CHAPTER
20

Wills, Powers of Attorney, and Health-Care Directives

In This Chapter

• Why you need a will
• Getting a will is easy
• Setting up a power of attorney
• The importance of an advance health-care directive

When you’re young and just getting started on your own, the thought of wills, powers of attorney, and health-care directives probably seem as foreign to you as using a walker or researching retirement communities. Life moves pretty fast, however, and it’s best to be prepared.

In this chapter, we explore these legal documents and explain why they’re important for everyone.

Because the couple was young and hadn’t thought about getting a will, several things kick into play—none of them good. First, the state chooses guardians for their kids, meaning the children could be uprooted and sent off to another state to live with their grandparents instead of moving down the street to their aunt’s house, which would have been the parents’ wish.

Next, the distribution of any assets the couple had accumulated is in question because they had left no instruction regarding who should get them. That includes their house, cars, bank accounts, investments, and any other property they may have had.

According to the online legal technology company Rocket Lawyer, 64 percent of Americans do not have a will. Very few people in their 20s and 30s have wills, which is understandable … but not smart. If you die without a will, or intestate, there’s no guarantee who will inherit your assets. Even if you don’t have a lot, wouldn’t you rather determine who gets it than have the state decide?

Definition

Dying intestate means dying without having prepared and executed a will to determine who receives your assets.

Having a will is particularly important if you have kids. There should be no excuses if you fall into that category. If you’re married and die without a will, your assets generally go to your spouse. If you’re single and childless, it’s likely the state will decide which relatives get your assets.

So why is it that more than half of all American adults don’t have a will? Rocket Lawyer surveyed people about why they didn’t have one. Here are their responses:

• 57 percent said they simply hadn’t gotten around to doing it.
• 22 percent felt there was no need to hurry to make a will.
• 17 percent didn’t see any need to have a will.
• 14 percent didn’t make a will because they didn’t want to think about dying.

The Advantages to Having a Will

In addition to directing who gets your stuff and appointing a guardian for your children, a will serves a number of other purposes. You can …

• Name an executor.
• Name a property manager for property left to your children. If you leave property to minor children, an adult needs to manage it. A will gives you a vehicle for appointing someone you trust to manage your property until your children are of age.
• Transfer real property, such as your home, to another person.
• Appoint someone to take care of your pet.
• State your wishes concerning burial, cremation, and the type of sendoff you want. This can be extremely helpful to your loved ones.
• Designate money or property to be given to a charity or cause that’s particularly important to you.

Definition

An executor, or a personal representative, is someone who oversees the distribution of your property and ensures the terms of your will are followed after you die. If you don’t have an executor, the court will appoint someone to do the job.

Creating Your Will

You can have a lawyer make a will for you, or you can make it yourself. You’ll need to sign it after you write it and have two witnesses sign as well. If you want to have a lawyer do your will and you don’t have a lawyer, you can contact your local bar association and ask for the name of someone who can help you.

You also can download software, sometimes for free, to create your own will. LegalZoom offers a last will and testament online, and Quicken’s WillMaker software walks you through the process of making a will—much like a tax software program. You fill out a form, which is reviewed for completeness and consistency. Some companies offer a guarantee that your will is legally acceptable but may charge extra for that service.

If you do your own will, it’s advisable to have it reviewed by an attorney. And if you use a software program, be sure it’s legal in your state. The program should specify in which states it can be used.

Powers of Attorney

At this point of your life, having a durable power of attorney (and an advance health-care directive, discussed next) is arguably even more important than having a will. A durable power of attorney is a legal document in which you designate someone to handle your financial business for you in the event that you are unable to do so.

Definition

A durable power of attorney enables you to designate another person to handle your financial transactions if you become incapacitated and are unable to do so.

If you’re in a car accident and temporarily unable file your tax return, pay your mortgage, and take care of your bills, the person you appoint as your power of attorney can do those things for you. Also, if you would become permanently incapacitated—a terrible thing to think about, but it happens—having a power of attorney eases the way for loved ones. The person who you designate will handle your financial affairs should you become incapacitated, so it’s important to assign someone who is capable and who you trust will follow your wishes and instructions.

Advance Health-Care Directive

If you know the name Terri Schiavo, you’ll realize why it’s important to have an advance health-care directive.

Definition

An advance health-care directive is a legal document that spells out your wishes regarding health-care decisions and appoints someone to make health-care decisions on your behalf if you are unable to do so.

In 1990, the 26-year-old Florida woman fell into a vegetative state after suffering cardiac arrest. Her parents believed their daughter would recover and fought to keep her alive, while her husband argued that she would not have wanted to exist in her current state and wanted to disconnect his wife’s feeding tube.

The long, public battle that ensued was heart-wrenching, and it lasted for 15 years while the courts, the Florida state legislature, and then-Florida Governor Jeb Bush all weighed in. Schiavo’s feeding tube eventually was removed, and she died in 2005 at the age of 41.

Having an advance health-care directive can spare your family years of anguish.

There are two parts to an advance health-care directive:

• Living will
• Health-care proxy

Living Will

A living will enables you to state your wishes regarding end-of-life medical care. It kicks in when you unable to communicate your wishes.

In a living will, you stipulate whether or not you want medical professionals to take actions such as resuscitating you if your heart stops beating, if you want mechanical breathing if you’re unable to breathe on your own, a feeding tube if you’re unable to eat on your own, or ongoing dialysis if your kidneys cease functioning.

It’s hard to think about end-of-life care at this stage of your life, and hopefully you’ll never need a living will. But accidents happen, embolisms occur, and fatal infections can take over. Having your wishes in place can make a situation like this much easier for family members and friends as they struggle to make seemingly impossible decisions.

You also can include in a living will your wishes to have your organs donated after your death, if applicable.

Health-Care Proxy

Appointing a health-care proxy is not something to do without giving the matter a significant amount of consideration.

A health-care proxy, also referred to as a health-care surrogate or durable medical power of attorney, is a legal document in which you designate someone to handle decisions concerning your medical treatment and care. The person you appoint then has the authority to make medical decisions if you are unable to do so, such as if you were in a coma or had suffered a head injury that made it impossible for you to express your preferences regarding your medical treatment.

You can see how important it is to appoint a representative who fully understands your wishes regarding treatment and whom you trust to fully uphold those wishes. Making medical decisions for a loved one can be an extremely difficult and emotionally wrenching job. Ideally, you’ll appoint someone who is comfortable interacting with health-care providers in a medical setting.

Generally, you’ll appoint just one person as your health-care proxy. You might, however, consider appointing one or more alternates in case your primary representative is not available for some reason.

Dollars and Sense

Regulations regarding legal documents such as wills, powers of attorney, and health-care directives vary from state to state. It’s best to check with a lawyer when dealing with all important legal documents to ensure they’re done correctly and in adherence to your state’s laws.