Creating your estate plan requires thinking about several aspects of your life. While many people focus on the assets they want to pass down to their loved ones, there are other considerations that you need to think about.
A critical component of an estate plan is the power of attorney designation for health care and finances. These powerful tools enable you to name someone to take care of decision-making and other tasks if you become incapacitated.
1: Medical care matters
Medical decisions are often significant concerns when you’re impaired. The person you name in the power of attorney document for health care decisions will work closely with your medical care team. They’ll also follow the instructions you leave in your advanced directive, so be sure that’s always up to date.
2: Financial decisions and responsibilities
The financial power of attorney designation enables someone to pay your bills, handle investments and make any financial decisions you’d typically take care of. This individual should understand your wishes about everything related to money, assets and debts.
3: Powers end when you pass away
The powers of attorney end once you pass away. Regarding your finances, the estate administrator handles these matters once you’re gone. It’s possible to have the person with the powers of attorney designation take on the role of estate administrator.
Including the powers of attorney in your estate plan provides your loved ones with a roadmap for what happens if you become incapacitated. Remember, this is only one part of a comprehensive estate plan, so you should ensure you have everything to provide peace of mind for your loved ones.