You should always keep your estate planning documents updated, not just because of the Coronavirus. The Coronavirus just reminds us of our mortality, and the importance of the documents that you need for financial, health care, and end of life matters. You need a minimum of four documents for an effective estate plan. Those four documents are:
Your will. Your will is the legal document that determines how your estate is to be divided after you die. One reason to update your will is to provide for your minor children. Is the person you designated as the guardian in your will 10 years ago still the best person to finish raising your children should something happen today? As my wife and I raised our children, we changed this designation multiple times as situations and circumstances around us changed. Fortunately, we never had to use any of the people we designated in our wills, but we rested better knowing we had planned appropriately.
Your living will. Your living will is your instruction to your doctor about what to do at the end of your life. A living will does not give the person you designate the power to “pull the plug,” or terminate your life. That decision is left up to you, as directed to your health care provider per your instructions in the document, and only then if further care would not provide comfort to you, or a chance of recovery. You designate a person within your living will to be contacted at the end of life, not to make the decision about what to do, but to be notified so that the family can gather, make plans, and say goodbye to a loved one.
Your health care power of attorney. This document allows you to designate the person who has authority to make health care decisions for you, when you are not able. If you are in an accident or have a health crisis that prevents you from communicating with your health care providers directly, it is important that you have someone that you trust to make important health care decisions on your behalf. The person you designate may not make health care decisions that are contrary to your desires for so long as you can make your own decisions.
Your durable general power of attorney. Your Durable POA allows the person you designate to make financial decisions on your behalf. I tell people that this is the single most powerful document that you will ever sign, because it gives the person you designate the power to do anything that you can do legally. I advise people that this document is to be kept in a safe place, but not given to the person you designate. I recommend an inexpensive, but lockable fireproof box that you keep under your bed, or a designated location in your home. The reason for not turning over the power of attorney document to the person you designate is due to the risk of the document being abused. It’s imperative that you trust the person you designate inherently, as a power of attorney allows the person you designate to withdraw money from your accounts, sell assets, and dispose of the assets as they deem necessary.
The Coronavirus has raised our awareness of the need for estate planning, but it should not be the reason we do it in the year 2020, and then forgotten for the next decade. Your estate plan should be reviewed annually for accuracy, and if changes are not necessary, do nothing. However, if you find that changes are needed, work with an attorney. Make certain that your wishes are accurately reflected and understood within your documents, and that the right people are designated, and notified to handle your situation.