Putting one’s affairs in order – it’s something only the 55 plus generation should be concerned with, right? Wrong. While it is true that many recent graduates have little in the way of assets to protect, seeming only to have a mountain of debt, one is never too young to begin the preparation of a general estate plan. It is particularly important if you have a young family or have plans of starting one in coming years. Experts say all Washington State young professionals should have at least these four legal documents in place as they contemplate their future.
Durable Financial Power of Attorney
Once thought to be a legal document only for the gray-haired crew, a durable power of attorney, often referred to as “a POA,” is a document in which one names an agent to act on his or her behalf concerning personal financial affairs. Ordinarily, the agent only acts in the event the principal is unable to handle his or her own affairs. For example, if the principal was seriously injured in a car crash or suffered a debilitating illness, the agent – often a family member or close friend – steps in to pay bills, invest and reinvest assets, and to otherwise act as the principal would, if he or she could do so.
As is often said, a POA is “something you don’t need … until you do.” A POA generally cannot be put in place if the principal is unable to make his or her own decisions.
Health Care Power of Attorney
In some respects, a Health Care Power of Attorney is similar to the POA just discussed and, in fact, the two can be combined. The Health Care POA governs decisions related to a principal’s health care. As with the Durable POA, the principal names an agent who is given the authority to make healthcare decisions on behalf of the principal, if the latter is not able to make them. While hospital administrative representatives often hand out forms for Health Care POAs as if they were candy, it is actually important to have these documents drafted by an experienced attorney.
Last Will and Testament
While an elaborate estate plan may only be a distant dream for the young professional, virtually everyone should have a will. It need not be complicated. It does need to be properly drafted and executed, however. A will essentially determines to whom your assets – meager as they may now seem to be – to those around you. Without a will, the state of Washington writes one for you and it may not be what you would prefer. Having an appropriately drafted will in place is absolutely vital if you have minor children.
Appropriate Beneficiary Designations in Retirement Documents and Insurance Policies
Some property is unaffected by a Last Will and Testament. That is to say that there are some forms of property, or interests in property, that pass to others at death based on special beneficiary designations. Two common types are retirement accounts and insurance policies. If your employer has a 401(K) program, if you have an IRA, or if you have life insurance of any kind in place, you must make an appropriate decision as to beneficiary, and you must appropriately indicate that choice on the appropriate form. If one fails to make an appropriate designation, the retirement funds or insurance proceeds pass through the deceased’s estate and since the IRS has technical rules about estates serving as beneficiaries, there may be a delay in distribution of retirement funds if you have left the forms blank. Your family won’t lose the money; distribution of it could, however, be significantly delayed.
Blado Kiger Bolan, P.S. – Experienced, Caring Attorneys to Handle Your Legal Concerns
Do you have these important legal documents in place? Do you risk expense and confusion by failing to designate appropriate legal agents, beneficiaries, and others? Blado Kiger Bolan, P.S. has more than 30 years of combined experience providing both individuals and businesses with quality legal services throughout the Pacific Northwest. We have helped clients with both simple and complex issues related to wills and estate planning, and would be pleased to share our experience with you. We pride ourselves on designing the simplest, most effective solution for your legal issue. For assistance with a will, a trust, or any sort of estate planning issue, contact us on the web, or call our office at 253-272-2997.