Estate planning needs to change throughout life. New parents have different concerns than those with children off at college. Business owners, people with chronic medical conditions and unmarried adults all have vastly different estate planning needs and priorities. Identifying personal needs and planning accordingly is valuable for people, regardless of their circumstances.
People who are approaching retirement age may need to sit down and establish an estate plan if they have not done so already. Even if they have documents in place, they likely need to make significant revisions as they prepare to live on a fixed income in their golden years.
In addition to updating beneficiary designations, testators may want to consider adding new documents to their estate plan. Durable powers of attorney can be useful for many adults, but they are especially important for those who are on the verge of retirement.
Why are durable documents so helpful?
Standard powers of attorney are common estate planning documents. People can designate someone they trust to make medical decisions on their behalf if they become incapacitated. Financial powers of attorney can authorize another adult to access a person’s resources and manage their financial obligations during their incapacitation.
Powers of attorney usually lose their authority when the incapacitated individual recovers or dies. Additionally, basic powers of attorney may lose their authority if a person becomes permanently incapacitated. When a person is at their most vulnerable, the documents they drafted for their own protection could become useless.
Durable powers of attorney are different. They retain their authority even if the principal becomes permanently incapacitated. In plain English, that means that someone who develops dementia or declines cognitively as they age can trust that their durable powers of attorney retain their legal authority.
Instead of being at risk of involuntary guardianship, they can select the person who supports them years before they need that assistance. Durable powers of attorney can help ensure that a trustworthy individual has the legal authority to manage an incapacitated older adult’s finances and oversee their medical care.
Adding durable powers of attorney to an estate plan can be a smart move for people thinking about how they might be vulnerable as they age. Durable documents can help provide protection and peace of mind.