Money Minute: Do You Have These Estate Planning Documents?

Money Minute: Do You Have These Estate Planning Documents?

A comprehensive Estate Plan generally consists of several documents. Of course, there is your Will which transfers certain assets going through the probate process. A Revocable Living Trust, if you choose to use one, is a Will substitute which transfers all of the assets which are owned by your Trust. In Wisconsin, generally a married couple will have a Marital Property Agreement. A typical estate plan will also include a Financial Power of Attorney, a Health Care Power of Attorney, a HIPAA Waiver and a Living Will. 

In addition, many assets transfer to designated beneficiaries, regardless of what your Will or Trust might specify. Assets held in joint tenancy automatically transfer to the survivor upon death. Retirement plans, IRAs, 401(k)s, life insurance policies and POD accounts go to your named beneficiaries. So, in addition to reviewing your Will or Trust and supporting documents, it is crucial to review your beneficiary designations to be sure they coordinate with the rest of your plan.

There are six estate planning documents you may need, regardless of your age, health, or wealth and depending on your personal circumstances:

  1. Durable Power of Attorney (Also called a Financial Power of Attorney)
  2. Health Care Power of Attorney and Living Will (also called Advance Medical Directives)
  3. HIPAA Waiver
  4. Marital Property Agreement (in Wisconsin)
  5. Will
  6. Revocable Living Trust

Durable Power of Attorney/Financial Power of Attorney

A Durable Power of Attorney (DPOA) can help protect your property in the event you become physically unable or mentally incompetent to handle financial matters. A DPOA allows you to authorize someone else to act on your behalf, so he or she can do things like pay everyday expenses, collect benefits, watch over your investments, and file taxes.

Advance Medical Directives

Advance Medical Directives let others know what medical treatment you would want, or allows someone to make medical decisions for you, in the event you cannot express your wishes yourself. If you do not have an Advance Medical Directive, medical care providers may prolong your life using artificial means, if necessary.

There are essentially three types of Advance Medical Directives:

  1. A Living Will allows you to approve or decline certain types of medical care, even if you will die as a result of that choice.
  2. A Durable Power of Attorney for Health Care allows you to appoint a representative to make medical decisions for you. You decide how much power your representative will or will not have.
  3. A Do Not Resuscitate order (DNR) is a type of Advance Medical Directive that directs medical personnel not to perform CPR if you go into cardiac arrest. There are two types of DNRs: one is effective only while you are hospitalized and the other is used while you are outside a hospital setting.

Marital Property Agreement

Marital Property Agreements can provide the terms of ownership and use of property and income during the marriage, at death and at dissolution of the marriage. In the event of death, the Marital Property Agreement can even reflect the deceased partner's agreement with the living spouse about their property.


The main purpose of a Will is to disburse property to heirs after your death. If you do not leave a Will, disbursements will be made according to state law, which might not reflect your wishes. A Will allows you to name the person (personal representative or executor) who will manage and settle your estate. If you do not nominate anyone in your document, the court will appoint someone to act. You can also name a legal guardian for minor children or for dependents with special needs.

Revocable Living Trust

A Revocable Living Trust is a separate legal entity you create to own property, such as your home or investments. The trust is called a living trust because it is meant to function while you are alive but should have provisions to handle periods of incompetency and to distribute assets at your death. You control the property in the trust and, whenever you wish, you can change the trust terms, transfer property in and out of the trust, or end the trust altogether, as long as you are alive and competent. A Revocable Living Trust is not needed by everyone. A primary function may be to avoid probate (which is possible because property in a living trust will pass outside of a probate estate).  However, there are many other reasons for which one may set up and fund a Revocable Living Trust.

Although a living trust can transfer property at death much like a will, you should still also have a pour-over-will to handle certain assets that were not titled in the name of the trust and since a trust will be unable to accomplish certain things such as naming a personal representative or executor or naming a guardian for minor children.

All information herein has been prepared solely for informational purposes only and opinions are subject to change. Past performance is not indicative of future results and all investments involve the risk of loss of principle. For information on how these general principles apply to your situation, consult an investment professional.

Article Topic Expert: Tammy Parks

Tammy is the President of SVA Plumb Trust Company, LLC. She administers trusts and other fiduciary accounts for high net worth clients and their families. These include trusts and other individually managed accounts as well as trust services without investment management. Tammy works closely with clients to help them with their estate planning concerns and objectives.

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