A will is the most fundamental estate planning document used to identify the individuals and entities to receive the money, property and other assets owned by an individual at the time of death.  In addition to providing for the desired distribution of assets upon death, a will is used to nominate a guardian to care for minor children.  A will generally includes a nomination of an executor, the individual or entity appointed by the court to oversee the financial affairs of one's estate during the course of probate.

                        It is important to note that wills do not govern assets which have a designated beneficiary such as a life insurance policy or an individual retirement account.  Wills are also not applicable to assets which an individual holds in joint tenancy at the time of his death.  A bank account, shares of stock, or real property held in joint tenancy with another person will pass to the surviving joint tenant regardless of the provisions in a will.

                        An Advance Health Care Directive is a document used to appoint another person to make decisions about medical care after the individual is unable to make decisions for his or her own benefit.  It may also be used to indicate a desire not to receive treatment that may only prolong the dying process if one is terminally ill.

                        The California Medical Association provides an Advance Health Care Directive kit which includes a form used to accomplish these objectives.  Since this form is widely used, it is quickly recognized by doctors and hospitals in the event one is unable to make his or her own medical decisions.  If the form does not completely and accurately express one's wishes, additional instructions may be attached or an Advance Health Care Directive may be specifically written to incorporate all necessary statements about health care matters.

                        A Durable Power of Attorney is a document in which an individual known as the "principal" appoints another individual as his or her "agent".  The agent has authority to make financial decisions and sign documents concerning financial matters for the principal.  A Durable Power of Attorney may be general or limited.  A general power of attorney includes very broad powers authorizing the agent to undertake almost every decision that the principal could make personally.  However, general powers of attorney do not include the power to make gifts unless that power is specifically stated in the document.  A limited power of attorney sets forth specific powers which may be exercised by the agent on behalf of the principal.  It is typically used for a specific purpose where the principal desires the agent to have only particular limited powers.

                        A Durable Power of Attorney is effective even though the principal is incapacitated.  This is the prime advantage of a "durable" power of attorney over an ordinary power of attorney.  A durable power of attorney may be effective immediately upon its execution, or it may become effective only in the event that the principal is incapacitated.  A power of attorney that takes effect only when the principal is incapacitated is known as a "springing" durable power of attorney.  All powers of attorney are ineffective upon the death of the principal.

                        Estate planning should generally include consideration of at least three types of insurance to provide for the financial well being of the individual and his or her family in the event of adverse circumstances.  There are three specific types of insurance which should be considered.

                        First, life insurance is essential to provide funds needed by the insured's spouse, children, or other dependents in the event of his or her death.  Careful planning is required to determine the amount and type of life insurance necessary to protect the individuals who are dependent upon the insured for their financial well being.

                        Second, disability insurance provides funds to replace lost income when the insured is unable to work.  Disability insurance is an essential consideration for every individual who has not reached retirement age unless there are sufficient savings and other assets to offset the loss of income from one's employment.

                        Third, long-term care insurance provides funds to cover the cost of in-home or nursing home care when one is unable to provide for their own basic living needs.  Children should often consider long-term care insurance for their parents to be certain that the financial burden of their care does not fall upon the children when the parents are unable to provide for their own care.  As an individual matures, he or she should then consider long-term care insurance to provide for their own well being in the event that age or illness renders them unable to perform the daily living skills required to live independently without assistance.