A Guide to Planning Your Estate: Wills, Trusts, and the Power of Attorney

Table of Contents

  • Introduction to Estate Planning
  • Asset Ownership
  • Beneficiary Designations
  • Living Trust and Living Wills
  • Power of Attorney
  • Last Will and Testament
  • Information for Executor and Statement of Desires
  • Conclusion and Next Steps

Introduction to Estate Planning

Planning Your Estate

The main reason for planning your estate is the need to have a plan in place to protect yourself and your family in case something happens to you, whether in death or disability.

Many people realize that if something were to happen to them, they will leave a real mess behind for their family to sort out. For example, your family may not have the authority needed to handle your affairs at the dental practice if you become incapacitated or to manage the distribution of your estate if you pass away. 

Even if you already have an estate plan in place, it may be outdated, improperly implemented, or have certain weaknesses that need to be addressed right away. By following our guide to planning your estate with a suitable attorney, you can rest assure that your plan will be put into motion in the event of your disability or death and probate can be avoided.

Some items to consider:

  • What would happen to your assets after death?
  • How to eliminate or reduce estate taxes
  • The financial well-being of your loved ones
  • Medical treatment planning
  • Guardianship over any children that are minors

One of the first things you should do is take an inventory of your assets and possessions.

Asset Ownership

Take Inventory of Your Property

Between your tangible assets and your intangible assets, do a thorough inventory of your assets.

The tangible assets may include:

  • Residential and commercial real estate such as a dental office
  • Cars, motorcycles or boats
  • Collectibles and other possessions

If any of these tangible assets have titles documents such as a car or a house, you can set up the title to automatically be transferred to a co-owner such as a spouse upon your death. Although the title document must clearly demonstrate the ownership is held as joint tenants with the rights of survivorship, as tenants or community property.

The intangible assets may include:

  • Checking accounts, saving accounts, health saving accounts, and certificates of deposit
  • Stocks, bonds and mutual funds
  • Retirement plans such as a 401K and IRA's
  • Life insurance policy
  • Ownership in business such as a dental practice

Upon taking your inventory, it is important to get an estimation of value for each tangible and intangible item. You can even have an expert do a property or dental office appraisal. Putting an estimated value of each item will give you an idea of what they're worth so they can be distributed equitably to your loved ones.

Beneficiary Designations

Account for Your Loved Ones

When considering beneficiary designations, you have to consider exactly what asset(s) you will like to give to whom upon your death. Beneficiaries can be your spouse, your children, your relatives, and charities. A couple of aspects to note is that designations cannot be applied to all types of assets and depending on what state you live in, you can designate beneficiaries to certain assets with title documents.

Beneficiaries can generally be added to the following assets:

  • Bank accounts
  • Security accounts
  • Retirement accounts
  • Life insurance policies
  • Saving bonds

Additionally, there are two other designations to be aware of. Pay-on-death (POD) and Transfer-on-death (TOD) are designations that grant beneficiaries property upon your death without giving them current ownership rights.

Now that you have taken inventory of your assets and designated your beneficiaries, the next step in your estate plan is to put together your living trust and will.

Living Trust and Living Wills

Living Trust

A living trust is a legal document that was created during an individual's lifetime that designates a trustee who has the responsibility of managing that individual's assets and property for the assistance of the eventual beneficiary. For this purpose, a living trust is set up to help bypass the legal, complicated, and expensive process of probate by allowing for an easy transfer of the trust's creator assets.

The biggest thing to remember about implementing a trust is that you must transfer your assets into the trust for it to work for you. This can be a hassle, but not doing so can be costly in terms of the time and expense of having those assets probated.

Therefore, you need to make sure that your real estate is deeded to the trust and that your trust is the beneficiary of your retirement and other accounts. You can also create a pour-over Will to make sure that you are covered if you fail to transfer some assets into your trust before you pass away. Either way, it is absolutely necessary to fund your trust with your assets if it is to be fully effective.

Living Will

A living will is also commonly known as a medical care directive, is designed to direct your wishes for medical care in the case that you cannot do so for yourself. These decisions may include whether or not you want a feeding tube, to be kept alive on a ventilator, or to have your organs donated. These are very personal choices and you need to think them through thoroughly.

You can also direct a trusted person to be your medical power of attorney in your place. These two documents can be combined into one which is known as an advanced healthcare directive. 

A living will can serve other purposes as well. For example, it can include a springing trust to ensure that a person who inherits from you has restrictions on what they receive. This can be very useful for minor children because it will provide a trustee to manage funds on their behalf. A springing trust is also a good way to manage funds on behalf of a spendthrift adult who may burn through their inheritance quickly in the absence of restrictions.

