Don’t procrastinate in estate planning

Posted: Monday, December 1, 2008
Dan often preaches the gospel of anti-procrastination. For more than three years now, we have reasoned with our readers to get their financial house in order sooner rather than later. No one, including us, likes to think about leaving this planet anytime soon, but only a true ostrich thinker will not, at one time or another, realize in the immortal words of songwriter Larry Norman, “I’m only visiting this planet.”

Unfortunately, when it comes to estate planning (i.e. setting up or updating a will or a trust), delays can potentially have truly devastating consequences to your heirs. With that in mind, let’s go to this month’s question.

Q: My husband was recently diagnosed with Alzheimer’s disease. He cannot make decisions for himself. I am now being told that I cannot make decisions for him either, unless I have specific legal documents. Help, please! What documents do I need and how do I find someone to guide me through this maze?

A: The situation you find yourself in is, unfortunately, very common. People just don’t like to deal with issues surrounding infirmity and death, even though they are as inevitable as birth and breathing. To avoid the complications mentioned, one should have the following documents in place before you or your spouse needs them. First, a Durable Power of Attorney allows you to act for your spouse who is incapacitated and unable to act for him or herself. This power can be used to pay bills and withdraw money from an individual account, such as a pension plan.

You’ll also need an Appointment of Heath Care Agent. This appoints a person or persons to make medical decisions on your behalf should you be unable to make them.

Next, you will need a Health Care Directive. This document directs the doctor to follow your wishes should you not be able to do so through a pre-set direction form. For instance, Dan has directed that should he be terminal and unable to make decisions, the doctors should turn off the machines and give him all the drugs the world has to offer.

Finally, everyone should have either a Will or Living Trust. We have discussed these documents in depth in previous articles.

Unfortunately, because you did not have these documents in place before your husband’s illness, you may have to go to court and have the court appoint a legal guardian (hopefully, you) to make decisions for him. If you had acted before now, that would not have been needed.

In conclusion, although many of the documents we discussed are available online, we strongly suggest you have them set up by a qualified estate attorney who is licensed in your state. These documents are much too important to leave to chance. Furthermore, this is also not a good time to go for the cheapest price. Ask around, find a qualified person, and pay them. They are worth it. Until next time, remember, your money matters.

Dan Searles, CFP, is a financial planner and a Registered Representative offering securities and advisory services through National Planning Corporation, member FINRA/SIPC, and a Registered Investment Adviser. Medallion Financial Group and NPC are separate and unrelated companies.

National Planning Corporation does not endorse the opinions expressed in this column. The information here is not to be considered as financial, tax or legal advice. As with any financial, tax or legal matter, consult your qualified adviser before taking action. No investment strategy can ensure a profit or protect against a loss. As always, past performance is not indicative of future results.

Categories: Money Matters

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