Picking the Right People
Since COVID, many people have begun taking action in working on their Estate Plans but sometimes the most challenging part of completing the estate planning documents is figuring out who to put into each role. So how does one choose?
Beginning with the Power of Attorney, also commonly referred to as a POA, is a legal authorization that gives a designated person the power to act for someone else. There can be two different types of POAs; financial and medical (HCPOA). Generally, a POA is used when someone is temporarily or permanently ill or disabled. Once you grant someone as an agent under a POA, it is almost like “signing a blank check,” so it is important to make sure it is someone you have full trust in.
You want to pick someone whom you trust to handle these special affairs for you. This could be either a sibling, parent, spouse, or kid. Some people even choose to pick very close friends as well. In the end, though, it needs to be someone who is close to you and not too far away especially if something happens abruptly. It is important to note here that it is important to make these decisions early on because once you become incompetent you will not be able to make these decisions or appointments. Kiplinger.
Another important document for which you will have to choose a representative is a Trust. Here, there are hardly any restrictions when it comes to who you can or can’t choose. For those who are in higher tax brackets, it is usually suggested to pick an independent fiduciary to not have anyone be overly influenced in what decisions you want to make. Kiplinger. Alternatively, to the POA, you can choose people who are not proximately close to you but the person must be willing to put in the time it will take since it can be time consuming.
No matter the age or circumstances – it is important to have a comprehensive estate plan to help ensure your family can best support your future wishes and that you have selected the proper people for each position. For more information on what may work the best in your estate plan, reach out to the Professionals at The Center for Financial, Legal, & Tax Planning Inc., at (618) 997-3436.