An ethical will is one way that New Jersey residents who are creating an estate plan may pass on their values to their family. It is separate from the will and other estate planning documents and might be thought of as a letter to family members describing the most important challenges and lessons of a person’s life. While not legally binding, it may be an important part of an estate plan for some people.
Other important components of an estate plan include wills, powers of attorney and health care directives. A will may appoint guardians for minor children and describe how assets should be distributed among loved ones. The other two documents make provisions in case a person becomes incapacitated. A power of attorney names someone to handle the financial aspects of a person’s estate if they are unable to do so while a health care directive and health care power of attorney chooses someone to manage a person’s medical situation and leaves information about a person’s wishes for their health care.
A revocable living trust may be used in place of a will to keep the estate out of probate and may be useful in some situations. Some assets might be passed down using beneficiary designations.
Creating an estate plan is a way of helping loved ones not just financially but emotionally. An estate plan that makes a person’s wishes clear may reduce the likelihood of conflict. People might want to discuss their estate plan and their rationale for that plan with family members. This is an additional way for them to pass on their values as well.