Am I Too Young for an Estate Plan?
If you are reading this article and you don’t have an estate plan, it is likely that your answer to the question posed above is “no.” The three documents in a simple estate plan are 1. Last Will and Testament 2. General Durable Power of Attorney 3. Advance Healthcare Directive. I will take each one in turn and point out some of the benefits of having these documents in place.
Last Will and Testament
Many think that a will is simply the document that distributes your assets upon your death, so if you don’t have many assets, you don’t need a will. While the will does allow you to determine how your assets are distributed at your death, it also has other benefits. In your will you are able to nominate your executors who are the individuals in charge of handling your estate assets and debts upon your death. Also, the will gives you the ability to waive the requirement that your executor post a bond before serving in that capacity. For many young couples, the most important aspect is that you have the ability to name guardians of your minor children in the event that something happens to you or you and your spouse as the case may be. If there is no guardian nominated in a will and the parents of the minor are both gone or otherwise incapacitated, there could be a contested lawsuit among the family members of the minor giving a judge the ability to determine who has the ability to serve as guardian of your children.
General Durable Power of Attorney
Most commonly referred to as a power of attorney or POA, this document gives another person called an agent the ability to act on your behalf. The power of attorney is typically used for the management of personal property and real property meaning all of your land and for lack of a better term, all of your stuff. Many people think that just because a couple is married the spouse can access all of their bank accounts, financial accounts, or generally sign their name. This is simply not true. If any account is only in your name, your spouse, or any family member for that matter will not have access to that account. If for some reason, you became incapacitated and you did not have a power of attorney in place, your spouse would have to petition the court in order to gain access to all of the accounts just in your name, or worse yet, in order to sign your name on a deed if they were trying to sell your house.
Advance Healthcare Directive
Much like the power of attorney, the advance healthcare directive is often referred to as a medical power of attorney. This document gives the ability to another person to make medical decisions for you when you cannot communicate. Many people believe that their spouse has the ability to make these decisions by the nature of their marriage. However, this is not legally correct. Further, the provisions of HIPAA do not allow your spouse to view your medical records without a waiver which is typically in the advance healthcare directive. Imagine how terrified and frustrated your spouse or other loved ones would be trying to make or communicate healthcare decisions for you without having all the information because of HIPAA. The waiver contained in this document can prevent that possibility.
This article just touches on some simple examples of why everyone who is an adult should have an estate plan. There are ways to handle situations if an unforeseen event happens and somebody does not have these documents in place, however, those scenarios generally take more time to resolve and are much more costly as a judge typically needs to be involved. Create certainty and peace of mind by contacting us today.