When you create an estate plan, you might receive suggestions about the directives that best serve your needs. Note that you do not need to create all available directives. You can make your decisions based on your unique family situation and personal preferences.
The more blended or complex your family structure, the more likely that you might need more directives. When creating directives, keep in mind that they pass power onto someone else, so choose wisely.
Nerdwallet explains that when you put assets in a trust, you can name yourself as a trustee. You can also name another trustee who manages the assets should you become incapacitated or pass away. Some kinds of rusts may also protect your finances from creditors, lawsuits and other potential threats, but not a Trust where you are the Trustee.
Durable power of attorney
When a person receives this power, they may have full control to manage your finances as they see fit. Consider this carefully when choosing someone. They need both the will and the skill for the role.
Limited power of attorney
If you prefer to limit what people can do or to assign different roles to different people, this document makes it possible. You can get as specific as you want with this document. For example, you can specify the transaction the person has authority over and what they can do, such as sell one named stock or sign a document.
This allows someone else to make medical decisions on your behalf. It can also create static directives that doctors and the appointed health proxy must follow, such as a DNR order. An actual DNR must also be signed by your doctor. A Living Will will convey your wishes with regard to heroic life saving measures in the event you are terminally ill. You may also specify whether you intend to donate organs.
The more wealth you acquire, the more important estate planning becomes. However, anyone can benefit from estate planning, especially with high levels of debt.