Everyone who owns property or has minor children should have the following documents, which are the components of a basic estate plan.
1. Last Will
A will names the executor of your estate, identifies your preferred guardian if you have minor children, and provides instructions regarding the distribution of your assets to your chosen beneficiaries. If you do not name a guardian for your young children, a probate court will appoint someone who may not be the person you would have chosen yourself to serve in that role. Likewise, without a will, your assets will be distributed in accordance with an Ohio law known as the Statute of Descent and Distribution. The statute may not distribute your assets in accordance with your wishes.
2. Durable Power of Attorney for Finances
Otherwise known as a General Durable Power of Attorney, this document gives a person you select the authority to pay your bills and manage your financial affairs. You can choose for the power of attorney to go into effect immediately, or you can choose for it to go into effect only in the event that you become incapacitated and are unable to manage your finances. Powers of attorney are not just for the elderly. People can become seriously ill or injured at any stage of life. Having powers of attorney for finances and health care in place will save your family many headaches and will ensure that there are no delays in the management of your finances and healthcare, should you become incapacitated.
3. Durable Power of Attorney for Health Care
This document gives the person you select the authority to make health care decisions regarding your care. You can choose for the power of attorney to go into effect immediately, or you can specify that it will go into effect only upon your incapacity.
You may also wish to add a living will to your estate planning package. A living will gives your physician the authority to withhold all life-sustaining treatment and permit you to die naturally, taking no action to postpone your death. It is important to understand that for the living will to go into effect, you must be unable to communicate your wishes to your physician, and two physicians must agree that you are either in an unconscious state with no reasonable possibility of regaining consciousness, or that you are terminally ill and near death with no possibility of recovery. The living will instructs your physician to provide the care necessary to make you comfortable and relieve your pain.
In Ohio the terms of a living will "trump" a health care power of attorney, meaning that your physician can allow you to die in accordance with the living will even if the person holding your health care power of attorney does not agree with that decision. To avoid this result, have your lawyer add language to the healthcare power of attorney indicating that your attorney-in-fact has the last word regarding end-of-life decisions. So why have a living will at all if you are giving your attorney-in-fact the final word? Because by having a living will you make end-of-life decisions much easier for your attorney-in-fact, given that he or she will know your wishes. The living will also reduces the likelihood that there will be conflict between your attorney-in-fact and your other family members.
Finally, you should consult with your lawyer to discuss whether a trust would be a beneficial addition to your estate plan. There are many different types of trusts that meet a wide range of estate planning needs. The most common reasons for establishing an living trust are discussed in "Who Needs a Trust"
