Estate planning is about much more than just distributing tangible or financial assets after someone passes away. It also focuses on planning for the future, with the understanding that a medical emergency could occur.
Three documents may be helpful when doing this type of advance planning. Many estate plans will contain all three, as they address different areas.
A financial power of attorney
First, you may want to set up a financial power of attorney or a legal power of attorney. This can give someone else the ability to act on your behalf if you are incapacitated. They may be able to pay taxes, access bank accounts, pay hospital bills or navigate real estate transactions.
A health care proxy
With a health care proxy, you choose an individual who can make medical decisions for you. If you are incapacitated and the doctors want to give you emergency treatment, for example, then your proxy can authorize that treatment when you are unable to do so. This could be the same person as your financial power of attorney, or someone else entirely.
A living will
Finally, you can use a living will to make some decisions in advance, rather than choosing an agent to act on your behalf. If you do not want to be resuscitated or kept on life support, for example, you can spell out your medical wishes in a living will.
Setting up your estate plan
These are three important documents to consider when making your estate plan. Take the time to carefully weigh all of the legal options at your disposal.