Incapacity planning requires valid power of attorney documents.
Being picky is not always a bad thing.
Purchasing expired groceries can lead to illness.
Settling on a mate can lead to a lifetime of conflict and insecurity.
According to a recent Medical Economics article titled “Avoid powers of attorney mistakes,” granting power of attorney authority to the wrong people can endanger you and your finances.
You should carefully consider who you appoint as your financial attorney in fact and as your healthcare agent.
Although attorney in fact has a fiduciary duty to act in the your best interest financially, some people may act contrary to this responsibility due to selfish reasons or mere incompetence.
The person you select should be someone who has proven to be trustworthy and unselfish.
This individual must be capable and responsible, too.
While some people may choose to designate their spouses because they believe them to be trustworthy, that spouse may have good intentions, but be incapable of managing money or staying organized.
If this describes your spouse or if your spouse and you do not get along, it may be wise to look elsewhere for a financial attorney in fact.
When the scope of authority under your general durable power of attorney is broad, your attorney in fact could potentially change many key aspects of your estate plan.
This person may mess up your investments, steal your money, or change your beneficiary designations.
Selecting a trustworthy person to serve as your healthcare agent is also essential.
This could be the difference between a high or low quality of life and care.
No, actually this could literally be a matter of life and death – yours!
For example, the healthcare agent may choose to select the cheapest options for your medical needs to preserve an inheritance if this person is also the beneficiary.
A nefarious agent may also fail to take you to appointments to hasten your demise.
Even if your agent has good intentions, incompetence can lead to subpar care.
What can you do to guard against poor incapacity planning?
The best thing to do is to work with an experienced estate planning attorney.
Although you may be able to find cheap (or even free) general durable power of attorney and advance health care treatment directive documents online, these are often insufficient to really protect your wishes.
You can be more specific regarding your wishes and the limitations on authority without a DIY document.
Be cautious if a family member simply asks you to sign documents without explaining them.
You should be involved in selecting these essential legal documents tailored to meet your needs.
As you choose your attorney in fact and your agent, you should take into account their strengths and weaknesses.
Is one child really good a finances and the other in the medical field?
You may want to divide authority between these responsibilities.
Are your children trustworthy and do they get along well?
You may be able to make them co-agents.
Discuss your goals and wishes with an experienced estate planning attorney who will be able to draft just the right legal documents for your unique circumstances.
Reference: Medical Economics (Feb. 3, 2022) “Avoid powers of attorney mistakes”