Preparing an estate plan requires more than a will. A comprehensive estate plan may include a will, a letter of last instruction, a durable power of attorney, a health care power of attorney, a living will, an advance instruction for mental health treatment, and/or a trust.
Your attorney can help you decide which documents you need to achieve your estate planning goals.
A will is a legally enforceable declaration of how your property will be distributed at your death, similar to a roadmap providing details of who gets your belongings. A person who makes a will is a testator. When a person dies leaving a will, he or she is said to have died testate. A person who dies without a will dies intestate.
This document conveys basic information to survivors upon your death. Rather than forcing survivors to become detectives and find all of your important papers, you can provide the details and instructions in one document.
A letter of last instruction provides organization and a checklist for your survivors at a difficult time. Keep your important documents in one place and leave a letter of instruction with your personal representative and family. Always attach a copy of the instructions to your will. At a minimum, include the following information in the letter:
- Name(s) and address(es) of your adviser(s).
- Name(s) and contact information for your:
- insurance agent
- financial planner
- bank officer
- Location of your records, which may include:
- insurance policies
- retirement plan beneficiary designations
- retirement plan survivor annuity election
- safety deposit box
- savings deposit books
- income tax records
- trust agreement
- marriage certificate
- divorce decree
- adoption documents
- military service record, Form DD-214
- Name(s) and address(es) of relatives
- Social Security number
- Burial instructions
A durable power of attorney is a document that gives someone else the legal right to act on your behalf. The person you nominate is your attorney-in-fact or your agent. You are the principal.
A health care power of attorney is a durable power of attorney that gives another individual the right to make medical decisions for you when you cannot, due to either physical or mental disability. The person nominated is your health care agent. You are the principal.
This document specifies how to handle certain decisions about your mental health treatment. This document can stand alone or can be used in conjunction with a health care power of attorney. This instructional care document is most appropriate for mental health patients with diagnoses such as autism, schizophrenia, paranoia, and bipolar disorders.
A living will is a statement that you prefer to die a natural death as you define it; you do not want your life prolonged by artificial means if there is no reasonable hope of recovery. In North Carolina, the technical name for a living will is Declaration of a Desire for a Natural Death.
A trust is a legal arrangement whereby a grantor transfers the legal title of property to a trustee to hold and manage that property for named beneficiaries. Trusts can be complicated legal instruments. They may also be expensive to manage.
The assistance of Sreedevi Gummuluri, PhD, and Aimee Schmidt, MA candidate, is gratefully acknowledged.
This publication is provided as a public service to acquaint you with certain legal issues and concerns. It is not a substitute for legal or other professional advice, nor does it tell you everything you may need to know about this subject. Future changes in the law cannot be predicted, so statements in this publication are based solely upon the laws of North Carolina and the federal government in force as of the date of this publication.
Previous versions of this publication were prepared by Carol A. Schwab, Adjunct Professor, NC State University, Nathan M. Garren, former Extension Economist, NC State University, and Barrie Balzli Stokes, former Family Resource Management Specialist, NC State University.
Publication date: Jan. 1, 2010
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