Guest column: Estate plan should include power of attorney
7:10 AM, Jun. 28, 2011 | Written by Carissa Giebel
Planning for a period of incapacity, whether temporary or permanent, could be one of the most important aspects of your estate plan.
Oftentimes, estate planning is misunderstood. Many think of planning that is only necessary for the wealthy, and others think of a will. While estate planning may consist of either of those types of planning, there is a lot more to it. Disability planning, an integral part of the planning process, is planning for lifetime control over financial and health care decision-making.
Many are under the mistaken impression that if they are unable to make their own decisions, their spouse or their adult children could make those decisions for them. In Wisconsin, that is not necessarily the case.
If the legal documents are not prepared prior to incapacity, the only way for anyone else to have legal authority to make decisions on your behalf is through court intervention. Your loved ones will have to petition the court for guardianship over you, and a judge will determine who should be acting as an agent. The court process can be time consuming, costly and stressful.
The legal documents that everyone ages 18 and older should have include the power of attorney for finances and property and the power of attorney for health care.
The power of attorney for finances and property is where an agent is named to handle your financial situation and make any other powers you choose to give your agent, other than health care decisions. You can choose to give your agent broad authority, or you can be specific and only give your agent limited authority as spelled out in the document.
The power of attorney for health care has the same concepts, but instead you are naming an agent to make health care decisions if you are unable to make them on your own. These may be the same or different agents as those chosen for the power of attorney for finances and property.
It is important to understand what powers you are and are not giving your agents.
Not all powers of attorney are created equal. Each document can be uniquely crafted to meet your specific goals. It's important to understand what your power of attorney provides for and whether or not it allows for protecting assets from nursing home costs, if this is important to you.
It's also a good idea to name more than one agent, preferably at least three. If you name just one person, and that person predeceases you, becomes incapacitated, or is unwilling to act, then the document is just as good as not having one at all and a guardianship proceeding would be required.
These documents can be complex and cause many unintended results if not drafted and executed properly. The ultimate goal is to retain a lifetime of control without court intervention. Make sure your goals are implemented in the powers of attorney in your estate plan.