Basic Estate Planning

I spoke with my niece the other day. She is a new mother and had some questions about what kinds of basic estate planning she should consider. In her case, her family is just getting started and has few assets. However, with the birth of her son, she is concerned about who would care for him or make medical or financial decisions for him if she and her son’s father were suddenly deceased. Due to the fact that her son’s care was her primary concern, and there were few assets, I recommended to her that she needed to do just basic estate planning. For her, this would entail putting together a Will, a living will, a health care power of attorney, and a financial power of attorney. These four documents operate together and provide a flexible, essential estate planning package.

The will, of course, lets my niece direct whom will receive her property upon her passing. More importantly, though, it also lets her nominate a guardian and conservator for her son. A guardian is a person appointed to make decisions about a ward’s person and care. A conservator is a person nominated to make decisions about a ward’s money or assets. The person she nominates will still need court approval. However, the nomination gives that person the highest priority and the court will not permit a person with lower priority be appointed unless the nominated person chooses not to accept the nomination or is shown to not be a fit and proper person.

The Living Will is a document which allows my niece to make choices about her health care if she is unable to communicate them herself (for instance, if she is in a coma). The Living Will typically covers a wide range of eventualities. However, anything not covered by the Living Will, can be addressed by the person my niece appoints as her agent under the Health Care Power of Attorney. She will want to appoint someone she trusts, and someone who knows and understands her health care wishes. In my niece’s case, because she is not married to the father of her child, this would be very important because her significant other does not have any legal right to consent to her medical treatment in the absence of being nominated as her agent under the Health Care Power of Attorney. Because my niece is the primary caregiver for her son, protecting my niece in this way also protects her son.

Finally, the Financial Power of Attorney is important because it will appoint a person as my niece’s agent to handle her financial issues if she is unable to. Similarly, if her significant other does the same estate planning, he will appoint a person to handle his finances. In this case, he should consider appointing my niece as his agent so she will have access to his finances/assets. He is the primary breadwinner, and because they are not married, my niece may not be permitted access to his accounts or assets. Of course, they could open a joint account. But, there could still be problems accessing his sole and separate accounts, or perhaps picking up a paycheck, obtaining information on his credit accounts, etc. Having the Financial Power of Attorney in place will likely solve most or all of these kinds of problems.

This basic kind of estate planning is sufficient for many people. However, every person’s situation is different. Consult with a knowledgeable estate planning attorney to help craft an estate plan that is appropriate for you.