Legacy Assurance Plan: power of attorney

Monday, January 29, 2018

Including Powers of Attorney in Your Complete Estate Plan

Summary: Some people think that a simple will is enough to give them the basic estate plan that they need. While a will is better than no plan at all, a complete plan contains more and can do more to protect you. One element of every complete plan is the inclusion of powers of attorney. These documents can help give you the peace of mind that comes from knowing that, if you cannot make decisions for yourself, the person who will be speaking for you is the person you specifically wanted to do so.

While the rate of people developing dementia in this country has declined overall in the last few years, the news is not all good. The popular medical website webmd.com reported on a study published in the American Journal of Preventive Medicine that revealed that, although the overall rate has dipped, rates remain higher in rural areas of the country. Another conclusion of the study was that the incidence of cases of dementia is expected to double by 2050 due to the Baby Boomers.

Whether or not you are a Baby Boomer, dementia is a possibility for which everyone needs to prepare themselves. One aspect of this preparation is estate planning. There are two powers of attorney that will appear in most any complete estate plan. One is the healthcare power of attorney. This document allows you to name the person (your “agent” or “attorney in fact”) who will make your personal, medical and other healthcare decisions on your behalf in you cannot make them for yourself due to dementia or another form of incapacitation. (The law also allows you to structure your power of attorney such that the designated powers become effective immediately, as opposed to upon the event of your becoming incapacitated.)

As with any power of attorney, it is important to choose your agents carefully and thoughtfully. Your agent under your healthcare power of attorney may have considerable decision-making authority, including determining whether or not your will enter a nursing home. Additionally, in some states, one document covers both the traditional functions of a healthcare power of attorney and a living will, meaning that your agent could also have power over your end-of-life decisions.

Another part of most every complete estate plan is the financial power of attorney, which allows the person you name in the power of attorney document to make decisions regarding your wealth and your assets. This power of attorney can grant very broad or limited powers, depending on the language in your document. You can give your agent the power simply to do maintenance activities like paying your bills, or wide-ranging authority like buying and selling assets in your name.

Another way to ensure that the management of your assets is handled seamlessly should you become incapacitated by dementia is the revocable living trust. A living trust allows you to name yourself as the initial trustee who manages all of the assets that you place within the trust. Then, should you become incapacitated, the trusteeship of your living trust will transition from you to the person you named in the trust document to serve as your successor trustee. A properly funded and maintained living trust may help you and your family avoid the need for a conservatorship, which can be an intrusive, expensive and stressful court action.

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com.

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Legacy Assurance Plan

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Monday, November 6, 2017

5 Questions to Ask Yourself as You Prepare to Choose Your Power of Attorney Agents

Summary: When you decide to take the step of getting your estate planning affairs in order, there are many decisions you’ll have to make. In a truly comprehensive estate plan, there’s more to your plan that just your will or living trust, which means there are more decisions to be made beyond just the division of your assets. When selecting the people who will act as the agents acting under your powers of attorney, it is important to consider many things, including your closeness to that person as well as whether or not you are both “on the same page” about your preferences and desires.

One set of decisions that is extremely important in any estate plan relates to who will speak for you when you cannot. As you prepare to create powers of attorney and name the agents who will act under the terms of those documents, here are five important questions that you may not have considered but are useful to contemplate as you make these decisions:

Do you get along well together? Your brother may have an M.B.A. from Harvard and may be a highly sophisticated financial whiz, but if you two don’t work well together, he may not be the best choice as the agent under your financial power of attorney. Bear in mind that, whomever you pick, you should pick someone with whom you’re extremely comfortable sharing the most intimate details of your financial life.

Does this person have financial sophistication? While, as noted above, the most financially sophisticated person whom you dislike may make poor candidate, something with whom you are very close but who has little to no financial skills or savvy might also be a flawed selection. The more complex your estate is, the more difficult it will probably be for someone without financial knowledge or skill to do the job of financial attorney-in-fact effectively on your behalf.

Does this person live nearby? This is a valid consideration with either POA. Close geographic proximity may make it easier on your agent, and easier to meet your needs, when your agent is called upon to make decisions and interact with outside professionals like your doctors or your business associates. If you are in situation where you need the aid of your attorneys-in-fact, chances are that there will be many things that must be dealt with. Choosing someone who lives 2,000 miles away will make it hard on them, and hard for them to represent you effectively.

Is this person assertive? This is something to consider when choosing either a financial or healthcare attorney-in-fact, but it is especially important with an agent under a healthcare power of attorney. If your preferences include very minimal (or no) life-extending medical intervention, your agent may have to fight hard for the enforcement of your wishes against a medical establishment “hardwired” to want to provide treatment in all situations. The more assertive your agent, the more confident you can be that your wishes will be honored and carried out.

Does this person share your values? This is an especially important concept to contemplate as you select your agent for your health power of attorney. Having an agent who is “on the same page” as you will serve two goals, both enhancing the likelihood that your preferences will be carried out, and that those goals will be fulfilled with a minimum of heartache for your loved ones. For example, if your preferences include receiving little or no life-extending medical care when you are in an end-of-life situation, it might be less than ideal to select as your agent a loved one who, whether for religious or other reasons, is steadfastly morally opposed to withholding life-extending medical care in any circumstance. Both your wishes and your loved one’s emotions might suffer in that type of situation.

This is, of course, not a complete list. There are many questions, in addition to these, you should ask yourself before making the very important selections of your power of attorney agents. This list, however, provides some food for thought and a starting point for making these choices.