Written by Attorney Cynthia P. Letsch of Letsch Law Firm, P.C.
It’s a new year and time to take care of those pesky New Year’s resolutions before they get buried under the pile of life’s everyday chores and burdens.
Step 1: Review your powers of attorney or get them if you do not already have them. Do you know where they are? You should have two documents. One is a General Durable Power of Attorney. The other is a Health Care Power of Attorney, which may include a Living Will, also known as an Advance Medical Directive. If you do not have both powers of attorney and are at least 18 years old, make an appointment to get them. If they are more than two years old, consider updating them.
Step 2: Review your estate planning documents. These are your Last Will and Testament and/or your Revocable Living Trust. If you own real estate, and your beneficiaries are adults, the planning document you most likely need is a revocable living trust. Its main purpose is to avoid probate: yes, you want to avoid probate. If you have minor children, married or not, a trust will also work well for you, but you may be able to accomplish your goals… yes, you have goals; you just might not realize it without getting some advice on what you should be thinking about… a Last Will and Testament that includes a contingent beneficiary trust for your children is likely the appropriate planning tool.
Step 3: Review your insurance policies (residential, auto, and life). What are your deductibles maximum coverage? Is it enough or too much? Do you have extra coverage for rental while you are displaced from your home or vehicle? How far will it pay to be towed? What if the party responsible for damage has no insurance? Do you have flood insurance or need extra coverage for hard-to-replace or valuable items, such as jewelry or your extensive Christmas decoration collection? Do your life insurance beneficiaries need to be changed? Note: do not name minors as beneficiaries or name a third party, like a family member, as a beneficiary with the idea that they will use the money for the kids. They may have every good intention of doing this, but there are significant risks with this type of planning. (see #2, above). See an estate planning attorney for better alternatives.
