Many New Jersey residents fail to make estate plans, and they often cite the same reasons for failing to do so. Some people do not bother creating an estate plan because they feel as if they lack sufficient assets and therefore do not need to do so. Others neglect to create estate plans because they do not have kids and therefore feel as if an estate plan is unnecessary. Both assumptions are false.
However, Bankrate notes that an estate plan does not need to contain numerous elements or a high level of complexity to help people accomplish important objectives. Instead, many people create plans containing only the following three components.
1. A will
A will gives individuals the ability to outline where they want their assets to end up after they die. Otherwise, it becomes the state’s responsibility to do so, which may lead to delays and unnecessary hardships. Many people also name guardians for their minor children when putting their wills together.
2. An advance health care directive
Advance directives come in several types. While different types do different things, advance directives give individuals a chance to stipulate what they want to happen to them medically, should they suffer incapacitation and be unable to voice their wishes.
3. A power of attorney
Powers of attorney also come in several types. They allow people to appoint someone they trust to make medical, personal or financial decisions on their behalf.
There are many other estate planning tools that help individuals accomplish more specific or complex estate planning goals. However, many people create effective estate plans that contain just the three above-named elements.
