Last week, we shared the first part of our series on the importance of estate planning for those without children. Here in part two, we discuss the other risks involved for those who forego estate planning.
Someone will have power over your health care
There is more to estate planning than passing on your assets when you die. In fact, some of the most critical parts of planning have nothing to do with your money at all but are aimed at protecting you while you’re still very much alive.
Advance planning allows you to name the person you want to make healthcare decisions for you if you’re incapacitated and unable to make decisions yourself. For example, if you’re temporarily unconscious following a car accident and unable to give doctors permission to perform a potentially risky medical treatment, it’s not always clear who’ll be asked to make that decision for you.
If you have a romantic partner but aren’t married and haven’t granted them medical power of attorney, the court will likely have a family member, not your partner, make that decision. Depending on your family, that person may make decisions contrary to what you or your partner would want. Indeed, if you don’t want your estranged brother to inherit your property, you probably don’t want him to have the power to make life-and-death decisions about your medical care, either. Unfortunately, that’s exactly what could happen if you don’t proactively plan.
Even worse, your family members who have priority to make decisions for you could keep your dearest friends away from your bedside in the event of your hospitalization or incapacity, or family members who don’t share your values about the types of food you eat or the types of medical care you receive could be the one’s making decisions about how you’ll be cared for. Estate planning takes care of all that, whether you have kids or not.
Someone will get power over your finances
As with health-care decisions, if you become incapacitated and haven’t legally named someone to handle your finances while you’re unable to do so, the court will pick someone for you. The way to avoid this is by naming someone you trust to hold power of attorney for you in the event of your incapacity.
Durable power of attorney is an estate planning tool that gives the person you choose immediate authority to manage your financial matters if you’re incapacitated. This agent will have a broad range of powers to handle things like paying your bills and taxes, running your business, collecting your Social Security benefits, selling your home, as well as managing your banking and investment accounts.
It’s critical that you only give this power to someone you absolutely trust. Furthermore, the person you name doesn’t have to be a lawyer or financial professional—it can be anybody you choose, including both family and friends. With us as your Personal Family Lawyer®, your agent will have access to us as your trusted counsel should they need guidance or help.
The fact that durable power of attorney is granted as soon as you’re incapacitated means your agent can begin handling your finances immediately without waiting for a judge’s decision, simply by presenting a legal document and appropriate proof of your incapacity to a financial account holder. Since courts are notoriously slow, this quick access can be immensely beneficial to ensure your bills get paid on time and you have the funds available when you need them.
Without signed durable power of attorney, your family and friends will have to go to court to get access to your finances, which not only takes time, but it could lead to mismanagement and even the loss of your assets should the court grant this authority to the wrong person.
Given all of these potential risks, it would be foolhardy for those without children to ignore or put off these basic estate planning strategies. Identifying the right planning tools is easy to do, and begins with a Family Wealth Planning Session, where we can consider everything you own and everyone you love, and guide you to make informed, educated, empowered choices for yourself and your loved ones.
This article is a service of Levi Alexander, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session, ™ during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.