts, probate, power of attorney, or any other piece of the estate planning puzzle, our team may be able to help. Don’t hesitate to drop us a line today to keep the conversation going!

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