Planning for the Inevitable: The Basic Estate Planning Documents That Everyone Needs

Far too many of us fail to take the time and effort to set up a basic estate plan in the event of an untimely passing.  It’s easy to understand why.  No one wants to think about how their estate is handed down after they pass away.  In spite of that, taking the initial steps of having a few basic estate planning documents prepared will go along way in assisting your heirs with the devising of your assets.  More than that, however, it allows you to have direct control over how you estate is handled after you pass away based upon your final wishes.

1. Last Will & Testament

The last will and testament is by far the most important estate planning document you can have.  The main purpose of preparing a last will and testament is to legally pass down your property to your beneficiaries.  Property that can be distributed in a will includes, but is not limited to, money in bank accounts and investment accounts, real estate, personal property (jewelry and other valuables), and vehicles and other titled property.  A will gives you the final say on the disposition of your assets, and it avoids having to follow the Florida Intestate Statute; whereby, the state will dictate how your estate is passed down to the beneficiaries.  Passing away without a will (or, “intestate”) also creates headaches for your descendants with having to follow a complicated process and, in some cases, gives rise to disputes between family members over money, personal items, et cetera.  While the disputes between family members may be inevitable, at least everyone knows that a will sets forth your last wishes, and a probate court will not overturn a person’s last wishes, so long as the will was executed in accordance with Florida law.

In order for a will to be valid in Florida, the individual who’s signing the will (the “testator” or “testatrix”) must be eighteen (18) years old and of sound mind—mentally competent and free from the effects of drugs and alcohol—at the time the will is executed.  The will must be notarized and signed in the presence of two (2) witnesses who must also sign the will in front of the testator.  Florida also allows recognizes handwritten wills (otherwise known as “holographic” wills) written out by the testator, so long as the will is also properly witnessed by two (2) witnesses.  Video wills and audio wills are not recognized.

2. Durable Power of Attorney

Depending on the situation, a power of attorney can have very broad authority, as is the case with a general power of attorney, or very limited, as with the case with a special power of attorney.  A general power of attorney allows someone to give broad authority to someone else handle a range of important activities such as buying and selling real estate, paying taxes, and handle banking transaction.  A special power of attorney is typically drafted for a specific or limited purpose and has a set duration before it expires.

A durable power of attorney is an important estate planning document because it allows the designated agent to retain the authority provided within the document even when the author is incapacitated.  The durable power of attorney can be drafted as either general or specific.  The following specific language from Chapter 709, Florida Statutes is required in order to create a durable power of attorney:

“This durable power of attorney is not terminated by subsequent incapacity of the principal except as provided in Chapter 709, Florida Statutes.”

The importance of this document should be obvious.  Should you find yourself incapacitated after a car accident or other injury, or should you become mentally incapacitated by other means, the documents provides the authority for the designated agent to pay your bills, buy or sell real estate, and otherwise manage your assets.

In order for a power of attorney to be valid, the agent must be a natural person who is at least eighteen (18) years old.  The author must sign the document in front of two witnesses and it must be acknowledged by a notary.  The agent cannot be a witness or a notary.  The agent must act in good faith and not contrary to the author’s best interests.

3. Healthcare Surrogate and Living Will

Healthcare Surrogate Designations and Living Wills are the final two documents that people should have in their estate planning arsenal.  These documents serve two distinct purposes, but are vital when it comes to making major medical decisions.

In Florida, a Healthcare Surrogate Designation allows you, as the principal, to appoint an agent to make healthcare decisions for you or receive private medical information on your behalf in the event you cannot make major healthcare decisions for yourself.  Think about it as a power of attorney, but for medical decisions.  These are mainly found with elderly patients who lack the mental capacity to make informed decisions for themselves.  They are also extremely useful should you suffer a traumatic accident and need someone, your agent, to make medical decisions for you if you’re incapacitated.  The surrogate designation remains effective until the termination date on the designation or until terminated by the principal.

A living will is a document signed by you, again as the principal, to authorize an agent to direct your doctors to withhold lifesaving treatment if there is reasonable medical certainty that you will not recover from a terminal illness or vegetative state.  It’s purpose is to allow the principal to pass away with dignity rather than to be kept alive with no quality of life.  This document appoints one person to make this incredibly tough decision and avoid potential family disputes and tensions that could arise should more than one person be grappling with the decision.

Conclusion

The documents described in this blog are the basic estate planning materials that everyone should set aside time for to complete.  As always, it is strongly recommended that you contact an experienced estate planning attorney to make sure these documents are prepared accurately and are executed lawfully.