As the death toll from coronavirus continues to rise around the world, many people have drafted or revised their estate plans, as a safety precaution during these unprecedented times.
An estate plan includes a series of documents that instruct loved ones what to do with a person's estate after they die or if they become incapacitated. The COVID-19 pandemic has placed increased urgency in making sure these tools are in place, including a will, beneficiary designations, advance directive, trusts, powers of attorney, and property ownership.
Why is estate planning on the rise during COVID-19?
Everyone is trying to protect themselves and their families at this time. According to CNBC, the two populations that have rushed to create online wills are parents with minor children and people over 50 who are concerned about contracting the disease.
Older adults especially have been creating or amending their estate plans, because according to the Centers for Disease Control and Prevention, eight out of 10 deaths from COVID-19 in the U.S. have been in adults 65 years of age and older.
"Coronavirus is unique in that it has changed public perception on estate planning," said Esq. Principal Attorney at Jancosek Law, APC Jennifer Jancosek. "The continued uncertainty of how the virus will affect our lives and our families has led many people to seek help in preparing for whatever emergency situation may come next."
Even if people aren't worried about getting COVID-19, they are now faced with the fact that life is precious, and some illness or disease can quickly take it away. They want to be prepared just in case the worst happens.
"While the pandemic may be an uncomfortable reminder that we never know what's around the corner, things can also happen to you in non-pandemic times," said Anna Barker, personal finance expert and founder of LogicalDollar. "This is exactly why you should always have a valid, up to date estate plan."
Questions to ask before coming up with an estate plan
Before you make any changes to your estate plan now, you should ask yourself some basic, but important questions.
According to Randy Fox, founder of Two Hawks Consulting, LLC, you should ask yourself:
- What do I really want to have happen?
- Who do I want to have authority?
- If my children are minors, who do I want to raise them in my absence? Am I leaving them enough money to do that?
- Do I trust the people I've named to carry out my wishes?
- What about who comes after them?
Some other questions that may come up around coronavirus include whether or not you'd want to use life-extending equipment if your agents are close enough to make changes in case you suddenly become ill and who will watch the children while you're recovering.
COVID-19 issues to consider in your estate plan
According to Jancosek, during this time, you may also reconsider decisions regarding life-extending machinery, such as a ventilator, and stipulate that you'll allow it in your medical directive. "While your estate plan doesn't need to specifically reference the use of a ventilator, it is important to make it clear that you approve [or disapprove] of such life-extending treatment."
You also may want to reconsider whom you appointed as your medical and HIPAA agents, Jancosek said. The medical agents will make medical decisions for you if you are incapacitated and your HIPAA agents will be able to access your medical records even if you're quarantined.
Additionally, Jancosek recommended having a HIPAA waiver along with your medical directive or living will.
If you have minor children, now might also be the time to think about adding guardianship information to your estate plan. Dr. Guy Baker, managing director of Wealth Teams Alliance said, "The support and maintenance of children should be a standard part of the estate planning documents. This would include naming guardians who would care for the children if their parents are unable to do so. Language could be added to deal with the care of children while a parent is in recovery from a major illness."
Ensuring peace of mind
In uncertain times like these, an estate plan will help you take control of the future and ensure you and your loved ones are protected.
"One of the biggest things to emphasize is that no matter your age or the size of your estate, it is important to have a plan in place," said Estate Planning Attorney with Seck & Associates Jessica Kimbrell. "Now is the perfect opportunity to have estate planning conversations. Planning for 'what if' will protect you and your loved ones and will provide you with peace of mind."