4 “Must Have” Estate Planning Documents for Seniors

By Jon Flynn

It was just this past December a friend of mine was getting ready to celebrate her elderly mother’s ninetieth birthday, when tragedy struck.  Her mother Janice had a stroke.  It soon became apparent that Janice would need around-the-clock care.  Janice, so proudly independent, was headed for a nursing home.  Because of her mother’s well known “vigor”, no one thought this would ever happen.  As a result, no estate planning was ever done.

Now faced with an application from Medicaid for the nursing home, my friend wishes she already had some “power of attorney” documents in place to be able to act on behalf of her mother.

4 “Must Have” Estate Planning Documents are:

1.      Last Will and Testament.  This document contains your instructions and desires as to how your property and assets are to be distributed after your death.  The will must be “valid”, meaning it must be in writing, signed by you, and witnessed by at least two other people.  If you die without a will, you have died “intestate”, which leaves open the possibility that a court will rule on who gets what from your estate. 

2.      Living Will.  Another important document.  This document kicks in when you are considered incapacitated and cannot speak for yourself.  It gives “your” instructions as to how you feel about certain life prolonging treatments that you want or do not want applied to you.  This document deals with topics such as “life support” and “feeding tubes”.

3.      Advance Medical Directive.  Sometimes called, Durable Power of Attorney for Health Care.  This is an appointment by you as to whom you would like to make very important medical decisions on your behalf if you are incapacitated. Having this in place allows your appointed person to provide “informed consent” to your physician, hospital, nursing home, and other medical professionals.

4.      Financial Power of Attorney.  This document also is established to legally appoint a power of attorney, but not for health care, but for financial matters.  You can control when this document takes effect.  If you like, it can start right away, or not until you are considered incapacitated.  You can also control the scope of your appointee’s financial powers.  Your appointee can be given the power to do everything on your behalf to pay for everyday expenses or to buy or sell an investment for you.  Keep in mind, some brokerage firms, banks, and other types of financial institutions will often require their own forms as well.  This should be considered in advance along with your planning.

The above documents really would have been so helpful to my friend with her mother Janice’s medical crisis.  Instead of my friend being able to act quickly with her mother’s best wishes in mind, she first needs to legally petition the courts to be able to act on her mother’s behalf.  To be given this authority can be both costly and timely. 

Everybody’s situation is different and arriving at solutions can get complicated.  So always consult with financial, legal, and tax professionals before making any decisions.

Jon Flynn is a Certified Financial Planner ^TM and owner of Flynn Financial in Eynon. He is a Representative of Securities America, Inc., Member FINRA/SIPC and of Securities America Advisors, Inc. Flynn Financial and Securities America are unaffiliated.   Mr. Flynn can be reached at 570-876-5000.