Do you have a back-up or someone to look out for your affairs if you get “knocked out?” Most people have heard of a power of attorney, but do not fully comprehend what they are. A power of attorney gives someone of your choosing the legal authority to manage your affairs if you are incapacitated. A power of attorney can be limited to only take effect if you are completely incapacitated, or it can give a person authority to act if you are out of town.

It seems that with the rise of debit cards, many couples have separate checking accounts. If one spouse had an accident and was in a coma, who would pay the bills? If both names are not on the checking account, accessing the money could pose a serious problem. A power of attorney would solve this problem (and many others) before it ever happens. Your spouse (or mother, etc.) could have full authority to pay bills out of your account, transfer money or any other necessary function while you are incapacitated.

There are also different types of powers of attorney. A durable power of attorney gives a person authority to handle your affairs until it is revoked or until your death. Others may be limited to a transfer of real estate. For example, if you have a closing date set for purchasing a house, but your spouse is out of town, you can execute a limited power of attorney authorizing your spouse to sign all of the documents necessary to complete the purchase. A medical power of attorney gives your representative the authority to make certain decisions regarding your health care and to discuss your health with your doctor or hospital.

While my Grease scenario might be cheesy, it is definitely true that everyone needs a “second.” Planning ahead for these situations helps not only your peace of mind, but helps your family in the event of a catastrophic event.

To keep with our “planning” theme, but also moving more into my area of practice, my next blog will explain beneficiary deeds. Stay tuned. . .

The importance of estate planning was brought home to me (again) last week as I sat at the gym watching my kids at gymnastics and talking to another mom. This mom (I will call her Amber) recently lost her father who lives in another state. Her father was in the middle of a divorce, but it was not final. Unfortunately for Amber and her brother, her father had not updated his will or other matters in quite some time. His will still provided that his soon-to-be ex-wife would receive quite a bit of his estate. There were also certain parts of his estate that were not provided for at all in his will. Amber and her brother have now spent countless hours and money going from their home states to their father’s state in an attempt to sort things out.

What is the point of my story? The point is, for a minimum amount of planning and money, Amber’s father could have updated his will and eased the burden on the family, saving them not only money, but time and stress. Nobody wants to think of their mortality, but it is a necessity. For example, when my grandmother died, she did not have a will. (She died intestate. Lawyer speak for “no will.”) My grandfather believed that everything she owned (under Arkansas law) would go to him. He was sadly mistaken. While the probate code does provide certain allowances for the surviving spouse, the children of the deceased receive the bulk of the inheritance. My grandparents were married for over 50 years, but my grandfather, legally, did not inherit my grandmother’s estate. What would your spouse do if you died and all of his/her money and belongings went into a trust for your children?

That leads to another issue: minor children. Who do you want to raise your children in the unfortunate event that both of their parents are deceased? Do you want to have a say in that decision, or do you want a judge who has never met you or your children to decide? Even the simplest of wills can designate your choice for the guardian of your children. The designation is not binding on the court, but is usually given great deference in the appointment of guardians.

Give me a call if you would like to discuss your options. And, stay tuned. The next installment of my ever exciting blog deals with powers of attorney!