New Year’s is a time for fresh starts and thoughtful reflection, making it perfect for setting meaningful goals. One resolution to consider this year is estate planning —a way to make sure your legacy is safe and your loved ones protected. This process has several steps:

Designating a Power of Attorney:

The first step is to find someone to whom you can give Power of Attorney. A POA, as it’s sometimes called, is a legal document that allows someone to make financial, medical, and life-changing decisions on your behalf when you cannot. This person would be considered the agent and should be someone you trust the most or a reliable attorney.

There are 5 different types of Powers of Attorney: 

  • General POA gives the agent the ability to handle the majority of legal decisions but ends if you become incapacitated.  
  • Limited POA does the opposite and limits the amount of legal decision-making for an agent. The agent will only handle certain legal matters.
  • Durable POA gives agents the ability to handle legal decisions even if you are incapacitated and only ends once you pass away. It can also be used for financial and medical decisions.
  • Medical POA gives the agent the power to make medical decisions on your behalf. 
  • Financial Power of Attorney gives the agent the power to make financial decisions on your behalf. 
  • Springing POA is only allowed in certain specific situations as defined in the document.

Establishing a Trust:

The next step is to start a trust. A trust is a legal document that allows the grantor (owner of the assets) to transfer their assets to a trustee or someone who is meant to hold the assets. The trustee in turn will manage and distribute the assets to the beneficiary or the person who is meant to receive the assets. 

The two most common types of trusts are:

  • Revocable Trust: Allows the grantor to modify, revoke, or amend the trust during their lifetime.
  • Irrevocable Trust: Cannot be altered once established, providing certain tax and asset protection benefits.

Reviewing your Will:

Once you have finished designating a power of attorney and establishing a trust the next step is to review your will. There are several steps to review your will:

  • Confirming your beneficiaries and updating them as needed.
  • Reviewing how your assets will be distributed.
  • Considering the tax implications for your beneficiaries.
  • Ensuring your will aligns with your trust and power of attorney designations.
  • Updating your will to reflect any major life events, such as marriage, divorce, or the birth of a child.
  • Consulting an attorney to ensure your will is thorough and legally sound.

Start 2025 off right by tackling your estate planning. It’s a step that benefits you now and secures your future. For any questions about estate planning please contact us at Friedman, Grimes, Meinken & Leischner PLLC and we will be happy to guide you through this process.