| Written by Laurie Taylor |
“By failing to prepare, you are preparing to fail.”
― Benjamin Franklin
When I talk to clients about having their Estate Documents in place, I am often dismissed because “we don’t have enough money to worry about.” Estate Documents deal with much more than money. They also state your wishes and provide for your needs if you should become incapacitated.
At the bare minimum, you need to have in place:
- A Living Will – A living will is a document that provides specific instructions about healthcare treatment. It is generally used to declare wishes to refuse life-sustaining treatment under certain circumstances. If you do not want to be kept on life care support, you absolutely need this document.
- Health Care Proxy or Durable Health Power of Attorney – In the event that you are unable to make treatment decisions, the healthcare proxy allows you to choose someone you trust to make treatment decisions on your behalf. The person you pick as your proxy should use your living will directives as a guideline when they are making decisions for your care.
- Financial Durable Power of Attorney – This document has been said to be the most important. The person you designate as your Power of Attorney (POA) will act in place of you for financial purposes when and if you are unable to. If you become unable to decide for yourself and you don’t have a durable power of attorney, a court will appoint a conservator or guardian. Court takes time and money, and the judge may choose someone who doesn’t even know you or your wishes. You can specify when the power of attorney goes into effect, such as when a doctor certifies you are incapacitated. You can give the person you select as your POA, or agent, as much or as little power as you wish. For example, you may want them to be able to pay your bills but not buy stock on your behalf. Your agent is required to act in your best interests, maintain accurate records, and keep your property separate from theirs. Once you pass away, your agent no longer has the authority to act on your behalf.
- Last Will and Testament – This is a written legal document that states how you’d like your property and assets distributed after your death. Wills can be of various degrees of complexity and can be utilized to achieve a wide range of family and tax objectives. A will allows you to designate an executor to ensure your specifications are carried out. You may also name a guardian for your minor children. Your will does not govern the disposition of your property that is controlled by a beneficiary, such as retirement accounts. A Florida resident who dies without a valid will dies “intestate”, which means that a person’s estate will be distributed by the probate court as directed by law.
Once you have obtained the above documents, you should give copies of these documents to your agent(s) or executor (s). You should also submit a copy of your Financial Durable Power of Attorney to your bank or investment company before it is needed. They have a legal team that will accept or reject this document. The bank may want to change the titling of your account to reflect that you have a Power of Attorney on file. In some cases, the bank may have additional forms for you to sign. When there is a triggering event, such as you become incapacitated, your agent will need to provide identification and perhaps a letter from your doctor in order to access your money. If your Power of Attorney document has not already been accepted by your bank, your agent may be denied access to your money to pay your bills. It is better to take care of these things before they are needed.