Katherine’s parents are 80 years old, and she’s taking on more and more caretaking duties for them. Besides looking after their physical well-being, she’s becoming more involved in managing their financial affairs. What are some things she should pay attention to?
If her parents do not yet have an estate plan, or at minimum a will and powers of attorney (financial and healthcare), Katherine needs to help them get this done. Assuming they designate Katherine as power of attorney, she’ll then be able make decisions on their behalf should they become incapacitated.
Katherine should also ask them to list their financial information and contacts. The list should include all accounts and account numbers, the usernames, passwords, and the location of all important documents, including tax filings. Don’t forget to include their Medicare, Social Security, and driver’s license numbers. Also, she needs to know how insurance premiums and other bills are paid.
Client Profile is based on a hypothetical situation. The solutions discussed may or may not be appropriate for you.
Three legal documents — a will, powers of attorney and an advance directive — are essential elements in an overall strategy to protect the ones you love, providing a measure of certainty when you can’t. An estate planning attorney can help you create and update these legal documents.
A will is the one document most people need, even when they don’t have great wealth. A will can direct how your assets are distributed and provide crucial instructions for taking care of minor and special-needs children. It can provide basic information such as the names of potential guardians and directions for distributing assets to care for those left behind.
POWERS OF ATTORNEY
Financial powers of attorney name a person who will handle your financial affairs if you can’t. Two common types of these assignments are limited and durable powers of attorney. Singular events, such as an absence when signing a legal document is required, might activate limited powers. Durable powers of attorney typically go into effect when people are incapacitated and can’t make financial decisions for themselves.
When you can’t make healthcare decisions for yourself, an advance directive can provide general guidance. For instance, you may not want resuscitation or ventilator assistance if you are nearing end of life or have suffered significant brain damage. Alternatively, you can assign healthcare, or medical, powers of attorney to individuals who would make these decisions for you.
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