Unfortunately, one of the main concerns we all need to face and address is something most people avoid — estate planning. When you do estate planning, you are mostly about to think of your mortality. Adding to the burden of mortality is that estate planning discusses all the specific details and infinite possibilities of what should happen to your money, assets, and belongings once you’ve passed. It may seem comfortable but estate planning is important especially for married couples.

It is also challenging to make an estate plan when you need to be in absolute agreement with your spouse. There is a possibility that you and your spouse may have differing opinions on things like money spending, investments, managing your kids and other factors. This can become a huge stumbling block in the process of preparing a balanced, cohesive and smooth formulated estate plan.

Another thing is that formulating an estate plan, even for the most well-adjusted couple can still be an emotional minefield. Fortunately, with some open conversations with an estate planning lawyer and little give-and-take decisions with your spouse, many estate planning pitfalls can be avoided. In this blog, we discuss why it’s important for married couples to carry out estate planning.

What is an Estate Plan?

An estate plan consists of several written documents that mostly outline your end-of-life wishes. It is also created to set how you would like your assets and belongings to be distributed upon your death. A well-rounded estate plan includes five relevant written documents:

A Last Will and Testament

It is used to set how you would like to distribute your assets and belongings after death. You can also choose an executor to administer your estate. 

Also, married couples enjoy several benefits when it comes to passing property and assets upon death. While others need to consider the tax implications of leaving amounts over a specific threshold, spouses are allowed to leave unlimited assets to each other using a will. It means that substantial assets left to an inheriting spouse are not subject to hefty taxes upon death.

A Health Care Directive or a Living Will

This written document guides your family and healthcare professionals regarding medical treatment preferences. This part of estate planning is important for married couples if one party becomes incapacitated or is unable to communicate. With this, you can also appoint a health care representative to make decisions for you, aside from your family.

Keep in mind that a living will document can only become effective if you are incapacitated to decide on your own. Without a valid living will, your doctors may or may not rely solely on your spouse and family’s wishes when determining what kind of treatment to provide. Drafting a living will is essential so that medical care can be more uniform and effective.

A Durable Power of Attorney

It is used to appoint an agent to handle all your finance, business matters, and real estate if you become unable to do so. In simpler words, it gives that person the power to carry out actions on your behalf. 

A power of attorney is a written document wherein one individual or the “principal” grants another individual or the “agent” the authority to act on his or her behalf. It often comes with a specific list of directions. When it comes to medical matters, a durable power of attorney legally allows the agent to make medical decisions relating to treatment on behalf of the principal. 

Also, when correctly drafted, it permits the agent access to the principal’s vital medical records, which may be necessary when determining the course of medical treatment.

Life Insurance or Life Insurance Trusts

As a part of estate planning, life insurance is important for married couples because it acts as a financial failsafe for spouses. Usually, it kicks in in the event of sudden death. Thus, it’s advised that you explore life insurance options with a trusted insurance agent.

An End-of-Life Plan

The document is a prime indicator of the importance of estate planning for married couples This written document is formally and legally used to establish your end-of-life wishes, like your arrangements regarding your obituary, epitaph, remains, funeral, etc.

Purpose of Estate Planning

There are many other reasons why estate planning is important for married couples. Some of them range from controlling your asset, managing belongings to lowering tax costs associated with your death. Below are some of the foremost reasons estate planning is important for couples.

By documenting all your wishes beforehand, you can:

• Control and manage who receives your assets and properties after death
• Ensure that your family is financially stable
• Specify and set child and pets custody
• Set personal medical treatment preferences
• Give thoughtful instructions for some essential matters, even in your absence
• Spare your family the cost, or time by allocating your estate
• Reduce estate taxes and other legal fees
• Streamline the passing of assets and properties to your spouse and other beneficiaries
• Select a person you trust to administer your estate
• Lessen the stress of funeral planning

Estate Planning Checklist for Married Couples

One way to potentially bypass unwanted disagreements during your estate planning is to have an attorney involved. 

With the important nature of estate planning for married couples, an attorney can help you and your spouse draft and make a checklist. This list will cover the following:

• A durable power of attorney for property, assets and finances
• A durable power of attorney for healthcare (with HIPAA release)
• Authorization for final disposition
• Asset allocation between spouses
• Appropriate beneficiary designations
• Check title to Real Estate
• Last will and testament
• Living will
• Irrevocable Life Insurance plan
• Revocable living trust
• Retirement plan trusts

Final Thoughts

Once you and your spouse understand the importance of estate planning for a marriage, you can arrive at a balanced, well-organized, smooth estate plan. It’s recommended that while you are married, you should also start creating your estate plans. However, it’s still important to be involved in one another’s plans as you are a married couple. 

For more information regarding estate planning, visit the Lichtblau office for an initial consultation at no cost. Alternatively, you can call us at 416-633-2465 for faster feedback.