One of the most important parts of estate planning is deciding what property you will leave your heirs. However, equally as important is planning for how you will manage your personal and financial life as you age. The reality is that as we get older our health often fails and we require an increasing amount of heath care as well as assistance with everyday living activities such as personal care and finance. Thus, in addition to making a last will and testament, when developing a comprehensive estate plan it is also wise to consider tools that will ensure that should you become incapacitated so that you cannot communicate or take care of yourself, you will be taken care of according to your wishes. The branch of law that deals with legal issues related to aging is referred to as elder law. Because of the complexities of elder law as well as estate planning, you should consider contacting a Manhattan Elder Law Lawyer experienced with legal issues that are important to the older population who will be able to help you understand the documents that you will need to ensure that your long-term personal and financial goals are reached.
There are several estate planning tools that are designed to contemplate your future personal and financial needs and issues that are more likely to develop as you age. A living will allows you to make your wishes known as to what treatments you would or would not like to receive should you become incapacitated and are terminally ill. Both a health care proxy and a durable power of attorney for finances allow you to appointment a trusted family member or friend to act for you with respect to your health care or your finances if you become incapacitated and cannot take care of these matters for yourself. Without a living will, health care proxy, or durable power of attorney for finances, the court may intervene and appoint a conservator to make decisions for you. Making a plan for your long term care will make the transition to assisted living easier and less of a financial burden. A last will and testament will allow you to pass on your assets to your loved ones.
While many of these issues that commonly associated with aging may seem if they are not relevant to you right now, you should consider planning now, even if you are relatively young.
Living WillA devastating illness can strike at any time. As we age it is more likely that we may suffer from devastating illnesses or accidents in the home from which recovery would be difficult. With a living will you can leave instructions for your doctors and family members as to which types of treatment you agree to have should you end up with a condition that leaves you mentally incapacitated and from which you will likely not recover.
Living wills detail the type of medical treatment and life-prolonging measures you want or do not want. For example, your living will might specify which if any life-sustaining treatment or measures you want such as CPR, artificial nutrition, dialysis, or surgery. You can also give details as to whether or not you would like to receive antibiotics or pain medications. You can specify your preferences regarding organ donation, such as if you would like your organs or tissue donated, or if you want only certain organs or tissue donated. You can even state where you would like your organs or tissue to go: for transplant, research, education or therapy.
Health care proxyA health care proxy is a legal document in which you nominate another person, referred to as your agent, to make health care decisions for you or in the event you cannot. It is distinguishable from a living will in that a health care proxy empowers an individual to make decisions for you while a living will is a set of instructions for your health care agent, doctor or someone else to follow. Under New York’s Public Health law your agent’s authority to make health care decisions begins when your doctor determines that you have lost the capacity to make decisions for yourself. N.Y. PBH. LAW § 2983. This means that your agent is not permitted to begin to make decisions for you simply because you may be very ill, or because you may be unconscious. The doctor must document your condition in your medical records before your agent can act on your behalf.
You can give your agent general authority to make health care decisions, or you can be very specific about what authority your agent has. In either case your agent is required to make decisions that are consistent with your wishes, your religious and moral beliefs, and that are in your best interest. Examples of the decisions that you can give your agent the authority to make in your health care proxy include whether you can be given CPR, artificial respiration, IV or tubal nutrition and hydration, medication, or dialysis. You can also give your agent the authority to approve organ transplantation or other surgical procedures.
A health care proxy is flexible such that you can give your agent different authority depending on your condition. For example, you can give one instruction to your agent if you are terminally ill, a second instruction if you are in a coma with no hope of recovery, and a third instruction if you have brain damage that makes you unable to recognize people and there is no hope that your condition will improve.
With a health care proxy you can give your agent the authority to donate your organs or tissue. This means that you can allow your agent to authorize the donation of your organs and tissues without limitation, or you can give more limited authority and specify which organs and tissues you want donated.
If you give your agent the authority to withdraw or withhold life-prolonging treatment such as CPR, dialysis or artificial hydration and nutrition, before your agent can exercise that authority, New York law requires that a second doctor confirm that you lack the capacity to make health care decisions. N.Y. PBH. LAW § 2983 (1)(a)
While your agent's decision will typically be considered final, you family or the health care facility can object to your decision and request that a court intervene. Your proxy's decision will be put on hold until a judge listens to arguments on both sides and makes a decision.
Deciding who you will name as your health care agent is an important decision, and you should consider only those who your trust and who are mature and responsible. People typically select a spouse, significant other, adult child, sibling, or a close friend. The person you select should be trustworthy and should know you well. The person should be someone who you know will respect your decisions even if that person does not agree with your decisions. You should discuss it with the person who you plan to name as your agent before you execute the health care proxy to make sure the person you select is comfortable being your agent and to make sure he or she understands your preferences. It is also a good idea to name a second person as a your successor agent in case the person who is your first choice is unable to serve as your agent.
Another important consideration is where your agent lives. If you become seriously ill, your agent may need to make decisions for you over an extended period of time, requiring your agent to be able to make frequent visits to the health care facility. For this reason a person who lives thousands of miles away may not be a good choice.
