7 WEEKLY INSIGHTS

THE AXIOM®

1. WEEK IN REVIEW

COULD RISING RATES BRING THE END OF TINA?

This week’s MoneyDo: make sure you possess these critical Estate Planning documents:

• Power of Attorney for Finances and Property, also known as a Durable Power of Attorney or Financial Power of Attorney. The Durable Power of Attorney names an individual to act on your behalf during your life, as it relates to your finances and assets. This often gives the power of attorney the ability to file tax returns on your behalf; apply for Medicare, Medicaid, Social Security and other government benefits; pay your bills and access your financial accounts. If you were to become incompetent without a Financial Power of Attorney in place, a court-supervised guardianship would be required for someone to be able to manage and take care of your finances.
• Power of Attorney for Health Care names someone to make health care decisions if you are unable to make those decisions yourself. It also gives you the opportunity to give direction to that individual if various medical situations arise.
• Last Will and Testament is the primary document that will provide how assets titled in your individual name without a joint owner or beneficiary will be distributed. Your Will also appoints an executor responsible for managing your estate and following your final wishes. If you have minor children, your will can also nominate a guardian to care for them. Assets distributed under a Will go through the court supervised, probate process.

Once you have assembled those key pieces, estate planning can and often does include additional documents depending on the nature of your assets and family situation.

• Revocable Trust, also known as a Living Trust, can be used in conjunction with a Will and become the primary mechanism to distribute assets outside of the probate process. A trust allows for continuity of management during life and after death as the trust continues automatically without having to wait for the court to appoint an executor. An important decision to make in the planning process will be naming a successor trustee to provide for a smooth transition and continuity in management of the trust assets upon your death or incapacity.
• Marital Property Agreement is an additional document that can be used in estate planning that classifies property owned as either individual or marital property. Classification of property can have an impact on how an estate plan flows when individuals pass away. A primary advantage to using a marital property agreement is that it can also be used to help avoid probate.

All five of these documents are used regularly as part of a comprehensive estate plan, in conjunction with beneficiary designations.

Beneficiary Designations, Transfer on Death Provisions and Asset Titling are also important components to ensure the estate plan you have designed will be effective and easy to administer when you pass away. Beneficiary designations, transfer on death provisions and joint accounts will pass automatically according to the terms of the account rather than under the terms of your Will or Trust. When developing your comprehensive estate plan, it is important to review and update all your accounts to fit.

We asked Annex Wealth Management’s Ron Johnson, CFP®:

Thanks for your question. Health savings accounts (HSA) offer excellent tax advantages.  Often referred as triple tax advantaged because

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