Marriage: Estate Planning

It's hard at the beginning of a marriage to think about the end of a marriage. But in "Until death do us part," you're setting the stage for one of you eventually to have to deal with the death of the other. Putting the legalities in place well in advance of the actual death of a spouse will allow you both to make decisions together, with a clear mind and without the stress of losing a loved one.

Wills
A will is the first step in estate planning and should be at the top of your new married "to do" list. After you die, the provisions of your will determine who will inherit your property, who will become the guardian of your children, and who will wrap up your financial affairs.

Trusts
A trust allows you to have more control over the money you leave to someone than does your will. For example, if you leave money to a young child, it can be put into a trust and only be used for education. Or the money could be disbursed to the child when he or she reaches the age of 18, 35 or even 50. A trust also protects the money from creditors since it cannot be taken from the beneficiary to pay debts. You even can control what kind of an account the money is put into and how it is invested.

Powers of attorney
If you are unable to make legal decisions because you are somehow incapacitated, someone will need to make these decisions for you. You need to decide who this person will be in advance. This is called giving someone power of attorney.

There are two main types of powers of attorney. A durable power of attorney gives a person, or people, authority to manage your finances and other legal affairs for you if you are not capable of managing these yourself. It can be long-term or short-term and allows the party that has power of attorney to use your money to take care of you, sign your tax returns, handle your investments, and other important matters. The power of attorney can be effective now, or be a springing power that becomes effective only upon your incapacitation.

A healthcare directive is a power of attorney that allows the person you designate to make healthcare decisions for you if you are unable to make those decisions yourself. For example, someone holding power of attorney can decide on heath care options, and possibly even ask doctors to turn off your life support systems if he or she feels that is what you would have wanted.

Living will
A living will is a clear statement about your wishes regarding artificial life support. If your brain is dead and your body remains functioning only with the help of life support, a living will directs attendants in what choice to make for you.

Testamentary letters
A testamentary letter is similar to a will except that it deals with items of smaller value. Through this handwritten letter you can designate who inherits such items as dishes, art, photos and other heirlooms. This letter is a handwritten document, and it should be referenced in the will. Many states recognize a testamentary letter as legally binding, but it is probably a good idea to have your letter signed by a witness.