The vast majority of vacations happen without a health care crisis, of course, but as we all know, anything could happen and tomorrow is not promised. Accidents, heart attacks, and strokes can occur at any time with devastating effects.
Sometimes people who experience a health crisis close to home still have time to react. Family members, especially next-of-kin, can be present to make decisions. There’s time to hold a conference of loved ones. Attorneys and financial planners who have known the family for years can, if the family is fortunate, be brought in to help execute key documents, update a will, update power of attorney documents and ensure your wishes are known and respected.
But when you are away from home, things often play out very differently. It is much more probable that you and your loved ones will not have the time or resources to take care of these important end of life planning steps.
Ideally, you will have taken these critical steps already, and all you need to do is keep them updated as circumstances change. But if you’re planning on being away from family and loved ones for any period of time, updating your estate planning document is especially important.
- Check life insurance beneficiaries. Are all the beneficiaries on your current life insurance policies still relevant? Have there been divorces, deaths, births or adoptions that make it necessary or desirable to change primary beneficiaries? How about secondary or contingent beneficiaries? Have one or more beneficiaries reached adulthood? Can you scrap a trust arrangement?
- Check retirement fund beneficiaries. Many people fail to assign named beneficiaries to their IRAs, 401(k)s, annuities and other retirement vehicles. But it’s important to do so in order to ensure that you are preserving the options your heirs have to manage any inheritance in the most tax efficient way possible. It’s also vital if you have stepchildren or other non-traditional family arrangements – otherwise you may accidentally disinherit someone despite a lifetime of love, loyalty, affection and support. Stepchildren and long-time romantic partners who are not married to you are especially vulnerable to accidental disinheritance.
- Update your will. Have you acquired or lost property since you last signed a last will and testament? If you lost property, or spent down assets, are the divisions to heirs specified in the will still equitable? You may want to make adjustments to the will, or purchase life insurance to equalize benefits among heirs, or both.
- Verify your executor. Is the planned executor for your will still appropriate? Is he or she capable and willing to take on the tremendous responsibility of executor of a will?
- Check your health care power of attorney. If you should become incapacitated and unable to make your own decisions requiring your health care, whom do you want making these decisions on your behalf? If you don’t establish a health care power of attorney, it will devolve to your next of kin, or in a worst case scenario, to the courts, with you and other family members powerless to look out for your best interest. Naming a health care power of attorney helps ensure your wishes regarding end of life care will be respected.
- Establish a living will. This living will provides your health care power of attorney and health care professionals with your guidance about what you want to happen in the event you are incapacitated and they must make some difficult choices on your behalf. Do you want to be an organ donor? How long do you want to be kept on life support if chances of recovery are next to nil? Do you want health care professionals to refrain from CPR or heroic measures to revive you if your quality of life is likely to be poor? Your living will is a legal document that will help your wishes be known.
- Homestead declarations. In some cases, you may want to sign a homestead declaration. This may help protect some home equity for heirs in the event of judgments that arise after the declaration is signed – such as awards for lawsuits involving unpaid medical bills. Speak with your attorney about homestead exemption laws in your state.