Estate planning can be important at any age. However, it can be more of a concern as you age. If you’re moving to senior living, it might be time to consider your options. You can protect assets and ensure your wishes with a sound estate plan. It can also make probate easier for your loved ones at the time of your passing.
Key Elements of Estate Planning for Seniors
Last Will
A will is often the foundation of an estate plan. It’s simple to create and can be updated anytime. Be sure to include your assets, debts, and beneficiaries. Before choosing an executor, talk to them about the role. Also, consider the various assets you want different people to inherit.
Trusts
A trust lets you transfer your property to a trustee, who manages it until your beneficiaries can claim it. Trusts can offer tax benefits, set limits on asset distribution, and avoid probate.
The following are some of the types of trusts you may set up during estate planning:
- Revocable Living Trusts: These trusts allow you to remain in control as the trustee and have the flexibility to adjust assets and distribution. You can also appoint a successor trustee to take over when needed.
- Irrevocable Living Trust: An irrevocable trust holds assets to move them from your name. These trusts can reduce the taxable estate at the time of your death. Some seniors may also use them to assist with Medicaid eligibility. However, irrevocable trusts are very difficult to change.
- Special Needs Trust: Some seniors may have heirs with disabilities. These trusts ensure that these heirs can receive their inheritance without losing government benefits.
- Spendthrift Trusts: Some people might worry that heirs have issues managing money. This type of trust can protect against misuse and ensure the funds last. The grantor can set conditions or control disbursements.
Healthcare Power of Attorney
A healthcare power of attorney is a legal document and an important responsibility. With this document, you name someone to act as your healthcare proxy. The proxy makes medical decisions on your behalf if you can’t communicate. This person may face crucial life-and-death choices for you.
Living Will
A living will is a legal document that outlines the medical treatments you do or don’t want to keep you alive. It can also include preferences for things like pain management and organ donation.
Beneficiaries
An estate plan should name beneficiaries—those who will inherit your estate. It is also important to remember beneficiaries on bank accounts and insurance policies. Seniors should also review and update beneficiaries regularly.
Care That Goes Beyond
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