What happens to you and your “stuff” if you should become incapacitated or pass away? Who is in charge of taking care of your finances in the event of an illness or accident that leaves you unable to take care of things yourself? Who is in charge of conveying your medical wishes to doctors if you can’t? What if the wrong person ends up in control? Estate planning makes sure those questions are answered and the right people are in charge.
Life happens. Accidents, sudden illness, unexpected travel, and other considerations can create the need for someone to look after our affairs if we can’t do it for ourselves. Not only can that create stress for us, but it can also create unnecessary stress on our loved ones.
Everyone over the age of 18 should have at least three basic estate planning documents: General Durable Power of Attorney, Healthcare Power of Attorney, and Healthcare Directive. Living Trusts are an advanced tool for those with more complex estates.
General Durable Power of Attorney (GDPOA): This document names who you want in charge of your finances. A properly executed GDPOA can help avoid going to court to have someone appointed to take care of your affairs. The Netflix series “Dirty Money” has an episode that shows what can happen if the wrong person ends up in charge of your finances. If you want to check it out, it’s S2:E9. If a court appointment should become necessary, the GDPOA tells the judge who you trust and want to be in charge.
Health Care Power of Attorney (HCPOA): There are fewer things in life more personal and private than our medical choices. Many factors play into the ways we want to be cared for; religion, personal experience, family upbringing, and traditions to name a few. Make sure you appoint someone who knows you well and can make difficult decisions on your behalf if you are unable.
Health Care Directive: This is also known as a Living Will, Physician’s Directive, or Advanced Directive. This document makes your end-of-life decisions known to family and health care providers. A health care directive can help ease the burden of loved ones having to make hard decisions under difficult circumstances.
These documents can give your agents authority immediately or only after you have been declared incompetent by a court and/or physician(s). Documents that don’t give your agents immediate authority are called “springing.” They only spring into effect after certain requirements have been met.
It is very important to have Powers of Attorney and Healthcare Directives prepared by an experienced estate planning attorney. Basic templates and online services can be overly broad and leave out important state-specific requirements. This basically results in powerless Powers of Attorney.
Living Trust: A Living Trust is a more advanced estate planning tool. Like Powers of Attorney, a living trust can state who you want to handle your estate in the event you are unable. In most Living Trusts, you are the initial trustee in charge. In the event of your incapacity, you can name who you want as a replacement, or successor trustee. The successor trustee is then instructed on how to handle your affairs by the terms of the Living Trust. It is important to note that a Living Trust does not preclude the need for a GDPOA and HCPOA.
Make sure you are prepared when “life happens.” Consult with an experienced Tampa estate planning lawyer by calling (813) 438-8503 to get started.