Skip To Content

Estate Planning Essentials: Do You Have These Documents in Place?

By Gina DiMonda, CTFA, CFP®
President, ESL Trust Services, LLC

Throughout my career, I have been fortunate to meet with many individuals and families. I always value these conversations as they allow me to truly learn about people’s goals when it comes to their financial futures.

Unfortunately, there has been a concerning trend in many of these meetings when it comes to estate planning: People are missing—or are unaware of—the essential legal documents, specifically a valid health care proxy, living will, power of attorney, and last will and testament.

While these documents may be unfamiliar or the idea of discussing these topics is uncomfortable, the fact of the matter is you never realize how vital these documents are until you need them the most. The absence of well-written, properly executed estate planning documents can put your loved ones in an unnecessarily stressful position that could have easily been avoided.

Health Care Proxy & Living Will

A health care proxy appoints an individual (agent) to communicate and decide health care decisions when you cannot, and a living will is a written document that expresses your personal wishes concerning medical care and directs your agent to carry out those wishes if you are incapacitated.

A properly drafted and executed health care proxy and living will can ensure that your wishes are clear and can be put into practice if you’re unable to execute your wishes yourself. They may also alleviate any possible confusion among family members, eliminating the guesswork surrounding what they think you would want or don’t want.

You will still, of course, make health care decisions for yourself as long as you’re able to communicate them to your health care providers. You should meet with your attorney and have a health care proxy and living will prepared that includes the following:

  • Your name and address
  • Name and address of your health care proxy/agent (i.e. the person you want to execute your wishes if you are unable)
  • Name and address of an alternate health care proxy/agent
  • Special health care-related instructions
  • Signatures of two adult witnesses (must be 18 years or older) stating they have witnessed the agreement and both parties appear to be sane (agent and individual do not count as witnesses)

Durable Power of Attorney

Similar to a health care proxy and living will, a durable power of attorney is a written authorization for an agent to represent you or act on your behalf in private affairs, business, or other legal matters.

There is a common misconception that a spouse can automatically take over their significant other’s accounts if the other spouse becomes incapacitated. That is only true if the couple are co- or joint account holders. If the account is in a person’s name alone, a duly executed durable power of attorney may grant authority to the agent to access and use those funds for your benefit or according to your expressed wishes.

Lack of a power of attorney may result in an unfavorable outcome that goes against your wishes and/or additional unnecessary expenses, and possibly the need to have a legal guardian appointed.

Last Will and Testament (“Will”)

A will or testament dictates how property in your name alone (with no named beneficiary or joint owner) should be distributed upon your death.

Life events such as marriage, divorce, and birth/adoption of children may change how you want your assets to pass. I highly recommend to meet with your attorney to review your will at least every five years to ensure what is written continues to meet your plan. Even if circumstances don’t change, sometimes laws do, and you want to ensure your will is documented in accordance with your wishes.

At the very minimum, you will want to consider having the following in your will:

  • Nominate a primary and an alternate executor to administer and distribute the assets in your estate
  • Nominate guardians who will care for any minor children and any property they could inherit (physical and financial)
  • Determine how debts and taxes will be paid

Planning, Communication, and Education are Critical

While there are several other estate planning tools designed to meet specific needs, the four outlined here are considered the essentials.

It is never too early to plan and to meet with your attorney to execute these documents. It is equally important to have the necessary conversations with your spouse, children, and other family members relaying your wishes and informing those individuals who would be responsible to carry them out.

How ESL Trust Services Can Help

While ESL Trust Services cannot draft these documents, we are connected to and work with a number of highly skilled estate planning attorneys throughout the greater Rochester community to whom we would be happy to refer you. We are honored to help you and your family achieve your estate planning goals. Please feel free to contact ESL Trust Services at 585.336.1300 to set up a meeting or to discuss any questions.