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What are the different components of an estate plan?

On Behalf of | Jun 6, 2022 | Estate Administration

Many people feel overwhelmed at first when they think of writing their estate plan. It’s easier than you may think. Five of the main documents to include in a New Jersey estate plan relate to your financial power of attorney, healthcare power of attorney and any other important financial information.

Durable Power of Attorney

In New Jersey, a Durable Power of Attorney is someone who has the legal permission to manage your finances and investments when you are unable to because of incapacitation. You should choose someone who is responsible with money for this role.

Advance Directive

An Advance Directive is your Durable Power of Attorney for healthcare. They can make healthcare decisions for you when you aren’t able to because of incapacitation.

Last Will and Testament

The Last Will and Testament outlines what will happen to each portion of your estate after your death. You should formally name each beneficiary, even if they are your spouse or child. It’s important to account for all of your assets and property when you’re estate planning to prevent probate delays and arguments after your death. Your Last Will and Testament isn’t set in stone until your death. You can revise it and revoke it whenever you want to, as long as you follow the state’s procedures. New Jersey allows testators to create self-proving wills, which means a judge won’t need to review it to confirm it’s real. This saves time on probate and prevents others from questioning its legitimacy.

Living trust

A living trust isn’t a must-have, but it’s a strategy to consider when you’re estate planning. Trusts don’t have to go through probate. Assets that you pass on through a trust also stay private. Contents of a will, in contrast, are in the public record.

List of assets and debts

Including a list of your assets and debts is helpful in ensuring you covered everything. It also makes it easy for those who read your will to understand the extent of your estate.

Your estate plan should include the five documents above to effectively communicate your wishes. You must consider what you want to happen if you become unable to make your own decisions as well as what you would want after your death.