When many of our readers think about estate planning, wills are most likely the first documents to come to mind. A will is the bedrock document of any solid estate plan. If a person has a will, they are off to a good start when it comes to protecting assets for future generations and beneficiaries. But is a will all that is needed?
According to a recent article, as well as numerous previous posts here, drafting a will is just the beginning of a comprehensive estate plan. As the recent article pointed out, a will may be the principle framework of an estate plan, but other documents are almost certainly needed by most people.
For starters, powers of attorney provide immense protection for certain, uncontrolled situations. If, for instance, a person is in an accident which results in a temporary - or permanent - incapacity to make decisions regarding medical care or financial obligations, powers of attorney can appoint a trusted confidant to administer to such concerns. Separate powers of attorney are needed for both obligations in Michigan, and the appointed person does not have to be the same for each.
Besides a will and powers of attorney, setting up a trust - or multiple trusts - is something that many people dismiss because they do not believe they have the kind of assets to benefit from them. This is not always the case, however. Trusts can be set up for numerous types of personal property or monetary assets, and can be extremely helpful when trying to determine how to designate property distribution.
Having a will is a great start, and is usually much better than dying "intestate" - without a will. However, most people should consider the many benefits of drafting other pertinent estate documents. Having all bases covered in a comprehensive estate plan can be an essential step to avoiding litigation.
Source: PatriotLedger.com, "MAKING CENTS: Estate plans do more than avoid tax hit," John P. Napolitano, Jan. 26, 2013