This year both my parents retired due to health problems. Since then, I have taken up the role of caregiver; handling everything from their finances to their health. In order to act on their behalf I helped them execute several documents which allow me to make such decisions for them.
Ideally, executing documents allowing someone to act on your behalf in case of an emergency or incapacitation should be part of your retirement/estate planning. Unfortunately, most people plan for retirement and Medicare, but overlook planning for an emergency or incapacitation. No one wants to think that they will ever become incapacitated but it happens, especially as people live longer due to medical improvements.
The following documents are needed to legally permit someone to act on your behalf in case of an emergency. The documents listed allow a specified person to make either financial or medical decisions on your behalf. It is highly recommended you contact a probate attorney specializing in estate planning and/or elder law for more information about each document.
1) Durable Power of Attorney – authorizes a specified person the right to make financial decisions on your behalf; if you are currently able to make your own financial decisions, you can opt for a “springing” power of attorney which only takes effect when you are deemed unable to make such decisions–it “springs” into effect once you are deemed incapacitated
2) Health Care Proxy – authorizes a specified person the right to make medical decisions on your behalf if you are unable to do so
3) HIPAA Form – allows medical providers to keep a specified person informed about your health status and treatment
4) Revocable Trust – put your assets in a revocable trust and give a specified co-trustee power to use the assets according the rules you specify in the trust
5) Will – draft a will stating what should be done with all your assets not in the trust after you die
If these documents aren’t prepared ahead of time, when there is an emergency, a family member will have to get a court to deem you incompetent and assign you a legal guardian. Obtaining a court order declaring a person incompetent is both costly and emotionally draining on the family. As such, it is highly recommended you prepare these documents while you are still competent. Doing so will ensure the person you want handles your affairs and will make it easier on your family.
Bahin Ameri is a Houston-based real estate attorney. The focus of her practice is on real estate law and business law. She handles a variety of cases including contract/lease disputes, property disputes, and small claims. Bahin also handles business formations, applications for state benefits, and homestead exemptions. Her clients include homeowners, small business owners, landlords, tenants, and individuals seeking state benefits.