The coronavirus pandemic has been a shocking reminder that life can change quickly and many people are finding their minds wandering into worst-case scenarios. That, of course, leads to thoughts of estate planning and making sure loved ones are cared for in the unlikely event that disaster strikes.
But estate planning doesn't have to be a gloomy process. In fact, during these unpredictable times, it can be empowering to take control of your affairs and know that your wishes will be carried out regardless of what happens. It's a way of confronting this crisis with a solid action plan.
Estate Planning Documents You Need During the Coronavirus Crisis
Estate planning documents address a wide range of issues, from wills to trusts to powers of attorney. Every estate plan utilizes several documents customized to each individual's unique needs and circumstances. Out of all of these documents, a will is probably the main document people think about having in place when it comes to an estate plan.
But during a pandemic, the following estate planning documents also play an essential role.
Health care power of attorney. Having a health care power of attorney in place is essential when dealing with the health crisis arising in the wake of the coronavirus pandemic. Attorney David Bross, an estate planning specialist with Truepoint Wealth Counsel, notes that a health care power of attorney gives your agent the authority to make healthcare decisions on your behalf if you are incompetent or incapacitated.
"If you're over the age of 18 and do not have one," he says, "there is no person with the ability to act on your behalf if you are incapacitated." In such cases, family members would need to apply to Probate Court to obtain these powers, an often time-consuming and expensive course of action.
Durable power of attorney. If you become sick, your day-to-day financial transactions must still be carried out. Having a durable power of attorney for your financial matters plays an important role.
"If you become ill or injured, someone else must step in to help you care for your finances. With a durable power of attorney, you name a trusted person to pay bills, make bank deposits, collect benefits, and handle other money matters on your behalf," says Somita Basu, an estate planning and probate attorney at Norton Basu LLP. "Without this important document, your loved ones will have to go to court to get a conservatorship to manage your financial affairs."
Living will. Also known as an advanced health care directive, estate planning experts are in agreement that a living will is essential. According to attorney Amber Yerkey James, founder and CEO of New Beginnings Family Law P.C., "without a living will, your family will not know your end of life wishes about matters such as being placed on life support, remaining on life support, and whether or not you would want to be resuscitated should your heart stop beating."
Bross adds that having to make such emotional decisions on your behalf can be particularly trying for your family members at such a difficult time. "By creating a living will, you set forth your wishes and take that decision out of your family members' hands," he notes.
HIPAA waiver. Having a standalone HIPAA waiver is also important. According to Basu, "while your advanced health care directive will likely contain language that allows your agents to access your medical records, it's not uncommon for medical facilities to refuse access to medical information without a standalone HIPAA Waiver." She suggests having one as a back-up document.
With a HIPAA Waiver in hand, your nominated agents and family members will have access to your medical information so they can speak freely with your health care providers in case of a medical emergency.
Children and Estate Planning
If you have children, there are other important issues to take into consideration when working on your estate plan. Depending on whether your children, you should also consider having the following documents in place:
Nomination of a guardian. If your children have not yet adults, it's important that you nominate a guardian for them. This can be done in your will, or as a standalone document.
When it comes to selecting a guardian, Basu advises parents to consider their values and who would best care for their child. She also notes that if you share custody with a co-parent, you should be aware that the court will likely consider the other parent a very suitable choice for a guardian of your children when you are gone, assuming there are no issues concerning either violence or criminal behavior that involve your co-parent.
Trusts. Bross notes that individuals who have children almost always need a trust, even if their assets are minimal. "If there is no trust in place," he says, "a minor will inherit through a guardianship until they reach the age of 18. The Probate Court has oversight of the guardianship. At age 18, the assets are given to the child outright and unrestricted. A simple trust can be created to keep assets in trust for the minor and set forth how the child is to receive the assets and when. Further, you can ensure the assets are protected, both from creditors and in the event of your child's divorce."
College-aged children. If you have children in college who are over the age of 18, it's important to talk to them about preparing their own set of estate planning documents.
"Once a child reaches the age of 18, a parent cannot make health care or financial decisions on their child's behalf unless there is a court-ordered guardianship in place," Bross points out. "At Truepoint, we recommend that each child of a client over the age of 18 create their own set of documents in case of an emergency."
The Practical Matter of Witnesses and Notaries
One important consideration of estate planning during a pandemic is the issue of obtaining the required signatures. State laws vary, but you will likely find that at least one document in your estate planning toolkit will require the signatures of either witnesses or a notary public, or even both.
Basu notes that the legal standards for witnesses do not change during the pandemic. This means any witnesses to your legal documents must be disinterested individuals who will not benefit from the documents they are signing, and they must also actually witness you signing the documents in person. With many people self-isolating or in quarantine, obtaining such signatures can present a challenging prospect.
Fortunately, the situation is continually evolving, with both attorneys and states continuing to come up with practical solutions to the issue. "With social distancing guidelines in full force, getting estate documents signed and notarized is complicated," Bross notes. "I've seen some attorneys schedule a document signing in the driveway where the signor, the witnesses, and the attorney all stand 10 feet away, then rotate signing the document."
James' law firm, for example, offers a drive-up service. "The client drives up in their vehicle and remains in the vehicle," she says. "Our team, while wearing masks and gloves, approaches the vehicle with a disinfected clipboard, pen, and two copies of the documents to be signed. The client signs the documents and hands them to the notary. The witnesses, provided by our firm, sign the documents, and then the notary signs the documents as well. The firm maintains one original copy, which is again disinfected and placed in our secure safety deposit box. The other original is provided to the client in a folder."
There are other possible solutions. "Some states, such as Kentucky, are relaxing their laws to allow estate document witnesses and notaries to participate in the signing via webcam, and then the document is signed by the witnesses and notary at a later date," Bross says. "And the use of remote notarization websites is increasing."
In times of uncertainty, creating an estate plan can help you feel more in control of your destiny. Having a proper estate plan in place is always a good idea, and during these challenging times, strengthening your estate plan, or implementing one if you don't have one, may go a long way toward enabling you to feel able to face the coronavirus on your own terms.