Very often a client will ask me what types of powers of attorney should I have in place when I do my estate planning? We normally would recommend at least six types of powers of attorney when we are doing estate planning for our clients.
Now, the first power of attorney that we recommend is a statutory durable power of attorney for financial transactions and this is the power of attorney that enables the person or persons of the client’s choice to handle financial transactions in the event that they cannot. Now, the power of attorney will have options. It can go into effect immediately or be effective only on incapacity. It can have broad gift giving power and low giving power, so the specifics of the power of attorney for financial transactions will of course be discussed one on one with the attorney who’s preparing the documents.
Number two, we like the clients to also have a medical power of attorney for medical decisions. Unlike the financial power of attorney where the client will have the choice of making the power of attorney effective immediately or upon incapacity, the medical power of attorney only goes into effect upon incapacity, and that is the inability to make decisions. Again, who will make medical decisions for you when you cannot? In conjunction with the medical power of attorney, we always like to see a current living will or what we call a declaration or an advanced directive to family members or doctors where the client could make their own decisions about life support when they get to the end of their life. Again, they’ll have options on the living will to either select life-support to be continued or not continued and other specifics.
We also like the client to have a release of medical records form called the HIPAA authorization. Our clients will normally sign HIPAA authorizations for medical providers when they have services provided by them, but an independent HIPAA authorization form that covers all medical providers from the date of birth forward may be advisable as well.
We also like our clients to have an interesting document called a declaration of guardian. Now, if clients have powers of attorney, trust, or other estate planning tools, they may not necessarily need a guardianship, but if some other entity or person other than their named fiduciaries – their named powers of attorney – try to come forward and establish themselves as guardians, then this document will be the document that will be presented to the court and the court will then, in most circumstances appoint the named individuals that the client has inserted onto the declaration of guardians. That’s a very important document.
Lastly, we like our clients to have a document called appointment of agent for disposition of remains and this is a document that allows the client to appoint one or more persons to handle funeral arrangements. Very often, we’ll have clients who don’t have children. There’s no one out there to handle their funeral arrangements so this will enable them to name somebody. Sometimes we have children all over the country and they’re not readily available at the time of death to authorize the disposition of remains to the funeral home, so this will enable them to name one local child or other person to do that. Sometimes we’ve had cases where there’s been conflict in families about how to handle things. Of course, the most famous case is the Ted Williams case – the famous baseball player. His family argued for more than a year whether he should be cryogenically preserved or buried. I don’t remember how that turned out, but they delayed the funeral for quite a while. We’ve had cases where three children argued about which church to have the funeral in. Unfortunately, that delayed the funeral for quite an extended period. Also, people will often choose to have funeral arrangements that differ than what their families would choose so they’ll name another person to make sure that their wishes are carried out.
These are the documents that we find helpful to all of our clients regardless of how they set up their estate plan – the statutory durable power of attorney, the medical power of attorney, the living will – or directive to decisions and family members as it’s often called – a HIPAA authorization, a declaration of guardian, and an appointment of agent for disposition of remains.