Estate planning is more than creating a will, talking about the future with your loved ones, and hoping for the best. With the right approach, you will find that there are many ways to better prepare for the future.
Many estate plans include both a living trust and a power of attorney, however, some people are unsure of which one is better or whether they should have both.
Living Trust vs. Power of Attorney in Bellevue
Think about it this way: your living trust is your primary estate planning document. This oversees the management of particular assets if you become incapacitated as well as the distribution of these assets upon your death.
Note: with a living trust, you are required by law to re-title your assets to the trust, meaning that you are no longer the owner (your trust is). From there, your agent, known as a trustee, has the ability to manage all the assets included in your living trust.
You have the right to include as much or as little as you want in your trust. For example, many people leave particular assets out of their trust, including: life insurance policies, annuities, retirement accounts, and Social Security.
What about a power of attorney? With this, your agent has the ability to manage non-trust assets. These are the assets that you did not transfer to your trust. With this in place, your power of attorney can also manage any assets that you forgot to transfer to your trust.
Note: a power of attorney in Bellevue gives your agent the ability to oversee and manage a variety of issues, such as speaking with financial institutions on your behalf and accessing your mail.
When it comes to the estate planning process, don’t get stuck thinking that you have to decide between a living trust and a power of attorney. As noted above, it is best to have both of these in place as soon as possible. These have two entirely different purposes, so make sure you know the pros and cons before moving forward.
With the assistance of an experienced Bellevue estate planning attorney, you will be well on your way to learning more about how and why to create a living trust and a power of attorney. Don’t get caught thinking that it is “one or the other.” A comprehensive estate plan in Bellevue will include both of these, ensuring that your wishes are taken care of should you become incapacitated or pass on.