Transition Planning: Power of Attorney Documents
- Katie Samples Dean, JD
- Oct 25, 2019
- 5 min read
Every single adult needs a Power of Attorney. Every. Single. Adult. Even if you don’t have kids, even if you don’t own a house, even if you don’t want to; you need a Power of Attorney.
Now a little bit more clarification, there are two different Power of Attorney documents in most states. A Durable Power of Attorney and a Healthcare Power of Attorney or Living Will, depending on the state. Also, before we dive too far into these documents, an adult is someone 18 years old or older in all states but Alabama (19 years old), Mississippi (21 years old), and of course, Nebraska (19 years old).
A Durable Power of Attorney or Power of Attorney is a document that gives another adult, that you name, the power and ability to act on your behalf in basically all decisions, but health care. This includes real estate, personal property, stocks, commodities, insurance, and almost all legal decisions. In some states, you can grant specific authority to do things such as change your trust, will, gifts, and other things.
CAUTION: the Durable Power of Attorney can grant authority to the Attorney in Fact or Agent (the person that you name) while you are still alive and can work while you are still capacitated and have the ability to make the decisions as well. Sometimes this is something that we want to use, but only in limited circumstances. An example would be if I took month-long vacations to Hawaii every year and Scott was trying to sell our farm, I would give him a specific Durable Power of Attorney to deed that piece of real estate, while I was in Hawaii. (Side note: I do NOT take month-long vacations anywhere, and I have only been to Hawaii in my dreams).
If you do not fill one of these out, then your family will need to get a Conservatorship or Guardianship in order to be able to make these decisions for you. These are terrible court proceedings that end up costing the family money and causing them to need therapy. So if anything, fill this out as a gift to your family to avoid this.
Normally we draft these so that they only come into being if you are deemed incapacitated by your medical provider. The typical time in life that these are used, especially anymore, is if someone has dementia or a stroke later in life, and we need to manage their assets because their spouse has passed already. It is a great tool at this time because the Attorney-in-Fact can sell their house to pay for long-term care, write checks to pay bills and just manage their lives without too much hassle.
A Healthcare Power of Attorney or Living Will is a document that grants the decision-making power to an adult for your medical and health care decisions. This is only if you are deemed incapacitated by your healthcare provider. There are other documents that hospitals and care facilities have you fill out, but they do not have the same legal authority as the Power of Attorney document for your state. This is an issue if for some reason there is a family member or close friend that decides to challenge the document in court, usually only the true Power of Attorney or Living Will, will stand in court.
If you do not have a Healthcare Power of Attorney, then your family will have to make decisions based on state law. In the states I am familiar with, that is some mix of a family consensus or hierarchy beginning with spouse. This can sometimes be an issue if these people cannot get along, or do not want to go along with your wishes. If they cannot get along and one files for a Guardianship, it will be a court battle to decide who gets to make the choices, and let me just tell you, judges are not the right person to make this decision, YOU ARE.
Putting your healthcare wishes in writing provides your family with a level of comfort and assistance in one of the toughest times of their lives. Whether it is a spouse, parents, kids, grandkids or just friends, the document gives them a list of what you want and a person that is in charge. It is always better to have one zookeeper named to tame the monkeys instead of lots of zookeepers and no monkeys!
THIS IS IMPORTANT FOR ANY AGE! We think of this document as something for older adults, but it is actually just as helpful for young adults. A perfect example of this was a family friend of ours that was in a car accident, resulting in him being in a coma for roughly one month. He was over the age of 18 in Colorado, which meant his mom was not his guardian. He had nobody named to make decisions or be able to do certain things. In this situation naming a parent would have been great, and once he was conscious and able, he would have been in charge again.
The Power of Attorney documents, in any state, cease to exist at your death. What that means is once you pass away, we will use other documents to govern the administration of your property and your healthcare will no longer be an issue.
We also recommend that you take time to discuss with the person you are naming as your attorney-in-fact that you are naming them, and what your wishes in the different situations might be. Even if you do not have the wishes for a very specific health situation written down, if you have had a healthy discussion with the attorney-in-fact they should be able to use their critical thinking skills and make the right choice.
If you are young, sign these now, then plan to sign another set later in life. If you are going to sign either of these, please, please, please, be careful in who you choose. The person you pick for either of these is SO important. Make sure that it is someone that can handle making decisions in tough emotional situations and on a tight timeline. It should NOT just be your oldest son, or spouse, if they are not well-suited for these situations. The person named in the Durable Power of Attorney will need to manage your property and make bigger decisions. The person named in the Healthcare Power of Attorney will be in an emotionally tumultuous situation, and you want them to carry out YOUR wishes, not the wishes of everyone else.
In Nebraska, you can download free copies of this from the Nebraska Supreme Court website at https://supremecourt.nebraska.gov/self-help/financial-medical/power-attorney. In other states, and even in Nebraska, contact your local attorney to get both of these done.
Let’s set a goal that you get it done during 2019! CALL, EMAIL, OR TEXT ME to set up an appointment to get yours done!
Disclaimer: This information is only specific and accurate for the states of Nebraska and Colorado. This information is intended as a general legal foundation and not specific legal advice. SD Law is not responsible for decisions and actions made relying on this document without a specific legal consultation and does not represent you as a result of this post.
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