Life Planning Documents

Most often associate “estate planning” with death. Specifically, what happens to assets after death. However, there are a few documents that are effective while you are living. In fact, they are only effective while you are living so that as soon as you die, they do too. These documents are used when you are physically incapable or unavailable to make decisions on your own. Since statistically speaking, you have more of a chance of becoming incapacitated than dying, these life planning tools are essential for everyone to have. 

Durable Power of Attorney

Without a signed Power of Attorney, if something does happen to you and your financial or business affairs need attention, someone will have to go to Court to ask permission to carry out the task. (Whenever you hear “Court,” immediately think time, money and aggravation, with all due respect to the Courts.)

Without a signed Power of Attorney, if something does happen to you and your financial or business affairs need attention, someone will have to go to Court to ask permission to carry out the task. (Whenever you hear “Court,” immediately think time, money and aggravation, with all due respect to the Courts.)

A Power of Attorney is a legal document that gives one or more of your favorite “good with money” people authority to manage your finances, like real estate, business affairs and bank accounts, if you are unable to do so — maybe because you are out of the country, or maybe because you have lost capacity. You, as the person who signs the Power of Attorney document, are called the Principal. The person who receives the authority is called an Agent or Attorney-in-Fact. Your Agent will not become owner of the assets, but only able to manage them on your behalf. That could be paying bills, continuing your banking or signing legal documents. Your agent can’t just take your checkbook to the mall for their own personal wardrobe upgrade. They do have a fiduciary duty (meaning an obligation to manage your money to the best of your interest). Also, you can make this document as broad or limited in authority as you feel comfortable.  

This instrument is particularly useful for a young adult who is away at college and may not be able to manage his or her affairs at home, such as file his or her own taxes. And without this document, the school administration may not release academic records or transcripts to the parents of the student because even though mom and dad may be paying the tuition, the school contract is between the university and the child.

Without a signed Power of Attorney, if something does happen to you and your financial or business affairs need attention, someone will have to go to Court to ask permission to carry out the task.  (Whenever you hear “Court,” immediately think time, money and aggravation, with all due respect to the Courts.)  

Health Care Proxy

This document is like the above, only with respect to health care decisions. The Health Care Proxy is a legal instrument where you identify another who you entrust to make health care decisions for you if, for any reason and at any time, you do not have the wherewithal to make or communicate those decisions. And like the above, without this document, if you are severely injured in an accident for example (or losing your marbles) your family may have to go to Court to obtain proper authority to authorize medical treatment on your behalf. Again, Court equals time, money and aggravation.

Living Will

This one is big, and truthfully, I have had clients chose not to sign it. Not to be confused with a Last Will and Testament, this is the document where you basically provide instruction to pull the plug, per se. It identifies your wishes about certain kinds of medical treatments and life-prolonging procedures and may state that you do not want to be put on life support if your health condition is so awful that there is no reasonable expectation that you would come back to live a life of any quality. Technically, this document isn’t even effective in Massachusetts, but it does provide clearer direction to your health care proxy if he or she ever must make such a gigantic decision. 

Contact us today, and we’ll walk you step-by-step through the different life planning documents and help you with your other legal and financial decisions to ensure your family is planned for and protected no matter what happens.

This article is a service of 20West Legal, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session, ™ during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge