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The must-have on your Bucket List

October 15, 2010

In the 2007 movie The Bucket List, Jack Nicholson and Morgan Freeman‘s characters created a wish list of things to do before they “kicked the bucket.”  The contents included a safari, driving motorcycles on the Great Wall of China, and other awe-inspiring and uplifting experiences.  Here’s one must-have item that should be on everyone’s bucket list: Create an Estate Plan.  The thought of making an estate plan does not usually conjure up feelings of excitement and laughter like the movie’s list.  Also, estate planning is admittedly a terrible subject if you’re trying to make a Hollywood hit movie. But in the real world, it is essential to create one, especially if you are a parent because it allows you to control the answers to two important questions:  Where is my money going and more importantly, where are my kids going? 

Those who pass away without a will, leave it up to the state to decide how to divide assets using a preset legal formula.  Most people would rather not leave it up to Massachusetts law for many reasons – one being that they want to know that their family will be provided for and secure. 

An estate plan can give families security not only in death but also during any period of incapacity.  It is commonly thought that a regular estate plan consists only of a simple will, but that’s just one piece of the puzzle.  A complete plan will also include a health care proxy, durable power of attorney, a living will and possibly a trust.  To give a short overview of each, the will transfers your assets to whom you want and names your children’s guardian; a health care proxy gives someone the authority to make medical decisions for you if you cannot; a power of attorney allows someone to make financial decisions for you if you cannot; and a living will expresses your desire to accept or refuse life support in the event of an incurable injury, disease, or illness.  Finally, a trust is an option for someone trying to minimize estate taxes or keep assets out of probate.  In general, an estate plan is not complete if it doesn’t have these key documents in place.

As parents, we do all we can to protect our children and make them feel secure in their world.  We teach them right from wrong. We buy them organic foods, plastic bottles with no BPA for their health.  We invest in their future by opening college savings plans. Whatever we do for our kids, we try to look out for their best interests. That’s exactly what a good estate plan will do for you and your family.  Still, more than 70% of people in the U.S. do not even have a simple will.  The likely reason for that is estate planning causes us to consider our own mortality which can be a difficult thing.  But once you do it, you can rest easy in knowing that you have taken care of your family as best you can. 

Now, cross off “Create an estate plan” from your bucket list and get moving on to more exciting things – like skydiving.

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