New York law requires that your health care agent be at least 18 years old. The person cannot be your doctor unless your doctor is also your relative. The person cannot be an employee of the facility where you are admitted unless they are also a relative or unless you appointed them before you were admitted. N.Y. PBH. LAW § 2981
For a health care proxy to be valid you must sign it in the presence of 2 witnesses who also must sign it. Your agent and your successor agent are disqualified from serving as a witness. N.Y. PBH. LAW § 2981
Durable Power of Attorney for FinancesA durable power of attorney is similar to a health care proxy in that with it you give another person the authority to act for you while you are incapacitated. Instead of making health care decisions the person you name in the power of attorney, referred to as your agent or attorney-in-fact, will have authority to make financial decisions for you.
It is up to you to decide what authority to give your attorney-in-fact. For financial decisions, you can be very specific as to what authority you chose to give your attorney-in-fact. For example, with a power of attorney for financial matters, you can grant someone the authority to buy or sell real estate, manage your property, manage your brokerage account, pursue claims, manage your bank account, run your small business, buy insurance for you, manage your retirement benefits or military benefits, provide financial support to your spouse and children, or pay your taxes.
ConservatorshipIn New York a conservatorship is called a guardianship. If a court determines based on a functional assessment that you are unable to take care of your finances or independently perform activities of everyday living, the court may place you in a conservatorship and appointment someone to take care of your affairs for you.
New York policy requires that should a conservatorship be required, the court will look first to close family members to fill the role of conservator, such as your spouse, adult children and siblings. After considering close relatives and other family members, if the court concludes that there are no relatives suitable to fill the role as conservator the court will appoint a non-relative such as a public conservator or a professional conservator.
The conservator will remain in place as long as the court determines that you need someone to handle your affairs. If your medical condition improves enough so that you are able to resume taking care of your affairs, the court will end the conservatorship. NY MHY LAW § 81.36. Otherwise, the conservatorships remain in place until you pass away.
A conservator can be appointed to take care of your finances or to take care of your day-to-day well-being and personal needs. In many cases, particularly if you are mentally incapacitated, the court will appoint a conservator to handle both your finances and your well-being. Referred to as a "conservator of the person," a conservator who is appointed to make decisions about personal matters will make decisions about your housing, healthcare, and other aspects of your personal care. If necessary, the conservator may decide that it is in your best interest to live in an assisted living facility or a nursing home. A "conservator of the estate" makes decisions about your finances. He or she will manage your assets, pay your bills, make investments, and collect income. The court will require the conservator of the estate to keep detailed financial records and regularly report to the court about the status of your finances.
Using advanced planning you can execute a health care proxy or a durable power of attorney to appoint someone you trust to handle your finances in the event you become incapacitated.
Long Term Care PlanAnother significant issue that you should consider as you plan is your long term care needs. Even if you never become so mentally incapacitated that you require another person to take care of your finances or make health care decisions for you, your health may fail to the extent that you are no longer able to live on your own. You may have to move into an assisted living facility, a nursing home, a memory care facility, or a hospice. You may need to reside in such a facility for years. They are quite expensive and without proper planning, could eat up all of your savings. Even if your assets are substantial, with careful planning using such asset protection tools as a trust you will be able to receive the care that you need without spending all of your assets.
Last Will and TestamentA last will and testament is the most common estate planning document. It is used to leave your loved ones your assets after you pass away. The main advantage of making a will is that a will allows you to control what will happen to your property after your death. You can decide to leave your property to family members, or you can leave it to close friends. You can even decide to disinherit someone. Furthermore, you can control how a beneficiary receives the property. If you have a relative with who is disabled, with a will you can leave that person's inheritance in a special needs trust. If you have a pet whose care you want to ensure, you can leave the pet so someone you can depend on and set up a pet trust for its care.
If you do not leave a will, instead of the people who you want to receive your property receiving it, people who you do not like or perhaps do not even know may receive your property. Under New York's laws of intestate succession, only blood relatives in a specific order for priority will be able to receive your property. This could mean that your uncle who you have not seen in years could end up receiving a share of your estate. Or the niece who you never got along with may end up being pleasantly surprised to learn that she just inherited your house. This is a surprise that you, on the other hand, would want no part of. Another unintended consequence of you not leaving a will is that if you have children that are still minors when you pass away, they may end up being raised by that same niece that you do not get along with. If you do not name a guardian in your will the court will name a guardian. The court will first seek a relative who is qualified and willing to serve. If no qualified relative is available, the court may appoint a public guardian.
To learn more about the how to protect your assets, how to plan for your long term care, how to plan for possible future mental incapacity and how to retain control over how your assets are distributed once you pass away, contact the staff at Stephen Bilkis & Associates, PLLC. We have years of experience helping both older clients and younger clients develop comprehensive estate plans that reflects there individual goals. Contact us at 800.696.9529 to schedule a free, no obligation consultation regarding your estate plan. We serve individuals throughout the following locations: