In this issue of the Financial News I want to discuss the importance of ensuring that your adult children have the proper legal documents.  Estate Planning is not only for the over 50.

Many individuals believe that estate planning is only for those individuals approaching or entering retirement, but having the proper legal documents in place is vital for all individuals over the age of 18.  I will review with you the three primary estate-planning documents that all adults should have, whether they are single, married, with or without children.  Please encourage your children to take the time to address this critical part of their financial plan.  Even consider making a financial gift to them to help cover the cost of the visit to the attorney.

Will.

The Will is designed to state clearly what we would like to have done with the assets that we own when we die.  Having a simple Will in place can ensure that our wishes are carried out and our assets are disbursed to the beneficiaries of our choice.  Within the Will we also name a Personal Representative to handle the administrative responsibilities of settling our estate.  For individuals with minor children, the Will can also name legal guardians for the children and establish trusts to protect and manage any assets transferred to these minors.  Without a Will the individual dies intestate and the State determines the distribution of the individual’s assets, which may not be the wishes of the deceased.

Durable Financial Power of Attorney.

This document will designate an Agent, sometimes called an Attorney-in-Fact, who is responsible for managing an individual’s financial affairs should they face an illness or incapacity.  This document can help prevent a Guardianship process where the Courts have to get involved because an individual did not have the proper documents in place.  A guardianship can be a very stressful event for a family.

Medical Advance Directive.

This document handles an individual’s medical wishes should they be unable to make those decisions on their own.  The document assigns a Medical Agent that the Doctor can have discussions with as well as grant the legal authority for this Agent to make decisions on the individual’s behalf.  The document also states clearly the individual’s wishes in regards to end of life situations, such as continuing medical treatment when the individual is in a terminal illness or vegetative state.  As you have seen on the news many times, this issue can tear a family apart and be dragged into the court and political process.  Having your wishes clearly and legally documented is vital.

Having these three core legal documents drafted by a qualified estate planning attorney will ensure that your children’s wishes are carried out and their financial and medical affairs protected.  Not having these documents can cause a terrible trauma for a family.  Please talk to your adult children and stress to them the importance of having their estate planning documents in place.  As always if you have questions you can reach me at 301 785-4112 or at pfish@sandyspringbank.com.