Estate planning is confusing. There is a tendency among people to conflate last wills and estate plans. A last will is a document outlining how an individual wants the courts or their executor to distribute their assets after their death. An estate plan is a more comprehensive set of documents that includes not only a last will but other official paperwork as well.
The best estate plans combine your wishes regarding your legacy with your preferences in the event that you suffer medical incapacitation. In many cases, creating a thorough estate plan also involves planning for tax liability and care as you age. All of these issues relate to one another and can influence each other.
You should plan for death or medical issues
A last will is certainly a critical part of your estate plan. However, death is not the only circumstance in which your loved ones may need to make decisions on your behalf. In the event that you suffered some kind of disabling injury or begin exhibiting symptoms of dementia, a thorough estate plan will have protections in place for you and guidance for your loved ones.
You should include an advance medical directive that outlines what medical care you want to receive. Consider everything from whether you wish to donate any organs or tissues to how you feel about resuscitation or life support. In addition to making your wishes known, you want to empower someone to make them on your behalf when you can't do so.
A power of attorney for medical decisions can authorize someone in your family to make medical choices. A limited financial power of attorney can ensure that your financial obligations receive adequate attention during your incapacitation.
Long-term care and taxes should also factor into your planning
If your family has a medical history that includes debilitating or degenerative diseases as you age, it is important to plan accordingly. Even if there is no history of disease in your family, developing a plan that connects you with long-term care if you need it is a wise choice. Medicare will not cover the costs of nursing home care or in-home nursing.
There may come a time when you need to qualify for Medicaid to receive care. Creating and funding a trust now can help ensure you get the care you need as you age. As an added bonus, the creation of a trust can help protect your family against tax liabilities at the time of estate administration.
There are many different ways to approach this process, and every person's unique situation will influence what they include in the documents and what decisions are best for them. Discussing your needs and preferences with an experienced estate and probate attorney in Connecticut is a good first step toward the creation of a comprehensive estate plan that protects you and your wishes.