WILLS AND TRUSTS
Both a will and trust provide a set of instructions for how to distribute assets after you pass away. These documents have some key similarities and differences that are worth considering before you decide which approach will best fit your needs and goals. Both documents enable a person to leave assets directly to a beneficiary or establish a trust in that person’s name. However, there are key differences between the two and each approach has its own advantages and disadvantages that should be considered. The starting point of a well-crafted estate plan begins with assessing your life circumstances, assets, goals, and needs, and understanding what wills and trusts do to guide your decision making.
FINANCIAL POWER OF ATTORNEY
A power of attorney is a commonly used document granting financial authority to another person. A power of attorney gives someone else, called an agent, the right to make financial decisions about the matters you specify in the document.
There are generally four types of powers of attorney. If you do not limit the power you give to your agent, the document is known as a “general” power of attorney. If you limit the power to certain decisions, the document is a “limited” power of attorney. You may sign a “specific” power of attorney at a bank to give an adult child the authority to make deposits and write checks on a specific bank account. You can give a specific date when it will go into effect, list a particular event that would cause the power to be effective, or describe a situation when the power could be used. This type of power of attorney is called a “springing” power because it springs to life only if the event outlined in the document comes to pass.
The appointment of a health care representative and stating your health care instructions in the event of incapacity is important. This can be done through a properly and signed legal document. In Oregon, these documents are known as the Advance Directive and Appointment of Health Care Representative.
An Advance Directive is a legal document that allows individuals to identify trusted individuals as their health care representative and express their preferences regarding medical treatment and end-of-life care. In the context of estate planning, an advanced directive is an important component that ensures one’s healthcare wishes are respected if they become unable to make decisions for themselves due to incapacitation or critical medical conditions.