Are You Risking Your Family's Future? Suze Orman Says Creating These 4 Documents Can Give You Enormous Peace Of Mind

Renowned financial advisor Suze Orman recently shared four critical estate planning documents on her blog that will provide anyone with peace of mind: a will, a revocable trust, a financial power of attorney, and an advanced directive. 

In her blog, Orman states that while much of the financial advice she offers requires a long-term commitment, creating these documents can be accomplished in 30 minutes, and they protect you and your loved ones. 

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"A will is necessary to ensure all of your possessions are transferred into your trust to avoid the costly and time-consuming probate process, as well as appointing a guardian for your minor children," Orman writes. 

According to estate planning experts, despite being relatively simple to create, more than half of American adults don't have a will. While the validity of a will varies by state, in some places, like Michigan, you can handwrite a will, sign and date it, and as long as two disinterested parties (who won't be receiving anything from the will) witness this, it's valid. 

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The next item Orman stresses creating is a revocable trust, regardless of your net worth. She states that a revocable trust will ensure your assets pass as seamlessly as possible to your heirs and give you total control of that inheritance – allowing you to make changes if needed. 

Because life is unpredictable, and there may come a time when you are unable to manage your financial affairs due to illness or other unforeseen circumstances, Orman recommends designating financial power of attorney to someone you trust. This person would handle your finances should the unthinkable happen and ensure your finances are in good hands. 

When setting up a financial power of attorney, finance experts recommend designating an alternative agent to manage your financial affairs in case your first choice is unable or unwilling to serve.   

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Finally, an advanced directive outlines your medical wishes in case you are not able to communicate them yourself. It specifies the level of care you want, including whether or not you wish to be on life support should the need arise. In her blog, Orman writes, "And because you may not be in a position to have these conversations directly with your care team, you need someone who has the authority to speak up and advocate for you." 

According to LegalZoom, 56% of Americans believe that estate planning is important, yet only 33% of U.S. adults actually have documents in place. In 2021, 75.12% of estate plans made were wills, 18.78% were trusts, and 6.1% designated guardianship for young children.

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According to a Care.com survey, four out of 10 Americans say they don't need a will because they are too poor. Over 40% of people wait until a health crisis to even consider creating a will or other estate planning documents. 

Orman emphasizes the importance of taking these protections sooner rather than later to have the peace of mind you deserve. Don't wait until the unthinkable happens. 

Consulting a financial advisor can be invaluable for personalized advice tailored to your specific situation. They can ensure your estate planning strategies align with your long-term goals and provide additional guidance to safeguard your family’s future.

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