Summer 2021 Newsletter

PROTECTING WHAT’S YOURS (WHILE YOU’RE ALIVE)

Whether due to disability, dementia, or simply enjoying an exotic vacation, there are many ways you can end up unavailable to make critical financial or health care choices for yourself or your loved ones. If you’ve not documented your desires in advance, it can add extra stress for everyone, plus the outcomes may not be what anyone had in mind!

One source of confusion over when and how to protect what’s yours is understanding which legal logistics apply during your lifetime, and which don’t come into play until after you pass.

Today, we’ll cover a couple of tools for protecting your interests while you are alive:

1. A financial power of attorney
2. A healthcare advance directive

I. A Financial Power of Attorney

The Basics. A financial power of attorney (POA) is a legal document authorizing someone (your “agent”) to make financial decisions on your behalf. No matter how much authority you grant an agent, they still owe you a fiduciary level of care, which means any decisions they make for you must be based on what they believe to be in your best financial interests.

When It Applies. A POA applies while you are alive, but unavailable to act for yourself. You can structure it to:

• Begin immediately or upon a triggering event (such as a debilitating accident or illness)
• Remain in force during a finite time period or be ongoing
• Apply to all your financial matters, or only to specific transactions

Common Scenarios. A financial POA can be helpful to address:

• Capacity: If you become incapacitated due to illness, injury or dementia.
• Availability: If you’re unable to be present for a financial transaction, such as if you’re traveling abroad or you’re otherwise preoccupied.
• Convenience: If you’d simply like to make it convenient for someone else to be able to make financial decisions for you – such as your spouse or a trusted sibling (in general), your parents (if you’re heading off to college), or your adult children (if you’re aging).

Additional Tips.

• Again, anyone to whom you grant a POA is only your legal agent while you are alive; their authority ends the moment you pass away. Your estate’s trustees should take it from there.
• Your agent(s) should have access to the documents that describe the POA you’ve granted them. If they can’t prove what their role is, they may not be able to act on it when needed.
• Some banks and account custodians have their own POA forms they would prefer you use; also, they may be wary of POA paperwork that is several years old. Check with the financial institutions you frequent about their policies, and consider annually reestablishing any durable POAs, to ensure they remain relevant.
• You cannot grant a POA if you are deemed to be of unsound mind. This makes sense, since you may inadvertently name a “bad” player … or others may be able to contest the POA you’ve established. Don’t wait until it’s too late.

II. A Healthcare Advance Directive

The Basics. Your healthcare advance directive can offer two types of protection:

• Your living will provides your life-sustaining and end-of-life medical care instructions, and related healthcare preferences, in case a time comes when you cannot state them for yourself.
• Your healthcare directive can also name healthcare representative(s), or agent(s) and grant them healthcare power of attorney. If you cannot make your own healthcare decisions, your agent can decide on your behalf, guided by your living will. Medical professionals can also more freely discuss your condition with your agent, without violating HIPAA privacy rules.

When It Applies. Your healthcare advance directive only comes into play if you are alive, but unable to direct your own medical care.

Common Scenarios. Accidents and illnesses can rob you of your mental capacity – temporarily or permanently. If you do not have an advance directive in place, healthcare professionals and/or key family members may have to make medical decisions for you, without knowing what you would have preferred. Also, the individual(s) you would most want to have making decisions on your behalf may not be able to do so if you haven’t named them as your representative(s) in your advance directive. This can be stressful if not heartbreaking for everyone involved.

Additional Tips.

• Not only should almost everyone have an advance directive, it should be easy to get ahold of it when needed. Distribute copies to your primary physician and any of your other healthcare providers to keep on file. Give it to key family members.
• IMPORTANT: Do you have children who recently turned 18? As soon as your child is an adult, healthcare providers may not be able to even discuss your child’s case with you unless you have a healthcare power of attorney. Also, if your child is attending school in another state, it’s worth establishing a healthcare power of attorney in their state and yours.

How Can We Help?

We hope our handy summary has helped clarify the role these critical protections can play in safeguarding what’s yours during what we hope will be a long and prosperous lifetime. That said, professional legal counsel is usually warranted as you sort through the details. Let us know if we can help you sort through the logistics involved. That’s what we’re here for!

Copyright © 2019, Wendy J. Cook Communications, LLC

PROTECTING WHAT’S YOURS (AFTER YOU PASS): THE IMPORTANCE OF ESTATE PLANNING

Fact: When you pass, you will leave behind an estate, and somebody will need to settle it. Your estate may be worth a little or a lot, but there’s no escaping death and taxes.

