Many people believe that estate planning involves planning for what will happen after death. This is not wrong. However, a complete estate plan should also plan for what you would like to happen if something renders you incapacitated. Consider using an advance health care directive to address possible medical needs and a durable financial power of attorney to address possible financial needs.
Advance health care directive
An advance health care directive is a legal document that you can use to make known your wishes for or against specific types of medical care. This may include your preference regarding feeding tubes, breathing machines, pain medication or organ donations. You can also specify what doctor you prefer or address possible treatments you may face in connection to an ongoing illness.
Although you can address many possible situations in writing, you can also use an advance health care directive to appoint someone to make medical decisions on your behalf. This person, called an agent, can make decisions for you in situations you did not account for in writing. Typically, your agent only has the power to make medical decisions for you when you are unable to make them yourself, but you can allow your agent to speak on your behalf at any time.
Durable financial power of attorney
A durable financial power of attorney is a legal document that allows you to name an alternate decision-maker for financial matters. This alternate decision-maker, called your attorney-in-fact, can manage financial matters for you while you are unable to do so yourself. Some of these matters may include completing bank transactions, paying bills, filing tax returns and signing contracts.
Typically, people choose trusted family members to serve as health care agents and attorneys-in-fact. However, it is important to consider family dynamics when deciding which people to appoint because disagreements between your health care agent and your attorney-in-fact could result in delayed payments for medical bills, which may impact the type of medical care you receive.
Unfortunately, unexpected accidents happen every day, and there is no way to know what the future holds. However, with the right documents, you can have peace of mind knowing that your medical care and finances will be managed in the way you wish.
