Estate Planning Awareness Week was designated the third week of October, in 2008, by Congress. Our nation’s lawmakers felt the public should understand the importance and benefits of estate plans.
While passing the awareness week resolution was an earnest action by Congress, 57 percent of U.S. adults do not have any estate planning documents. That’s according to Caring.com, a senior care resources website. What’s interesting about that statistic is 76 percent of those surveyed say wills and trusts are important.
If so many individuals believe estate planning is important, why have so few taken steps for themselves? Some survey respondents reported they have merely put estate planning on the back burner. Other individuals said they do not think they need a will because they do not have a lot of assets.
First, immense financial wealth is not a requirement for an estate plan. There are essential estate plan documents everyone needs, such as a power of attorney and a health care decision-maker. Second, putting off estate planning could have an adverse effect on you and your family when you least expect it.
Why You Should Have an Estate Plan
Estate plans deal with more than just money.
Comprehensive estate plans cover who makes critical medical decisions when someone becomes incapacitated. It ensures there’s someone to act on your behalf. And, yes, estate plans cover how your assets – your life savings, house, and other property – are passed down according to your wishes.
Estate planning can be an emotional journey. Not only does the planning take time, in some cases six months, it also forces you to carefully consider important aspects about your life and your loved one’s lives.
What You Should Consider in an Estate Plan
Do You Have a Last Will & Testament or a Trust?
In Colorado, if you pass away without a will or trust, your assets are considered intestate property. If you pass away without a will, Colorado’s intestate succession rules dictate who gets what.
In other words, your money, house, and other personal effects could go to people you would have never given it to, or your loved ones may not receive as much as you actually wanted them to.
Here’s a look at Colorado’s intestate succession order:
|If you pass away with:||The outcome will be:|
|children but no spouse||children inherit it all|
|spouse but no children||spouse inherits everything|
|spouse and children you had with that spouse, and your spouse has no other children||spouse inherits everything|
|spouse and children you had with that spouse, but your spouse has other children||spouse inherits the first $225,000 of your intestate property, plus half of the balance; your children inherit the rest|
|spouse and your children from another relationship||spouse inherits first $150,000 of your intestate property, plus half of the balance; your children receive everything else|
|spouse and parents||spouse inherits the first $300,000 of your intestate property, plus three-quarters of the balance; your parents inherit the remaining property|
|parents but no spouse or children||parents inherits it all|
|siblings but no spouse, children, or parents||siblings inherit everything|
When you spell out your wishes in a will or a trust you’ll gain peace of mind, and you will also prevent unnecessary confusion, anxiety, and expense for your loved ones after you’re gone.
Do You Have Powers of Attorney Prepared?
If you become incapacitated, you’ll want a trusted person to make decisions for you and act on your behalf, right? Of course you do. Unfortunately, these vital decision-making powers could be left up to a court if you do not name someone ahead of time.
Estate plans designate a medical power of attorney. This person will make critical health care decisions for you if you become incapacitated. They’ll be privy to your wishes and can ensure they’re followed.
A financial power of attorney is someone who makes financial and property decisions for you if you can’t handle your own affairs. For instance, if you develop dementia and can no longer manage your own finances, your financial power of attorney would assist you.
When you plan for these scenarios in advance, it reduces some of the stress your loved ones will face if you’re ill or injured. Plus, it lets your voice be heard when you’re unable to speak for yourself.
Do You Have an Advance Directive?
Is an advance directive the same as a medical power of attorney? No. An advance directive is the document that outlines your medical care wishes if you can’t speak for yourself.
In Colorado, four documents are recognized as advance medical directives: a living will, durable medical power of attorney, a CPR directive, and a Do not Resuscitate order.
If you experience a medical crisis, your family may have to go to court to get the authority to make health care decisions for you – when they could be by your side.
If you make these decisions now, you can decide what kind of treatment you want. You’ll also ensure your loved ones have one less thing to handle when all they want to do is see you get the care you need.
So what’s the difference between these documents? Let’s take a look:
A living will is sometimes called a health care directive. It lays out what kind of treatment and life-sustaining efforts you want doctors to take, or not take, in the event you’re in a persistent vegetative state or can’t personally communicate your choices to your family. One has to be in a coma for a week before a living will takes effect.
An estate planning attorney can draft a living will for you.
Durable Medical Power of Attorney
The durable medical power of attorney names the person who makes medical decisions for you if you are incapacitated. This person is responsible for ensuring your medical treatment wishes are carried out.
Do Not Resuscitate Order
A do not resuscitate order, commonly referred to as a DNR, is used to request that hospital staff should not administer CPR if you stop breathing or your heart stops beating. This document is created and signed by your doctor, not your attorney.
A DNR is used in cases of terminally or severely ill patients or very fail elderly persons. Many times, these individuals may seek a DNR if they wish to avoid aggressive intervention.
For CPR wishes outside the hospital, state law allows for a CPR Directive. It will instruct EMS personnel, health care providers, and anyone else who could assist you that you do not want CPR if your heart or breathing ceases.
Like a DNR, you must have your doctor sign your CPR directive.
Medical Orders for Scope of Treatment
Finally, you may also consider a MOST order. MOST stands for Medical Orders for Scope of Treatment. it’s a form that, again, your doctor must sign. A MOST form may be used in addition to or in place of a CPR directive. However, the MOST form usually provides additional information about your end-of-life care.
MOST forms differ from other health care directives. In addition to your directions about what life-sustaining measures you want, or don’t want, life CPR, the MOST form can include your wishes about artificial breathing devices (intubation), feeding tubes, and even antibiotic use.
Talking to Your Family about Creating Estate Plans
Estate Planning Awareness Week is a great time to talk to family members about not only your personal estate plan intentions but theirs, too. If you have elderly parents or a loved one who was recently diagnosed with early onset dementia, for example, now is a good time to ask them if they have considered their own estate plans.
Not everyone is receptive about discussing estate planning because it comes with difficult issues, such as aging and death. Here are a few tips to help you broach the conversation with your family if you wish:
Be Sensitive to Their Feelings
One way to begin the discussion is to first talk about the need to plan for an illness and provide instructions in the event you or they become ill and there’s an inability to communicate with doctors.
Let the conversation progress naturally, and keep in mind that few people are eager to delve into the subject about their passing away. Be sure to tell your family you’re not trying to control their decision, but you want to ensure yours and theirs are known so they can be carried out if the time comes.
You may mention planning in advance lets them decide who they want to receive their savings and home. You can note that creating an estate could reduce taxes court costs, and legal fees that can come with intestate property.
Involve Other Family Members
If you arrange to talk to your parents about a need for estate plans, try to include any siblings. First, it avoids the impression that you’re trying to influence your parents. Second, you and your siblings together can underscore your desire to make sure their wishes are carried out if they get sick or pass away.
Contact Estate Planning Attorney Bill Henry
Bill is Robinson & Henry’s lead elder law and estate planning attorney. He strives to relieve his clients’ worry about the future and during times of crisis. Bill utilizes the law to protect his clients’ interests and preserve their wealth.
“The thing I like most about working with clients is the opportunity to lessen their stress, lighten their burdens, and provide real relief from legal problems weighing heavy on their minds and hearts. It is very rewarding to protect my clients’ interests and set them on a course that will lead to greater success.”
Schedule online a time to sit down with Bill to discuss your particular needs and what you hope to accomplish. You can also call (303) 688-0944 to arrange your appointment. Your initial visit with Bill is free.