Do You Have a Child in College?

We know that the summer is a great time to spend at the beach, but did you know that it is also a great time for your college kids to execute powers of attorney while they are home.

Many parents are surprised to learn that when their children attain the age of 18, they can no longer gain access to their children’s health care information, or schedule doctor’s appointments on their behalf. 

In NH, an 18 year old is considered to be an adult and for that reason, in order to act on behalf of your now adult child, either medically or financially, your child needs to execute a financial power of attorney and health care power of attorney.

Why So Many People Update Their Estate Plans Every Five Years

A common question from many of our clients involves identifying the right timeframe for updating an estate plan.
 
Generally speaking, there are three reasons whey plans should be updated on an approximate five-year cycle:

1. Changes in law, including tax laws
2. Changes in family situation
3. Changes in financial position

In some cases updates should be made more frequently, such as when changes in family situation occur including births, marriages, deaths, and so on. But generally speaking a five-year updating cycle is a good target.

Guardianships Can Apply to Anyone at Any Age

People often think about guardianships as applying to children, but they can apply to anyone at any age.  

For example, did you know that when your child turns eighteen (18) years of age, you no longer have the legal authority to make heath care and financial decisions for him or her unless your child appoints you to act for him or her? 

  

Do you know that the same is true for your spouse as well, and that if you do not have a document that allows your spouse to do so, your spouse cannot access your retirement accounts, or the cash in your life insurance policy, if needed? 

 

The legal documents that allow you to make decisions for someone else are called a health care power of attorney and a financial power of attorney.  These documents can significantly minimize stress for family and friends down the road. It is also important that these documents be drafted correctly. 

Were you also aware that in New Hampshire an agent under a financial power of attorney cannot make gifts unless the document specifically grants the agent the power to do so?  

An adequate gifting provision can be a very important tool with respect to long term care planning and the protection of the healthy spouse. If a person does not execute those documents prior to becoming incapacitated, or if the documents do not contain the correct language to allow for planning, a guardianship over that person becomes necessary. Guardianships can be stressful, time consuming and costly. For those reasons, we recommend that everyone 18 years or older execute these documents.

Two Estate Planning Musts!

While we will be resuming our "Caring for an Aging Parent" series soon, an interesting question came up recently that we want to share.

A potential client called us the other day and asked us which estate planning documents were absolutely essential. It is our belief that everyone 18 years and older should have two documents:
     1. Durable Power of Attorney for Health Care
     2. Durable Power of Attorney for Financial Matters

These documents ensure that someone can act on your behalf if you’re disabled or incapacitated. Without these documents, a guardianship will likely be necessary. Guardianships are typically costly, time-consuming and stressful. In a guardianship, you lose control and the Court decides who will make health care and financial decisions for you.

It our experience that families could alleviate stress and save thousands of dollars by executing these two documents when they are healthy and able to do so.