So why do so many families put off their essential estate planning until push comes to shove?

Estate Planning Is an Act of Love

Since 2015, Caring.com has been conducting a periodic survey of Americans’ estate planning habits. Its most recent results suggest the pandemic has spurred an uptick in estate planning, especially among younger adults. That’s good news. But still, an enormous divide remains:

Some 60% of those surveyed agreed it’s important to have a will.
But, as of December 2020, only about a third of them actually had one.

Among those without a will, the top reason cited across multiple years remained the same:

“I haven’t gotten around to it.”

This isn’t surprising, given the logistical and emotional stumbling blocks involved. Plus, most families are plenty busy with interests that seem more immediate … right up until they’re not.

The Upsides of Estate Planning

In short, if you’ve been procrastinating on your estate planning, you’re not alone. But regardless of your age or net worth, let’s correct that oversight today, because …

By reducing their stress load during an already stressful time,

a well-structured estate plan is the greatest gift you can bequeath to your loved ones.

According to a 2018 EstateExec survey, it typically takes just under 700 hours to settle an estate valued between $1–$5 million. Every painful task and each extra hour you can take care of in advance will be one more way you can give back to the loved ones you leave behind, granting them the space they’ll need to grieve and process the emotional toll of their loss.

Estate planning also brings important practical advantages to nearly every family:

Clarity: Your actual wishes are far more likely to be realized if you’ve written them down and made them legally binding.

Speed: Your estate is likely to settle far more quickly, with less red tape and fewer frustrating delays before your beneficiaries receive their inheritance as hoped for.

Cost Savings: Faster settlements usually translate to fewer costs.

Tax Benefits: Estate planning can include basic and advanced strategies for facilitating a more tax-efficient wealth transfer.

Protection: By addressing potential problems in advance, distributions are less likely to end up in the wrong hands, such as estranged family members or debt collectors.  I am not sure how the State where you live deals with minor children left behind where both parents are deceased, but in some states a verbal directive does not work.  Those States would most likely require a written directive included in your Will to designate who you want to care for your children in the event that you both become deceased.   In such circumstances where there is no written directive, your children could become wards of the State.  It is doubtful that such an option for you minor children’s care would be favorable to you.

Step-by-Step Planning

So, what’s stopping you from getting a grip on your estate planning? There are three common hurdles that stand between you and your effective estate planning. These include: (1) deciding who gets what, (2) making it legal, and (3) getting (and remaining) organized. Don’t let these hurdles stop you from doing something so important.

Copyright © 2021, Wendy J. Cook Communications, LLC

PLANTING THE SEEDS

Spring is finally here. The trees are budding out, and the flowers have poked through the ground and some are even blooming. Farmers are busy preparing the soil and beginning to plant their crops. If you are a gardener, you are either getting ready to plant your garden or will be in the near future.

In this newsletter, we are planting some seeds for thought for you to give careful consideration. We have included an article about protecting what is yours while you are alive and an article about protecting what is yours when you pass away. It is easy to procrastinate about doing any planning for either situation, but if you have not done anything in either regards, you should consider doing something sooner rather than later.

After spending some time waiting in the ICU (Intensive Care Unit) waiting room of our local hospital, I witnessed a family unable to conduct any business for their husband and father who was a patient in the ICU and was unable to do anything himself. The stress of the situation was enormous. It was later discovered that the patient at some point had named his wife as having Power of Attorney for him, and that was a turning point in reducing the stress on that family.

Similarly, after speaking to a group of people about the need for planning and the need for having a will, a woman told me that she personally knew about the need and importance about naming someone to take care of the children after the death of both parents. You see, she had been one of those children who became a “ward of the state” when her parents died, and she had been separated from her siblings for several years due to the neglect of having a written directive in place.

No one would intentionally make it any more difficult for their family during stressful times. We have now sown the seeds, and hope that you take the time to plan for your future and the future of your family. Much like the seeds planted in your garden, we hope that they come to fruition. Please let us know if you have any questions or need any guidance. We are here to help.

Investments provided through Wealth Management LLC, a Nebraska LLC, Registered Investment Advisor.
This material is derived from sources believed to be reliable, but its accuracy and the opinions based thereon are not assured.
The articles and opinions in this publication are for general information only and are not intended to serve as specific financial, accounting or tax advice.