The media is hyper focused on the tax cuts that will expire at midnight when the ball drops in Times Square. This includes the expiration of the largest estate tax exemption we have ever seen: $5,120,000. But who really cares? Most of us simply won’t have any estate tax imposed on our estates so IGNORE the noise and focus on what matters to YOU! It’s time to create an estate plan that reflects your wishes because the tax considerations should always be secondary to your plan anyway.
What is an estate plan?
Think of it as the most important map of your life! It reflects the way you want your personal and financial affairs to be handled in case of your incapacity or death. It allows you to control what happens to your property if you die or become incapacitated.
If you’re married, the odds are that you’re going to outlive your husband. That’s significant for a couple of reasons. First, it means that if your husband dies before you, you’ll likely inherit his estate. More importantly, though, it means that to a large extent, you’ll probably have the last word about the final disposition of all of the assets you’ve accumulated during your marriage.
If you’re single, even with limited assets, you still need an estate plan since it’s not just about the money. It’s about naming someone to make important health decisions in the event of your incapacity and, if you have children, who will care for your children during your incapacity or at your death.
Do we all want a say in this? Why leave these critical choices to others, or even your state? That’s exactly what will happen if you don’t get going and create an estate plan!
Here are the basic documents you need:
- Will/Revocable Trust – a document that states your wishes about the distributions of your assets and names the guardian for your minor children
- Living will – a document that lists the types of medical treatment you would want, or not want, under particular circumstances.
- Durable power of attorney for health care (health-care proxy) – lets one or more family members or other trusted individuals make medical decisions for you.
- Durable power of attorney– lets one or more family members or other trusted individuals handle financial matters for you, even in the event of incapacity
Of course once you have these documents you need to place them in a very safe place. We also encourage you to retain an electronic copy in DivaDocs so they can be accessible from anywhere in the world. For just $4.99 you can not only access your vital document but also be able to forward them easily to others at a moment’s notice. (to learn more go to www.DivaDocsapp.com or the app store on your Iphoneor Ipad). After all, DivaDocs is the first personal filing cabinet that fits in your purse! tm
Helpful Tip from Name Bubbles: To organize physical copies of your important documents, try new Write On! Labels. In the event of changing circumstances, you can simply wipe away the message and replace it with new information.