Coronavirus has been a world-altering event, and for some people, what begins as a small cough can quickly escalate into a serious illness. Thankfully, for most, the symptoms appear to be mild. But it’s crucial for everyone, especially those in good health, to take steps to protect those around us who are more vulnerable if exposed to the virus. We should all look out for our neighbors and communities by staying home, washing our hands frequently, sanitizing surfaces, and following the advice of health experts.
This disease also serves as a reminder to those who have been putting off creating or updating an estate plan. We don’t know what tomorrow will bring, so for your own peace of mind and the good of your loved ones, now is the time to put aside your procrastination.
Your estate plan should include several key documents that can protect you and your family if you should become very ill or pass away.
Last Will and Testament and/or a Revocable Living Trust
A will lets you specify the individuals you would like to receive your money and property after you are gone. Your will can also name a guardian(s) to care for your dependents if you are unable to do so, and a conservator to handle their financial needs. For many, however, a will alone is not the best solution, since it only applies after you pass away, and guarantees court involvement, not while you are still alive.
If you create a revocable living trust, you can name yourself as a trustee and continue to exercise control over the money and property you transfer to the trust. A revocable living trust also lets you name a co-trustee or successor trustee who can manage your money and property if you become too ill to do it yourself. Your trust can also specify when and how the funds should be distributed to your beneficiaries when you pass away. If you have transferred all of your property into the trust, the distribution of its contents will not have to go through the probate process, which can be expensive, time-consuming, and public.
If you have specific goals, for example, protecting assets from creditors or providing for a child with special needs, some other estate planning tools may be useful.
- Note: If you leave no will or trust when you die, your assets will pass to the individuals specified in your state intestacy statute, who will receive the shares mandated by the statute. This is not usually optimal, because the people and shares spelled out in the statute may differ from those you would have specified / how you would have liked them to receive it (outright and unprotected vs protected from future creditors, divorcing spouses, etc.). Also, probate is required for your estate if you die without a will or trust, and a court will have to appoint a guardian and/or conservator to care for your children. The person appointed may not be the individual you would have chosen.
Powers of Attorney
Power of attorney lets you name people you trust to make decisions on your behalf if you become ill and cannot make them for yourself. Even your spouse may not have the authority to make all of these types of decisions for you without proper documentation.
A medical power of attorney can be used to name a trusted agent to make medical decisions on your behalf if you are unconscious or can’t communicate with your doctors. The person you name is required to act in accordance with your wishes to the extent that they know them, so it is important to tell them about your preferred providers, medical conditions, treatments you do not want, religious convictions, and anything else they should know.
A durable financial power of attorney will allow your named agent to make financial decisions and conduct business on your behalf if you cannot handle these matters for yourself. For example, you could authorize someone to run your business for you, or you could simply authorize a person to write checks and pay your bills on your behalf.
- Note: If you do not name trusted individuals to act for you in medical and financial powers of attorney, your family members, including your spouse under some circumstances, will have to go to court to be appointed to this role. The person appointed by the court may not be the person you would have chosen.
Advance Directive/Living Will
Your advance directive, also known as a living will, is a document that spells out your wishes for the end of your life, for example, whether or not you want to be placed on life support if you are in a vegetative state or have a terminal condition.
You can use a memorial and services memorandum to share your wishes for your service, people who should be notified when you pass away, instructions regarding your remains, and information you would like to be included in your obituary. If you do not provide this information in advance, your grieving family will be left to guess about what you would have wanted. This could lead to unnecessary stress and conflict at a time when they are likely to be feeling emotionally overwrought.
Contact Us Today
Certain situations can bring our own mortality to the forefront of our minds, and the coronavirus provides a reminder of how important it is to have an estate plan in place in case the unexpected happens. Our foremost goal is to assure you that if you become ill, your own care and the needs of your family will be addressed. Contact us today to set up a meeting.