As we continue to brave the impact of the pandemic, estate planning is a topic on many people’s minds. With the uncertainties we are all facing, now is good time to review your estate planning documents and/or ensure you have the basics in place should you become ill and hospitalized.
Preparing an estate plan with the following documents relieves family members from being burdened with tough health and financial decisions, here are a few to consider:
Medical Power of Attorney (Patient Advocate Designation) – This document appoints someone you trust to make medical and mental health treatment decisions for you in the event you are unable to do so for yourself. Given the nature of the current outbreak and new restrictions hospitals have on visitors, family members are being turned away while many hospitals are allowing Medical Powers of Attorney in. Without one already designated, your family will need to spend time and money on requests through the probate court to assign one for you.
Living Will – While your Medical Power of Attorney appoints someone to legally act on your behalf, your Living Will outlines your wishes for him/her to follow in regard to end-of-life treatment should you become incapacitated and cannot communicate them yourself. Decisions like these can be very heartbreaking for family members to make, so having this document takes them out of your family members’ hands. This document, usually paired with a Medical Power of Attorney, is known as your Advanced Directive.
Delegation of Parental Powers Over Minor Children – While guardianship of minor children is important for making sure someone you trust is legally appointed to take care of your kids in the event of your death, it’s also crucial in times like these. Given the current pandemic, you could find yourself needing to be quarantined away from your children or hospitalized for treatment, so this document appoints someone you trust to temporarily have custody of and care for them.
HIPAA Authorization – This is a back-up document that allows your family members or patient advocate designee to access (or not access) your medical records. This form makes it very clear who can and cannot receive that information.
Durable Financial Power of Attorney – This authorizes someone you trust to act upon your behalf in regard to carrying out your financial affairs. Again, should you become incapacitated, this person is able to continue to pay your bills, sign checks, make deposits, sell and purchase assets and sign tax returns. As with the Medical Power of Attorney, without one, your family will need to spend time and money on requests through the probate court to assign one for you.
Revocable Living Trust and Last Will and Testament – These documents are directives for your loved ones on how to handle your money, property and assets so your family will be taken care of if you pass away. One of their main differences is, while a Last Will and Testament becomes effective after you pass away, a Living Trust gives you the ability to plan for situations where you become incapacitated since it becomes effective the moment it’s signed while you are still living.
Whether you are facing a small personal crisis or a global pandemic, these documents are the legal tools that you need to give yourself and your loved ones some protection and peace of mind. If you don’t have these in place, this is a good time to do so. If you have questions on how to get started, we can help.
This material is intended to provide general financial education and is not written or intended as tax or legal advice and may not be relied upon for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel.