Around 45 percent of people who are 55 or older don't have an estate plan in place. This puts their family members in a precarious position because they might not know what their loved one wants. Instead of leaving their final days and the disposition of their assets to chance, all Americans in this age group should take the time to create an estate plan.
When you don't have an estate plan in place, a few things happen. You won't have any say in what happens with your health care or finances in your final days. You also won't be able to decide who is going to get your assets when you pass away. As a general guideline, adults should have a plan for all of this in place by the time they are 50 years old.
Document your wishes
There is a chance that you will be unable to make decisions for yourself toward the end of your life. Conditions such as dementia or Alzheimer's can come on without much warning. Other conditions can also impact the ability to make your own decisions. You should make plans for this when you are still able to think about how various things will affect your life.
You have two things to do to prepare for the possibility of needing others to decide on your medical care. One is that you should get a living will created. This outlines the medical care you want to accept or avoid. Be as specific as you can.
If you don't want to be resuscitated, you need to have a special document known as a Do Not Resuscitate Order in place and on file with everyone involved in your medical care, including the local hospital. Without this document, there is a chance that you will be resuscitated.
Name your advocates
On top of these documents, you should also name someone as your health care power of attorney. This person will ensure that your wishes are followed when you can't do this on your own. They should be familiar with your wishes so it is a good idea to talk to them while you are able to convey your thoughts.
While it doesn't really have anything to do with your health care, you also need to plan for your finances if you are incapacitated. Naming a power of attorney for finances gives the person named the ability to pay your bills and handle other financial matters for you. This can be the same person as your power of attorney for health care, but doesn't have to be.
These are important parts of your estate plan, but they aren't the only ones you need to think about. Having a comprehensive plan in place helps give you peace of mind and provides instructions for your family members.