Many financial issues have changed as we deal with the coronavirus pandemic.
One of them is how we look at estate planning.
This is an area that many people are reluctant to discuss. Many do not like to deal with these issues. The death and family isolation of COVID-19 have brought this subject to the forefront.
If someone comes down with the virus, they are immediately isolated from their family and friends. It is important to have prudent planning in place before this situation occurs and have an effective communication plan. A plan is useless if no one knows it, or knows who makes the necessary decisions.
It is important to get your documents in order. These could include a will, trust documents, financial power of attorney and advanced directives/healthcare power of attorney. Also life insurance, retirement papers and information on other financial assets should be organized. It might be a good idea to create a “Grab and Go Package,”which lists all medicines, personal info, emergency contact, power of attorney documents and other such information in an envelope to go to the hospital with the patient. Many people have a contact telephone number in their cellphone that is titled ICE. Medical personal know that this stands for “In Case of Emergency.”
While hospitals will usually listen to the wishes of a spouse, the power of attorney is very important when adult children must make decision. Have only one primary person designated. There may be a backup person if the primary cannot be promptly reached. Some people are reconsidering healthcare directives, because while you may not want to be on a ventilator permanently, some COVID patients survived after being placed on one.
Ask your attorney if your power of attorney needs to be durable to stay in affect if you become mentally incapacitated.
Make sure you update these legal documents if you move to another state as laws are often different. Some families have major problems if their college-age children get seriously sick. If the child is over 18, the parents should have a signed HIPAA authorization, healthcare power of attorney and a durable power of attorney. Without these documents, the parents may not be able to help their child.
Make sure key people know where your health insurance paper work is and that health savings accounts are funded. Update beneficiaries and include contingent beneficiaries. Things change and if you wanted to include someone new or remove someone, this must be done while you have capacity. Beneficiary’s designation override provisions in your will. Remember the changes made by the SECURE Act may call for different allocation between your higher and lower income beneficiaries.
Make sure you communicate your plan to those who need to know and that everything is organized. Don’t forget to include a list of passwords to access your various online accounts. If the virus strikes, things can change fast.
Make sure your family is prepared.
Gary Boatman is a Monessen-based certified financial planner and the author of “Your Financial Compass: Safe passage through the turbulent waters of taxes, income planning and market volatility.”
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