When you create your first estate plan, you may focus on finding the best way to transfer assets to your family. It is, of course, essential, and without it, you could throw away thousands of dollars. However, dying is not the only thing you need to consider.
An effective estate plan must also consider severe illness or injury. It is something that could strike at any time, 30 years from now or tomorrow. Including the power of attorneys in your estate plan is crucial for such events.
A power of attorney allows someone to act on your behalf when you cannot
People give others power of attorney for temporary reasons — such as to sign a business contract when they are out of the country. You should also put them in your estate plan if you ever need them, be that for a temporary or permanent basis.
- Health care power of attorney: This sets out who communicates with medics on your behalf if you are unable to. The person you pick can make decisions such as whether you would like doctors to resuscitate you or keep you alive through foods and fluids fed through tubes. When nominating someone, be sure to explain your wishes to them.
- Financial power of attorney: What happens if you are permanently unconscious? Who can access the bank to pay the mortgage? Who can sell the house to fund your treatment? Who can access the bank to buy food for your kids?
An attorney can help you set up these powers of attorney in the correct legal manner. They can help you ensure they are there if you need them while limiting the circumstances in which someone can make use of them.
