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Home / Firm Blog / Estate Planning / Few Americans Have an Estate Plan
02
February
2015

Few Americans Have an Estate Plan

Studies show that only 30% of all Americans have a Last Will and Testament in place. Even less have set up a power of attorney or patient advocate designation. Why don't the vast majority of Americans have an Estate Plan? Studies show that about 20% of Americans mistakenly believe the ownership of their possessions will automatically transfer to their family when they pass away. About the same percentage of Americans just think establishing an estate plan is too expensive. The truth is that (i) without a proper estate plan your property may not automatically transfer to your loved ones—probate may be required to accomplish this and (ii) establishing an appropriate estate plan may not be as costly as you think—and it certainly can be less expensive than the costs associated with probating an estate.

An effective, basic estate plan includes the following documents, each of which has a specific purpose:

  1. Last Will and Testament. A "testator" (that's the person making the Last Will and Testament) uses her Last Will and Testament (Will) to provide directions on how her property should be distributed when she dies. Perhaps more importantly, a testator with minor children may use the Will to state who she would like the guardian of her children to be upon her death.
  2. Durable Power of Attorney. A "principal" (that's the person making the Durable Power of Attorney) uses the Durable Power of Attorney to appoint an agent to handle her financial affairs in the event that she becomes incapacitated and unable to manage her own affairs. Typically, the agent is given authority to manage bank accounts and property, file tax returns, pay bills, etc.
  3. Durable Power of Attorney for Health Care/Patient Advocate Designation. A "patient" (that's the person making the Durable Power of Attorney for Health Care/Patient Advocate Designation) uses this document to select an agent (usually a close family member or friend) who will make medical decisions for her in the event that she cannot make her own medical decisions. This document may also provide the agent with directions to ensure the Patient's wishes are followed in the event she is in a coma or persistent vegetative state.

Other estate plans, for individuals with significant assets, may include a revocable living trust, irrevocable trust, or other more sophisticated estate planning documents.

If you'd like to have your estate plan reviewed or would like to establish an estate plan, feel free to contact a Gallagher Law Firm estate planning attorney—we'd love to help.

DJW2013web

David J. Williams
Attorney, The Gallagher Law Firm, PLC

Categories: Estate Planning

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