Choosing to act now and plan for your future is a “No Brainer!”
As you grow older, it makes sense to take stock of your life and consider what challenges you might face in the future and how you can prepare for them. You know what you want your future to be. By acting now, you can avoid many of the complications that come into people’s lives when they fail to plan.
Here are a few questions that you may want to consider: Who will make financial decisions for me if I become incapacitated? If I am unable to communicate, who will make my medical decisions? Who will take care of my estate and how will I pass my property on to my loved ones? Questions like these—and many more— can be resolved by getting a few documents in place.
There are two documents that authorize someone else to act on your behalf during your lifetime. A Durable Power of Attorney for Finances appoints an agent to act for you in financial matters, and a Healthcare Power of Attorney appoints an agent to make medical decisions for you if you cannot communicate. I have often seen people delay getting these documents. After they have become incapacitated, their family members want to know what they can do so that the family member can act on their behalf, i.e. pay the bills, apply for Medicaid, make healthcare decisions etc. Sadly, often there is not a lot that can be done short of applying for a Guardian or Conservator through the Court, which can be costly.
A Will or a Trust is a document that you can put in place to appoint a representative to handle your affairs after you pass away and to direct to whom you want your estate to be given to. If you die without these documents in place, the laws of the state of Idaho will determine who will be your Personal Representative and to whom your estate will go.
Here is a sampling, from my experience, of things you should think about that will avoid future problems:
- A couple can deed their home, held as community property, back to themselves as “community property with a right of survivorship”. By doing this, when one spouse dies, the home passes to the other spouse without having to probate.
- Couples who live together without getting married, need to have a Will. The law in Idaho is that if one of them dies without a Will, the other partner will inherit nothing, since they are not legally married.
- Couples who marry a second time later in life, often commingle their assets and place the new spouses’ name on the title to their property. When they do this, they make their property subject to the new spouse’s debts and creditor claims. Additionally, if a married person dies without a Will in Idaho, the surviving spouse inherits all the community property and half of the separate property. Also, the surviving spouse can claim a homestead allowance of $50,000 and an exempt property allowance of $10,000 from the estate of the deceased spouse. If these results are not the couple’s intent, or if they prefer their property to go to their children, they should sign a Prenuptial Agreement and keep their property separate.
- Many people go years without checking their insurance policies, investment accounts, IRA’s and 401K’s to make sure their Beneficiary designations are correct. Sometimes they are surprised to find that an ex-spouse or others are named as Beneficiaries that do not reflect their current wishes.
- If you have minor children, you should designate in your Will who you want to serve as the guardian of your children. If an accident, unforeseen illness or unexpected death occurs, and you have not nominated someone to serve as guardian, fighting among family members over who is to be guardian sometimes occurs, causing more stress on the already upset child. I should note that a minor, 14 years of age or older, has the legal right to object to a parental nomination of a guardian and nominate their own guardian.
In conclusion, when you are healthy and doing fine is the time you should be planning who would act for you if you unexpectedly became incapacitated and what you want to happen with your estate when you pass away. It makes sense to put legal documents in place to take care of these things while you still can.
Tom Packer is an Elder Law Attorney serving all Southeast Idaho. Tom offers Life Care Planning to deal with the challenges created by long-term illness, disability and incapacity. If you have a question about a Senior’s legal, financial or healthcare needs, please call us.