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by Joseph A. Bollhofer, Esq. 

             The beginning of the year is a good time to pull out the last will and testament, power of attorney, health care proxy and living will to make sure that they still reflect your wishes. Likewise if you have a trust or any other planning documents. 

            If you have designated anyone as a beneficiary on a life insurance policy, annuity,  bank account or investment, you also should review those documents for potential changes. If you own any real estate, you should consider whether the deed accurately states who else owns it and what happens in case of death. 

            Whether a beneficiary has died or is no longer in your good graces, making no change will or could result in your assets being distributed in a fashion that you no longer intended. Of course, having this happen will not affect you, since you will not be around when it occurs. Perhaps more important to you should be the concepts of who will make decisions regarding your finances and care if you are not able to do so yourself, and how that person or persons will act on your behalf. 

            Finances and assets in general can be managed by a trustee under a trust you create or by an agent under a power of attorney document. Trusts can be revocable or irrevocable. They are more complex, but are valuable for many reasons. You will find various articles about trusts on my website.

             A power of attorney permits you to designate someone to act on your behalf for all matters, or only some that you choose. Usually a power of attorney is durable, that is, it is still valid if you become mentally incapacitated. In 2009, changes in New York law resulted in even the basic statutory form becoming more complex, especially regarding the agent’s authority to make gifts. Additions and modifications to the basic form are permitted, but only in a certain fashion. My website contains an article that explains the operation of the power of attorney and emphasizes the agent’s fiduciary obligation to act in the principal’s best interest (a concept that some agents do not fully recognize).

             You may name someone to make health care decisions for you under a health care proxy. However, this person has authority only if a doctor determines that you cannot make those decisions yourself.

              In a living will, you state your instructions to withhold or withdraw medical treatment that prolongs the process of dying.  These instructions will be applicable under the circumstances that you state in the document, and if you are permanently unable to communicate. The issues regarding such treatment usually overlap with an agent’s authority under a health care proxy and therefore your intentions should be discussed with your health care agent.

              The last will and testament, power of attorney, health care proxy and living will are basic planning documents. The last three are more than worth their weight in gold if the need arises. If, for example, circumstances develop where you cannot handle your own finances and/or cannot make health care decisions, these rather inexpensive documents usually will avoid the significant costs and delay of having a guardian appointed by a court.

              As people age, the concepts of long term care and how to pay for it become more important. Medicare, an entitlement for almost everyone, will not cover more than a limited period. It is important to have a discussion with a qualified professional regarding the big picture, including how any form of insurance and Medicaid might fit in.

              A basic legal checkup, including review of existing documents, should not cost very much. If all is in order, you will have the peace of mind of knowing that you have done what is necessary to protect yourself. If you need to have these documents created or to make changes to existing documents, basic estate planning also is not very costly, especially compared with the costs, both financial and emotional, of not having what you need in place when it is too late. 

Copyright 2017 Joseph A. Bollhofer, Esq.

Editor’s Note:

Joseph A. Bollhofer, Esq., is an attorney who practices law in the areas of elder law, Medicaid, estate and business planning and administration, and real estate. He is a member of the National Academy of Elder Law Attorneys, and of the Elder Law, Real Property, and Surrogate’s Court Committees of the Suffolk County Bar Association and of the Elder Law and Real Property Law Sections of the New York State Bar Association. He has been serving area residents since 1985 and is admitted to practice law in New York and New Jersey. His office is located at 291 Lake Ave., St. James, NY. (584-0100). For reprints of this article and others concerning Medicaid, Elder Law and Estate Planning, send a request to info@bollhoferlaw.com or visit www.bollhoferlaw.com.