LOSING CONTROL IS YOUR GREATEST THREAT

Many people wonder what Estate Planning is and why you need to do it. Simply stated, Estate Planning ensures you maintain control of your property as long as you are able and when you are no longer able, those you trust are able to act on your behalf with full instructions by you.

There are two forms of losing control. First is the loss of control of your financial assets. If you become incapacitated, your assets may be inaccessible by your loved ones unless other legal measures had been taken to authorize someone to act. Bank accounts, stocks, bonds, IRAs, and the like are not automatically accessible by your loved ones. Not even your spouse! To ensure control is maintained, the most common Estate Planning tool is a Power of Attorney. A Power of Attorney grants authority to someone else to act on your behalf. What most people do not appreciate is a Power of Attorney is valid when signed. Therefore, once signed, the person you appoint can access your accounts, or dispose of your assets, with or without your consent. You can execute a statutory Power of Attorney or create a personalized one.

Most all lawyers use the state statutory form which was created by the state and grants general powers the state deems necessary to act for someone who cannot act for themselves. The challenge is whether the statutory form is sufficient. For example, the statutory form does not grant permission to access safe deposit boxes, change beneficiaries on jointly owned accounts, nor even to create trusts. These powers, and others not authorized, can be absolutely essential if asset protection or Medicaid eligibility is desired, if you become incapacitated.

To ensure your agent (appointee) has all the powers required to address your concerns, you should discuss your goals with a qualified estate planning attorney to create personalized Power of Attorney which can grant all authority and also provide the guidelines on when and how to use it. Some individuals also consider execution of a “Springing Power of Attorney”. A Springing Power of Attorney is signed now, but becomes valid upon the “happening of an event”. The challenge is proving the “event” has occurred to the satisfaction of financial institutions or others that are asked to honor it. They need to be sure the conditions have been met or they can be personally liable.

Another serious form of loss of control is with your medical decisions. Should you become incapacitated and decisions have to be made on your health, no one will be able to make decisions for you without proper legal documents. As a result, those decisions could be left to the medical professionals or courts. Do you remember the Terri Schiavo case? That is a perfect example of failure to have proper healthcare directives in place.
Health Care directives consist of a Health Care Proxy and/or a Living Will. A Health Care Proxy is a document in which you grant legal authority to someone to make your health care decisions for you if you are unable. The short fall of most Heath Care Proxies is they grant the individual you appoint the authority to make decisions on your behalf, but rarely provide any guidelines for them to follow. This can be lifelong wonder to the person you appoint whether they feel they made the “right” decision that resulted in you passing.

A Living Will, conversely, can provide written instructions for your health care agent to follow. Most standard Living Wills, however, only deal with life and death issues and fail to address care issues when death is not imminent. Ensure you get the proper guidance on creating your health care directives since it is likely to determine if you will live or die in an unanticipated situation.

Maintaining control at all times is a critical element of a proper estate plan. Ensuring you have proper Power of Attorney and Healthcare Directive is absolutely essential to maintaining control with the people you choose (and not the State, or the Courts) should something happen to you. contact www.mpssuccess.com to learn how to make certain your clients maintain control at all times.