COVID-19 has us all thinking differently. At the beginning of the year we were going about our day-to-day lives and now the focus has completely shifted to our health, financial and mental well-being. We have been confronted with the question, “What would happen if I got sick or died – do I have a plan?”
The current environment has highlighted how crucial it is to have a plan if you are sick and incapacitated. I strongly advise you have current advanced healthcare directives in place and current (updated Healthcare Power of Attorney and Living Will). The Healthcare Power of Attorney appointments someone to make healthcare decisions on your behalf if you are incapacitated and unable to make your own healthcare decisions. The Living Will is a document that communicates your wishes in the event you are only being kept alive by machines. If you or a family member are hospitalized, most healthcare professionals will ask for these documents.
A financial Power of Attorney can also prove to be a crucial document if you are sick and incapacitated. This is a document that appoints someone to handle your financial affairs on your behalf. If you are sick and incapacitated, someone will need to continue to pay your bills and make financial decisions on your behalf. This document allows you to appoint who will be that person to act on your behalf.
If you are sick and incapacitated and have not appointed agents to help make these health and financial decisions, the Probate Court may need to appoint a Guardian to act on your behalf. This procedure can be cumbersome, time-consuming, and expensive. In addition, you will not be the one to choose who should act in that role (as you would choose if you appoint powers of attorney).
The current environment also highlights how crucial it is to have an estate plan in place for when you die. If you have minor children, your Last Will and Testament directs who will be their guardian upon your death. Your Last Will and Testament, Trust, and/or beneficiary designations can all dictate what happens to your assets when you die. A comprehensive estate plan will use these post-death administration tools to distribute assets as efficiently as possible and will address how to avoid the probate administration.
It is also crucial to do the following things to make life easier for loved ones in the event of an illness or untimely death:
• Make a list of all your assets including bank accounts, investment accounts, retirement accounts, life insurance policies, annuities, digital assets, etc (the amount of time people spend determining what their loved ones owned is staggering, all because no one took the time to make a comprehensive list).
• Tell your loved ones where they can find this asset list, as well as the necessary passwords to access such assets – which can be stored separately for security purposes.
• Evaluate, from a financial perspective, what life would look like for a surviving spouse or children in the event of an untimely death (will your survivors’ current standard of living be drastically altered as a result of your death?).
• Think about and actually convey your desires to your closest loved ones, regarding medical treatments and end of life decisions. You have no idea the gift you are giving by making your wishes known so they can avoid future uncertainty in what will inevitably be some of their most difficult moments.
We have all found ourselves in a very different environment. Now is the time to address these issues and get a plan in place that accomplishes your goals and makes life easier for your loved ones.
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