Parents may overlook the importance of drafting a Will or considering an estate plan. However, it is critical for young parents to plan in the event something should happen to them. Would you want your child’s future determined by a Court? Do you want your assets divided by State law rather than your own preferences? Estate Planning allows a person to self-determine critical decisions. When estate planning it is important to consider having the following documents:
Last Will and Testament
Every adult should consider drafting a Last Will and Testament. A Will allows a person to self-determine how assets should be divided upon ones death. In addition, it allows a person to place strings on the money to be distributed. For example, if you have children and you do not want a child inheriting a large sum of money upon achieving adulthood (typically 18), you can place the money in Trust and direct the Trustee to distribute the money at certain intervals (i.e. 25% at age 18, 25% at age 25 and the rest at age 30). It is also beneficial to have a Will so you can determine for yourself who you would want to serve as your Executor, the person in charge of distributing any Estate assets and paying any necessary Estate taxes.
As it relates to families, a Will is also where you would set forth who you would want to serve as Guardians of your children should something happen to you. Determining Guardians is a critical decision and you want to make sure you have spoken to your designated person or persons in order to confirm their willingness to serve in the position.
Power of Attorney
A Power of Attorney is a document that gives designated authority to a third-party. The document can be effective immediately or upon a certain contingency taking place, such as if you become incapacitated. Without a Power of Attorney, no-one would be legally authorized to make decisions on your behalf if you are unable to make decisions for yourself, unless a costly and time-consuming guardianship application is filed. To avoid that scenario, a Power of Attorney should be drafted to allow a designated third-party power to act on your behalf.
Living Will and Health Care Proxy
A Power of Attorney typically covers financial and legal matters rather than medical issues. In order to authorize someone to make medical decisions for you when you cannot make them for yourself, you need a Health Care Proxy. It should go without saying that the person designated in the Proxy should be someone you trust and you should have a conversation with that person about your preferences regarding treatment alternatives. In addition to a Health Care Proxy, it is important to have a documented living will. A living will provides instructions regarding your end of life care. Would you want to be kept alive on a ventilator or would you prefer to forgo life sustaining treatment if considered brain dead? A document detailing your preferences may avoid family infighting and potential court battles.
Power of Attorney for Children’s Medical Care
When parents travel and leave their children with someone else, it is important to provide that caregiver a power of attorney over the children. Such a document may become necessary if a child requires medical attention and the parent is not available to make decisions for the child themselves. Without a power of attorney and with the parents otherwise unavailable, caregivers maybe left unable to properly care for the children if an emergency should arise.
In addition to having estate planning documents drafted, parents should be working with their attorneys, accountants and financial planners to ensure that their family is financially prepared should something happen to them. Among the products to consider is life insurance and short-term and long-term disability insurance. By having proper insurance in place, parents can be assured that their families will have a source of income should the unforeseen happen.
It is essential that parents plan for what if scenarios. While making such estate planning decisions is never easy, failing to make such decisions can have serious and undesirable consequences. If you have questions or want to speak with someone about your estate plan, contact one of our attorneys today.
About the author: Andrew P. Bolson, Esq. is an attorney with Meyerson, Fox, Mancinelli & Conte, P.A. in Montvale, New Jersey. Andrew’s practice focuses on commercial and estate litigation, business law, real estate law, estate planning and privacy and Internet law.