While physicians in Washington are busy professionals, they should make time to complete estate planning. Creating a comprehensive estate plan can help doctors to prevent unintended consequences and protect themselves and their loved ones if anything unexpected occurs. A good estate plan should include several documents to provide the greatest protection.
Consequences of dying without a will
People who die without wills have their assets passed to their heirs under the state’s intestate succession laws. These laws determine how the estates are divided and who will inherit the assets. When assets are distributed under the state’s intestacy laws, the decedent’s wishes will not be followed. Instead, the assets will go to the family members in shares, and charities and friends will not receive anything. The process might also be expensive for the survivors if family members contest how the assets are distributed. Depending on the estate size, passing the assets under the intestacy laws might also incur estate taxes.
Important estate planning documents
Physicians generally make good money and have relatively large estates. That’s why they should update their wills every five to seven years or when major life events occur. A comprehensive estate plan may include many documents, including the following:
• Living will
• Advance directive
• Durable financial power of attorney
• Durable health care power of attorney
• Revocable living trust
Living wills, advance directives and durable powers of attorney allow you to plan for incapacitation and being unable to make decisions for yourself. A living will allows you to control the types of end-of-life medical care that you’ll receive. Advance directives refer to a combination of a living will and a health care proxy through which a person is named to make health care decisions for you. Durable powers of attorney allow you to designate trusted people to make decisions on your behalf regarding property, finances and medical care.
Wills allow a testator to decide how their assets will be distributed after their deaths. Living trusts can be used to hold assets during the grantor’s life and become irrevocable once you pass away. Trusts allow assets to pass to the beneficiaries outside of the probate process.
When it comes to estate planning, there are obviously many options. An attorney can guide you through the process and help you draw up a suitable plan.