If you’re part of the Millionaire Doctor group on Linkedin you have accumulated substantial wealth or are well on your way to doing so. A comprehensive financial plan needs to include estate planning to protect and transfer such wealth. It is critical you protect yourself and your family in an event where you become incapacitated and or pass away.
“…..but in this world nothing can be said to be certain, except death and taxes.” Benjamin Franklin
According to the National Association of Estate Planners & Councils: “Estate planning encompasses the growth, conservation, and transfer of an individual’s wealth through the creation and maintenance of an “estate plan.” The purpose of estate planning is to develop a strategy that will maintain the financial security of individuals through their lifetime and ensure the intended transfer of their property and assets at death, while taking into consideration the unique circumstances of the family and the potential costs of different methods.”
Although everybody’s situation is different, there are a couple of documents you should consider to assist you in the estate planning process.
- Durable Power of Attorney is a legal document that authorizes someone, known as an agent, to act on your behalf. This legal document can be broad based or limited, it’s up to you. You can authorize the agent to act on your behalf for financial matters like opening or closing a bank account, buying or selling real-estate, or signing legal documents, among other things.
Understand that a Power of Attorney “POA” and Durable Power of Attorney “DPOA” are different in that a POA terminates if you become incapacitated. Whereas a DPOA remains effective, hence the word durable.
- Advanced Medical Directives allow you to specify which medical treatments you want and who can make such decisions for you in an end of life situation. Two documents to consider are a Living Will and a Health Care Proxy. Essentially through a “Living Will” you specify how to proceed in regards to medical treatment. Whereas a Health Care Proxy is a document where you authorize someone to decide which medical treatment is best if you cannot decide for yourself.
- Will. It states how to distribute your property/assets at death. Without this document the distribution of your property/assets will be made according to state intestacy laws.
Make sure you review your current financial situation to uncover any opportunities to protect and ensure all your estate planning needs are being taken care off. Remember that these documents should be reviewed frequently. Especially if you move to another state, your authorized agent passes away or any other situation that might cause your documents to require updating. Make sure you consult with a qualified estate planning attorney.
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