Estate Planning for First Responders
2022-09-09
Posted at 13:58h
in Asset Protection, Estate Planning
Being a first responder is a high-risk job, so it’s important to plan for your family’s future in the event that something happens to you in the line of duty. At Phelps LaClair, we’re grateful for everything that our local first responders do for our community. We put together this guide on estate planning to help you prepare, just in case the unexpected happens.
Why Estate Planning Is Important for First Responders
Firefighters, law enforcement officers, paramedics, and other first responders put their lives on the line every day to protect our communities. Even retired first responders can face unexpected illnesses and deaths relating to their line of work. For instance, firefighters have a higher risk of heart disease and cancer, while law enforcement officers often experience health issues related to stress.
First responders need estate plans to ensure that their loved ones are cared for after they’re gone or if they become incapacitated. Without a will or trust, it’s up to the court to distribute your assets to your next of kin. Having the right estate planning documents in place will guarantee that your wishes regarding your medical care and finances are met, no matter the circumstances.
Four Essential Estate Planning Documents for First Responders
1: Medical Power of Attorney
As a first responder, it’s your duty to take care of others. But what happens when you need someone to take care of you? In the event that you become incapacitated by an occupational injury, you will need a medical power of attorney.
A medical power of attorney (POA) is an advance directive that gives the person of your choice the power to make medical decisions on your behalf. Having a medical POA is essential for first responders, because it ensures that you will receive the right care if you are ever unable to make your own decisions. Without this document, you have no control over who the court will grant this power to.
No matter who you choose to be your medical POA agent, it’s also very important that you discuss the role with them ahead of time. Make sure that they are comfortable acting on your behalf, and that they understand your wishes when it comes to resuscitation, being on life-support, medications, and other medical choices they may have to make for you.
2: Financial Power of Attorney
If you ever become incapacitated, you will also need help managing your finances. Similar to a medical POA, a financial POA gives someone the power to make financial decisions on your behalf. They can sign checks for you, open up new bank accounts in your name, manage your assets, etc. If you want someone you trust to handle your accounts, you’ll need to designate a financial POA. And, just like you did with your medical POA, be sure to discuss the role ahead of time with the person you choose to fulfill it.
3: Will
Creating a will allows you to leave instructions for how to distribute your assets after you’re gone. Without a will, the court will decide how to distribute your assets to your next of kin. Legally, your next of kin would be your spouse or your children, depending on your circumstances.
However, if you don’t have a spouse or children, then your assets will go to your parents or siblings, depending on your surviving heirs. If you have stepchildren or a partner who you aren’t married to, they aren’t legally entitled to your assets unless you name them as beneficiaries in a will or trust.
Another benefit of having a will is that it ensures that your assets will avoid probate. Probate is the legal process of distributing your assets, which can take a long time and place unnecessary stress on your loved ones. Creating a will also reduces family conflict and uncertainty when it comes to your final wishes.
4: Trust
Like wills, assets with beneficiary designations named in a trust will also avoid probate. However, setting up a trust gives you even more control over the future of your assets than a will. You can decide when and how your assets will be distributed, and whether the full amount will be distributed all at once, or in a series of installments. Or you can postpone the distribution of an inheritance until your child turns eighteen or graduates college.
When you create a revocable living trust, you will still be able to access and manage the assets funding it. A living trust also allows you to add and remove assets at any point during your lifetime.
Estate Planning Checklist for First Responders
Whether you already have an estate plan in place or are just getting started, make sure it has everything you need. Here’s a checklist of the steps to take when making an estate plan.
1: Take Inventory of Your Assets
Before you even decide who you want to leave your assets to, you should make a list of all of the assets in your estate as well as their estimated value. The assets in your estate plan should include:
- Real estate holdings
- Vehicles
- Life insurance policies
- Retirement accounts
- Bank accounts
- Stocks and bonds
- Business ownership interests
- Collectibles like jewelry, art, antiques, coins, etc.
2: Make a List of Your Beneficiaries
You should also make a list of everyone you wish to leave your assets to, so you can ensure that you don’t leave anyone out. It’s important to revisit this list every few years to make new additions or remove beneficiaries as necessary.
When you designate specific beneficiaries for an asset, make sure to also name a contingent beneficiary. If your primary beneficiary dies or refuses the inheritance, then the asset will automatically transfer to the contingent beneficiary.
3: Decide Who Will Fill Important Roles
Beneficiaries aren’t the only people to consider when it comes to estate planning. You must also decide who you wish to be the executor of your will, trustee of your trust, your child’s guardian, your power of attorney, etc.
Just make sure that you discuss these roles with the people you assign them to before officially naming them in your estate plan. This way they’ll be better prepared to fill their role, and when the time comes they can effectively carry out your wishes.
Estate Planning Lawyer in Arizona
The future is unpredictable, so don’t leave your loved ones guessing at your final wishes. The expert estate planning attorneys at Phelps LaClair can help you build an estate plan that covers all of your needs and helps you provide for your family’s future. We have over 40 years of experience helping Arizona first responders with their estate plans. Call us at 480-892-2488 today to schedule your free consultation.
Images used under creative commons license – commercial use (9/9/2022). Photo by Matt C on Unsplash
