The season of gratitude, family, and celebration is a great time to think about providing your loved ones with a gift that can bring your entire family peace: An estate plan.
I know if you don’t already have an estate plan in place, you probably have your reasons. Maybe it’s uncomfortable to think about planning for “the end.” Maybe you think, because you’re married, all your assets will go to your spouse anyway, so you don’t even need a will. (You’re likely wrong, by the way.) Maybe you haven’t even considered your own end-of-life plans.
It’s time to set aside whatever excuses you’ve made and consider the benefits your family can gain with a solid estate plan.
Many believe creating an estate plan simply addresses who gets your stuff when you die. While this is an important part of an estate plan, it does not paint the entire picture.
In recent months, my firm has received an increased number of calls from individuals suddenly dealing with an incapacitated loved. Callers ask if they can get a Power of Attorney to make medical decisions for, or use money in the checking account of, their incapacitated family member.
But when the time of need arises, the time for preparation has passed. These important documents must be executed when the person signing understands the terms, affirmatively agrees to them, and signs them willingly, without any undue influence. We don’t put these documents in place because we need them. Rather, we put them in place in case we need them.
There are a few things you should know about Powers of Attorney. Under Texas law, a Medical Power of Attorney allows you to authorize someone to make medical decisions for you, but only if you are unable to make those decisions yourself. This means any time you can make decisions about your own medical care, you, exclusively, have the right to do so.
If, however, you’re under general anesthesia for a surgical procedure, something unexpected occurs, and a decision needs to be made as to whether or how to address it, the person you name as your agent in your Medical Power of Attorney has the authority to make that decision for you. When you recover from the anesthesia, the right to make those medical decisions returns to you.
A Financial Power of Attorney, or Statutory Durable Power of Attorney, addresses a wide array of contract issues. You can customize your Financial Power of Attorney to allow the person you name as your agent to perform specific tasks on your behalf, or you can grant them broad authority to handle any financial and contractual matter imaginable. You can also choose whether to grant that power immediately upon signing the document or designate that it only takes effect upon your incapacity.
Generally, I recommend choosing the option to make the Financial Power of Attorney effective immediately, because if someone is going to sign your name for you and perform tasks on your behalf, you are going to name someone you trust. If you don’t trust someone to handle your affairs properly while you’re able to look over their shoulder, you shouldn’t trust them to properly care for your affairs when you’re incapacitated.
Medical and Financial Powers of Attorney are just two small components of a well-constructed estate plan. But, in my practice, I’ve seen these two documents have the broadest impact on individuals and their families. Putting these documents in place not only allows you to decide who has authority to assist you, but also helps prevent the need for costly, time-consuming guardianship proceedings if you become incapacitated.
I encourage you to put these documents in place if you do not already have them. If and when you do, share copies of them with the individuals you’ve named in them. If the people to whom you grant authority do not have access to these documents, they cannot use them to help you.
Show your loved ones you want to make things easy for them: Give them the peace of mind that your affairs are in order.