Powers of Attorney & Age Staleness: The Problem You Didn't Know You Had

Your Power of Attorney has a limited useful life! This is the problem of age staleness with Powers of Attorney.

One of the crucial components of every estate plan is the Durable Power of Attorney. There are two types, one for financial matters and one for healthcare issues. Many people believe that when they sign their Powers of Attorney the documents are good forever. This belief is incorrect.

This article was requested by one of my clients who just dealt with the age staleness problem recently. A bank (which shall remain nameless) refuses to accept her husband's Power of Attorney. The document is less than four years old. The bank is afraid of liability without an affidavit from the husband stating that the Power of Attorney still reflects his wishes. Ridiculous? Yes! This is the problem of age staleness.

In age staleness cases, the bank has no legal leg to stand on. The Power of Attorney is legally valid. However, the bank can refuse to accept anything they don't like and request either an updated document or an affidavit. There are two options to deal with age staleness:

1. Fight tooth and nail with the bank or produce the affidavit.

2. Update your Powers of Attorney regularly.

In most cases the second option is the better one. How do you do this? When you meet for your annual or biannual reviews with your estate planner, ask if it's time for updating your Powers of Attorney. You should plan on doing so approximately every 3–5 years.

If you have questions about age staleness issues, or any other estate planning questions, feel free to give me a call. Also, if you have comments on this article, please leave them here or send us an email. Thank you.

Bernie Greenberg

Your Turn: What Interests You About Estate Planning & Wills

It's Your Turn: What are you interested in? Are we writing about the right topics?

I am interested in what interests you about estate planning, Wills and trusts! I have written on these topics hundreds of times, but I want to make sure to cover the areas that you may find interesting or perplexing.

So now it's your turn. Comment back or write in. Whatever you would like to see covered or addressed. Even if it's about how politics now affects estate planning, we will address it.

Join the conversation and let us know your thoughts. What are your questions? What interests you in this area? What upsets you about these topics. It's your turn, we are waiting to hear from you.

Thank you.

Bernie Greenberg

Estate Planning FAQ: "What is the difference between a Living Will and just a Will?"

In this series of frequently asked questions on estate planning, we take this question:  “What is the difference between a Living Will and just a Will?”

This question is asked often since these two things sound so much alike. However, they are completely different and unrelated. Both are part of every client's estate plan.

Lifetime Documents: The Living Will.

A lifetime document is one which has validity during someone's life. A Living Will is a lifetime document. It is valid only while the maker is alive.

A Living Will addresses medical treatment near the end of life, such as a coma or similar condition. In my State of Colorado, the Living Will can either be simple and address only life support, artificial feeding and organ donation. Or, the Living Will can as extensive as you want and address many different medical treatment questions and living arrangements. I will address which type is better in a later article.

Another example of a lifetime document is a Power of Attorney. Previous articles discuss Powers of Attorney.

Testamentary Documents: The Last Will.

A Will, or “just a Will” as our questioner called it, is a testamentary document. A testamentary document is one which become valid upon the death of the maker. If you have a Will, it is not valid during your life. It's validity is created by your death. Previous articles here have covered the many different types of Wills.

So, the answer to our question is this: a Living Will is for your lifetime and expresses your wishes about medical treatment if you are unconscious or comatose. A Will is a death-time document and deals with the disposition of property, your children and similar issues. Detailed descriptions of these two documents appear in earlier articles here on this site and I encourage you to read those.

Let me know if you think this article answered our FAQ. Also, if you have comments or questions, please feel free to share them here. Thank you for your interest in estate planning.

Bernie Greenberg

 

Estate Planning FAQ: "I really don't have anything, so I don't need an estate plan, right?"

Estate Planning FAQ: Frequently Asked Questions:

“ I really don't have anything, so I don't need an estate plan, right?”

No, usually that's wrong. But read on.

This is one of the most frequently asked questions I hear about estate planning and Wills. The answer is usually, no, that's not right. Rarely though, it is possible to meet someone who really doesn't need a plan.

Let's explore this question further. Let's start with the thought that estate is not a question of how much you have (money or property) but about how much you care about 1) yourself; 2) your family; and 3) your decision making power. Beginning with this thought makes it easier to understand why most people really do need estate planning.

Let's assume that you are right and you have little if any property. If you answer any of these nine questions with “yes”, you need an estate plan:

1. Do you have kids?

2. Do you have any life insurance?

3. Do you care who raises your kids if you died unexpectedly?

4. Do you care who would control your children's money from your life insurance if you died unexpectedly?

5. Do you care who makes decisions for you if you can't make them for yourself?

6. Do you have anything that you want to leave to a particular person, or where what you do have goes if you died unexpectedly?

7. Do you care how you would be treated if you were in a coma?

8. Do you want to be an organ donor?

9. Do you have pets that to you are like your kids?

So how did you do with these nine questions? Did you answer any of them with “yes”. If you did, then you are proving that estate planning is not about how much you own.

Did you answer every question with “no”? If you did, then it is possible that you don't need an estate plan. However, I would still recommend you review these issues carefully before make your final decision.

If you did answer any of the nine questions with a “yes”, do you feel differently now about our frequently asked question? I hope so. I'll leave you with this quotation of mine:

“Estate planning is not about how much you have, but about how much you care about those people and things you do care about.”

That one sentence sums up best why just about everyone needs some type of estate plan. In my over 32 years of practicing law, I have met less than a handful of people who truly didn't need even a simple estate plan.

That's all for this installment of Estate Planning FAQ. I hope you found this article informative and thought provoking. Please feel free to add your comments and questions. If you have a question that you would like to see addressed in Estate Planning FAQ, please let me know. Thank you.

Bernie Greenberg