In our previous post, we began discussing the importance of establishing an estate plan which is able to reduce the likelihood of causing family conflict when you die or when you fall into a serious illness. Folks that fail to plan properly for these things may find the family up in arms when it comes time to make difficult decisions.
We left off discussing the benefits and drawbacks of having a trust-based estate plan. The downsides of trusts are that they are generally more expensive to set up and maintain. One also has to make sure the trust is properly funded. We'll look now at several other helpful documents to avoid family conflict.
If serious illness falls and you become incompetent to make your own health care decisions, it is important to have an advanced health care directive in place. These list your healthcare preferences and put family and caregivers on notice as to what types of treatments, tests and other care you want or do not want. These forms also allow you to appoint an individual or individuals responsible for making judgment calls for you in certain situations.
In addition to the advanced health care directive, another important document is the HIPPA release form. These allow the individuals listed in your advanced health care directive and/or your power of attorney for asset management to have access to your medical records in order to handle insurance matters on your behalf if you are unable to do so.
It is also important to appoint a power of attorney to manage your assets should you become unable to do so. They also allow you to avoid conservatorship. The form to establish a power of attorney for asset management allows you to list the areas in which you wish the individual to assist. You will also need to decide whether you want your appointed person to be able to handle your financial matters immediately, or only once you become incapacitated.
Following these tips, and others provided by your estate planning attorney, will help you avoid unnecessary family conflict.
Source: Forbes, "5 Key Estate Planning Documents To Help Avoid Family Conflicts," Michael Chamberlain, October 21, 2011.