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Financial Wardrobe - Complete Series

At this point in our #FashionSense series, your financial essentials have all been covered and you should be feeling pretty put together.  There is just one last thing you need to do to complete your look… accessorize! In the words of Oscar de la Renta, “a woman makes an outfit her own with accessories.” Consider an estate plan to be your financial accessory; it’s your unique way of expressing yourself, yet is easy to overlook.

Think of an estate plan as your rule book for what happens upon your incapacitation or passing. It’s an important financial accessory, yet most American’s don’t have one. Whether it’s avoiding the unpleasant thoughts, or the idea that you are too young, or not wealthy enough to need one, no excuse will matter if the unexpected occurs. While sometimes a single statement necklace is all an outfit calls for, you will need more than one document to handle issues that arise from incapacity or death. Your financial wardrobe will be officially complete with an estate plan that consists of the following:

Living Trust: A living trust lays out your wishes regarding how your property should be managed or distributed in the event of your incapacitation or death. A primary benefit of the trust is that it passes property outside of the court system, avoiding the often expensive and time consuming process of probate.
Will:  A will nominates guardians for your children and also allows you to nominate a conservator to make healthcare decisions on your behalf (just in case you don’t have a valid healthcare power of attorney in place). It is also the means for pouring over any assets that (for whatever reason) weren’t titled in the name of your trust to the trust for distribution. 
Power of Attorney (POA) for Financial Matters: A POA allows you to appoint agent(s) to take specific actions related to your finances, should you be unable to perform them on your own (i.e., signing tax returns, managing retirement account distributions).
Health Care Directive: A healthcare directive (aka durable power of attorney for healthcare) allows you to appoint individual(s) that will have the power to make medical decisions on your behalf in the event of your incapacitation. It also allows you to specify the type of care you want to receive.  
HIPAA Authorization: This document allows you to designate who has access to necessary health information so that they can make informed decisions on your behalf (typically trustees, agents under powers of attorney for financial and health matters, executors and conservators).
With this finishing touch, your look is complete and so is our #FashionSense series!  Piece by piece you have created a financially buttoned up life of which you should be proud. You can now head out for the day looking great and feeling confident.