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Life Planning

Why should your estate plan begin with life planning? Because without it, your plans for the future and your family’s future could be greatly impacted in ways you may have never foreseen. Many have begun to see the need for life planning to be included in their estate plan. Longer life spans, complex family dynamics, and growing assets have spurned more and more people to design plans that include provision for living scenarios. A growing number of people have seen the need for a plan that provides for how their estate should be handled not only at their death, but in life as well.

Although estate planning is truly life planning, many still view estate planning in a different light. “Death,” “Will,” “Probate,” and “Executor,” are the terms that come to mind for most when they think of estate planning. Traditionally, estate planning has focused on your assets and the distribution of them at your death.  Many, even those who understand the importance of estate planning, see estate planning as essentially “death planning.” This may explain why more than half of the country chooses not to plan at all. Think about it, most people do not want to consider their own death, and finding an excuse to postpone the planning for what happens if you die is often an easy thing to do. The truth is though, while a proper estate plan addresses how your assets are distributed at death, it should also address the issues and circumstances of your life. In fact, life planning should be the cornerstone of any estate plan. An estate plan should reflect your current assets, life circumstances, trusted helpers, your wishes, and your concerns.

A proper estate plan should have three stages: The First Stage: While you are alive and well; The Second Stage: When/If you become incapacitated; The Third Stage: At your death. Notice that the first two stages of a proper plan are while you are living. What does life planning actually do? Life planning provides protection for you, your family, and your assets while you are alive. 
   

What do you need protecting from you might ask? First and foremost is incapacity, Incapacity can deal a mighty blow to your finances, stability, retirement accounts and most importantly you and your family’s well being.  The confusion that is brought on by a lack of instructions, guidance, delegated power, and the unknown can make a difficult time even worse. Because we are a society that is becoming more and more disabled for longer periods of time, the need for life planning is even more pressing.  Incapacity and disability are an ever present reality for many families. All too often strong financial plans that did not include the protection of a proper estate plan have ended up as inadequate plans. When a plan does not allow for the possibility of a incapacity, funds designated for one area of life can be quickly exhausted to compensate for the lack of planning. That is why it is of the upmost importance to you, your family, and the protection of your assets that you have a legally binding document that empowers helpers that you trust to carry on your day to day business, make decisions that are in your best interests, and follow the instructions you have prepared and the parameters you set in place. 

Tax planning, protection of assets from lawsuits, and protection from creditors are just a few of the benefits of an estate plan that includes life planning. Even what may seem like an unlikely scenario or concern should be addressed in a proper estate plan. What types of concerns? Many small business owners are concerned about how certain circumstances may effect the day to day operations of their business as well as its longevity.  Parents are concerned about the accessibility to funds for the care of each other and the children in the event of an emergency. These concerns can be addressed with the protection of estate planning.

A proper plan should first begin with You. At a minimum you should have a current Health Care Power of Attorney to permit your spouse, children and/or family to make emergency health care decisions for you in the event that you are unable to do so. Incapacity can strike at any age, and having the correct documents in place is a an excellent way to prepare for this unfortunate possibility.

One of the most important life planning aspects of any estate plan is who you appoint as helpers. Your helpers should be people you trust to have your best interests at heart. These are the people who will step into your shoes if something should happen to you and you are unable to handle your affairs. Helpers are those who have the power and instructions to carry on with the things you are unable to do such as: access your accounts to provide for you family, pay your bills, tithe to your church, and even feed your pets. If your list is not current, then by all means update your estate plan. Make sure you have helpers listed who are willing and able to help.  An estate can be depleted if the proper people are not appointed.  Provisions for removing and replacing helpers should be a part of a proper estate plan as well.

So what you should do if you do not have an estate plan or do you do not have one that includes a plan for incapacity? Contacting an estate planning attorney is the starting point for putting a proper plan in place. An attorney should draft a plan that fits your situation, your concerns, and your goals. Proper planning should always address the issue of incapacity. Remember, your planning should encompass much more than how your things are distributed at your death. A proper estate plan should begin with planning for life’s circumstances as well.



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