What's more, your living will can designate a guardian or conservator to care for your minor children and manage their money after you pass away. With your living will, you can also dispose of intangible property, make plans for your funeral and burial, and designate a personal representative to handle the administration and distribution of your estate after your death.

After discussing the benefits of a living trust and living will, we will dive deeper into the power of attorney.

Power of Attorney

General Power of Attorney

A general power of attorney grants a person or organization broad powers to act on your behalf if you are physically or mentally unable to manage your affairs.

A general power of attorney can handle the following things:

  • Business transactions such as selling a medical or dental practice and its property
  • Purchasing life insurance
  • Settling claims
  • Making gifts
  • Operating business interests such as operating a dental practice and handling its finances
  • Employing professional help

Special Power of Attorney

What makes a special power of attorney different from a general power of attorney is that you can designate specific people for specific aspects of your estate. In other words, you can designate your spouse to handle your healthcare decisions if you're unable to do so for health-related reasons, while also designating a business partner to handle your business decisions. 

Healthcare Power of Attorney

A healthcare power of attorney allows someone to make healthcare-related decisions on your behalf if you're unable to make those decisions yourself. Identifying this person should be someone you can trust in the event you will need live-saving measures. This person should understand how you would like your wishes to be played out, such as determining how your religious and personal decisions can have a factor regarding certain treatments.  

Durable Power of Attorney

A durable power of attorney is a bit different from a general power of attorney in that there is language within the document which states a designated person or agent's authority continues to apply even if you become incapacitated. Whereas, a general power of attorney ends once you become incapacitated. Additionally, there is no set deadline for a durable power of attorney's rights to expire until the principle passes away or until they act to remove the power they have granted their agent or designated person.

Other aspects in which a durable power of attorney has control of:

  • Signing checks
  • Making deposits
  • Paying your bills
  • Contract for medical or other professional services on your behalf
  • Selling your property such as homes and dental practices
  • Purchasing insurance for you

Upon explaining the differences between the varied aspects of power of attorney, we will move on to last will and testament.

Last Will and Testament

Last Will and Testament

A last will and testament layout the way your assets will be distributed and utilized upon your death. A last will is different from a living will in that a living will states your wishes in the event you are in a vegetative state or incapacitated and unfortunately, can't communicate your wishes regarding your medical needs such as life-support. 

Upon one's passing, an executor will be responsible for collecting all of the estate's assets and property, looking after accounting records, and paying taxes, and any outstanding debts of the estate. Lastly, the executor will start distributing the decedent's assets to the beneficiaries assigned in their Will. Another thing to note is that a person's last will can be changed or revoked at any time prior to the person's death.

Now, we move on to information for executor and statement of desires.

Information for Executor and Statement of Desires

Information for Executor and Statement of Desires

Even though this information is not a legally binding document, this information is very important as it gives information and guidance to the executor of the estate. 

The document should help identify and locate all of the following:

  • Personal items and records such as your personal I.D., license, tax ID number, social security number
  • Financial accounts
  • Credit cards
  • Insurance policies
  • Personal loans and loans for vehicles, boats, etc.
  • Mortgages and leases for residential properties and commercial properties such as dental practices
  • Safe deposit boxes, storage units, P.O. boxes, etc.

Other items include contact information for:

  • Relatives and close friends to be notified of your passing
  • Advisors such as your attorney, financial advisor, accountant, and primary care physician
  • Instructions for your final wishes such as burial, cremation, funeral ceremonies, organ donation, scattering of ashes, etc.

Conclusion and Next Steps


When planning your estate, it is important to perform a thorough review of your estate planning documents to ensure that they are up-to-date and that they reflect your most current wishes.

A properly implemented and comprehensive estate plan will allow you to, among other things, ensure that:

  • As many of your assets as possible avoid probate
  • Plan for incapacity
  • Provide for special needs loved ones and minor children
  • State your wishes for emergency medical treatment and end-of-life care

Most importantly, having a comprehensive estate plan in place will give you and your family a great deal of peace of mind knowing that you have planned well for the unexpected. Furthermore, having your wishes expressed in writing will save your family the stress of having to make difficult decisions on your behalf during a time that is already very stressful.

While, in many cases, you may be encouraged to prepare certain legal documents on your own to save money, you should never go it alone with your estate planning documents. Estate planning is too sophisticated for cutting corners. Furthermore, there is too much at stake to trust any pre-written estate planning document or do-it-yourself kit. So, please, consult with a knowledgeable and experienced estate planning attorney.

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