Estate planning, when properly done, could more appropriately be called lifetime planning.

Every day, thousands of people have unexpected accidents or health events. And death is not the only potential outcome.

What if you survive? What if you are in a coma or are incapacitated? Can funds be accessed to ensure your bills are paid and your family fed? Can income tax returns be filed? Will your businesses continue to operate uninterrupted?

Failure to plan can result in expensive and unintended consequences. Below are several key areas to consider.

Have a plan
A will is a legal document that expresses your wishes regarding who will represent you after death as an executor and provides guidance to that executor regarding how and to whom to disburse the assets not otherwise having beneficiary designations. Should you or your spouse die without a will (i.e., intestate), the laws of your state of residence will direct what happens to your assets and your minor children.

Without a durable power of attorney or a revocable living trust, financial institutions and others will not speak with someone attempting to assist you with your financial affairs. Married persons may be able to rely on a spouse for financial access; however, spouses can be incapacitated from a single accident as well.

Dying suddenly seldom happens. What if you are critically injured or terminally ill instead? If you failed to legally express your wishes with regard to your end-of-life care, your family will be unaware or unable to carry out your wishes. A health care power of attorney or similar legal document can empower the persons of your choice to direct your medical care consistent with your wishes. Keep the documents safe and ensure your preferred person has access to them.

Beneficiary designations
While the will is a key document, the disposition of many assets is made via beneficiary designations. Life insurance, retirement plans and many bank or financial accounts have beneficiary designations or are held as joint tenants and will go directly to someone at death. Properly designating beneficiaries on retirement plans can impact the overall income tax and the options available to your heirs after your death. While you still have capacity to do so, ensure these designations are consistent with your intent and overall estate plan.

When you have minor children, you need legal documents stating your preference regarding guardianship. Consider all alternatives — spouses often are in accidents together. Should you have young adult children or others dependent on you for care or financial support, various type of trusts can ensure this support continues during periods of incapacity and after death.

Both income tax and estate tax should be considered when planning. As the majority of us will not have immense wealth, under current law, most people will not owe the IRS estate tax at death.

Income tax is another matter. Inheriting property is generally not a taxable event; however, liquidating certain inherited property (e.g., individual retirement accounts, installment notes, and annuities) can result in significant income tax. Proper planning before (and sometimes after) death can help minimize overall income tax.

Ensure the plan stays current
Changes occur in your family structure, your financial situation, your personal wishes, and with tax law. Review your estate documents and your beneficiary designations annually.

Proper planning should involve a qualified estate planning attorney, investment advisors and your accountant. Although consulting qualified professionals is an investment now, a “do it yourself” effort on your part can result in significantly higher fees later.

This article was originally published in the Milwaukee Business Journal