Two Legal Documents Every Adult Should Have

Ready for college? Starting a career? Or have you been ‘at it’ for a while?

The two legal documents every adult should have are: a Healthcare Power of Attorney (and/or Healthcare Directive) and a General Power of Attorney. 

As an estate planning law firm, we understand many Americans have taken the “I’ll get around to it” approach to their own estate. However, everyone over the age of 18 should strongly consider implementing a current Healthcare Power of Attorney (and/or Healthcare Directive) and a General Financial Power of Attorney.

This article will briefly outline what these documents accomplish and then address why they are so important (and easy) to put in place. 

Healthcare Power of Attorney

A Healthcare Power of Attorney is a document that tells the world who has the power to make medical decisions on your behalf if you are incapacitated. Incapacitation comes in many forms. It could mean someone was in an accident and cannot currently communicate to their healthcare professionals medical decisions. It could mean someone is in a coma. It could mean someone has lost mental capacity from illness or dementia. Regardless of how incapacitation occurs, proactively appointing a person to this role alleviates costly legal battles between family members.

Healthcare Directive

A Healthcare Directive is a document that tells medical professionals your wishes concerning treatment prior to becoming incapacitated. Typically, this document will be used to direct (hence the title “directive”) medical professionals to withhold, withdraw, or otherwise avoid certain medical treatments or procedures when someone is in a seriously grave medical condition.  This document also serves as a way of giving your agent under the Healthcare Power of Attorney, some guidance as to your end of life wishes concerning medical treatment.

General Financial Power of Attorney

A General Power of Attorney is a legal document that grants your agent (the person you appoint) the power to handle your financial affairs. For healthy individuals, this grant of power is typically what we lawyers call a “springing” power. A springing power is one that does not actually give the power to your agent until some future event, typically incapacity. Alternatively, the General Power of Attorney could be effective immediately.

The agent appointed under a General Power of Attorney has broad power to access your financial affairs. For example, the agent is sometimes granted power to:

1. Access to and management of financial accounts (including withdrawals);
2. Pay bills and deal with service providers (i.e. terminate utilities, add services, etc.); 
3. Communicate with government officials concerning benefits, social security, and the IRS; and
   
4. Do or perform many other acts on behalf of the grantor.

As you can imagine, giving someone this broad scope of authority does not come without risk of abuse. Care should be taken in both drafting the powers granted, as well as selecting the person(s) who will be acting as agents.

Why Make These Decisions Now?

At 18 years of age, we become adults under the eyes of the law. This means we can make life changing decisions, we can enlist in the military, and we can enter into contracts. It also means that if we are incapacitated, our loved ones may have trouble finding ways to help us with our ordinary daily affairs. 

From the medical side of the house, under law both parents will typically have joint authority and legal right to make medical decisions for an unmarried adult child (who does not have adult children). If those parents disagree on treatment options, the dispute is likely not to be resolved without a court proceeding. Naming a trusted person, parent, sibling, loved one, or otherwise to make these decisions ahead of time may avoid lengthy delays in treatment or end of life decisions. 

On the financial side, appointing an agent to act on your behalf if you become incapacitated makes it possible for someone to pay your bills, apply for government or insurance programs, and handle other important financial decisions until you regain capacity or otherwise. 

Avoid these issues by creating the two legal documents every adult should have.

Due to the sensitive nature, and potential for abuse, of these documents we highly recommend you work with your estate planning lawyer to navigate and implement them. If we can be of assistance, please contact our office at (636) 352-1222 or here. 

If you simply cannot make it to an attorney, Missouri citizens can download the state sponsored Healthcare Power of Attorney and/or Healthcare Directive by visiting the Missouri Bar Association’s website here. We cannot stress enough how much every adult should at least have this form completed.