Estate Planning with Purpose

Estate Planning with Purpose

Mar 07, 2017

A lot of people think an estate plan is only for the wealthy. But even if you're not worth millions, an estate plan is essential to help protect your heirs and ensure that your assets are distributed according to your wishes. You may also want to consider how you would like to express your “values” to your loved ones with an ethical will.

An estate plan doesn't have to be complex, but it definitely should include three basic documents: the will, power of attorney, and an advanced health care directive.

  1. A last will and testament (will) states how you want your assets to be distributed and also names a guardian for any minor children.
  2. A durable power of attorney for finances, also known as a financial power of attorney, gives someone the authority to make financial decisions on your behalf. 
  3. An advanced health care directive with medical power of attorney designates an individual to make medical decisions for you in the event that you're unable to do so, and spells out the type of care or life-sustaining measures you do or don't want.

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You might also want to consider a revocable living trust if you're concerned about avoiding probate. It is a must for anyone who owns property in another state. It takes more time and money to set up a revocable trust, but it does keep your estate private and could make it easier to settle. However, if any of your assets are not owned by the trust nor beneficiary designations coordinated with the trust, your efforts may have been for naught.

Keeping your beneficiary designations current on any IRAs, 401(k)s or life insurance policies is essential. These assets pass directly to your designated heirs. The will does not control assets that have a named beneficiary.

Consider writing an ethical will.

Taking care of the financial side of an estate plan may be the easiest part of an estate plan. It's practical, and there are prescribed ways to handle distributing your wealth, no matter how large or small your estate. Preparing an ethical will takes a lot of soul searching. An ethical will is not binding on your heirs, but it does put in writing what you would like your wealth to accomplish.

Here are some questions to ask yourself before preparing an ethical will:

  1. How do I get to the root of my real values?
  2. What are the most important lessons, thoughts, ideas, and experiences I want to pass on to my loved ones?
  3. How do I want my heirs to use their inheritance?
  4. What are the traditions and values I want my heirs to carry on?
  5. How do I want to be remembered?

There is no pre-determined format for writing an ethical will, but there are many examples of ethical wills, as well as tools and tips for writing your own at websites such as celebrationsoflife.net and life-legacies.com.

Taking the time to get your estate planning documents completed is incredibly important. Dying without a will leaves a terrible void in any family unit. Taking the extra step and creating an ethical will has been described as "an estate-planning love letter to your family." Let your family know that you loved them by completing your estate plan. Contact your Western Fraternal Life agent for additional information about estate planning.



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Category: Estate Planning

Julie Cole

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CFP®, FLMI, Annuity Product Manager


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