There are times when life throws unexpected curves.
If you become incapacitated, you won’t be able to manage your own financial affairs. Many are under the mistaken impression that their spouse or adult children can automatically take over for them in case they become incapacitated.
The truth is that in order for others to be able to manage your finances, they must petition a court to declare you legally incompetent. This process can be lengthy, costly and stressful.
If you want your family to be able to immediately take over for you, you must designate a person or persons that you trust in proper legal documents so that they will have the authority to withdraw money from your accounts, pay bills, take distributions from your IRAs, sell stocks, and refinance your home.
In addition to planning for the financial aspect of your affairs during incapacity, you should establish a plan for your medical care. The law allows you to appoint someone you trust to make decisions on your behalf about medical treatment options if you lose the ability to decide for yourself. You can do this by using a durable power of attorney for health care where you designate the person to make such decisions.
Lifetime Planning: Statutory Updates to Durable Powers of Attorney
South Carolina's Legislature included an eighth article to the South Carolina Probate Code, which specifically relates to Durable Powers of Attorneys. This article will go into effect January 1, 2017. While it reaffirms the majority of the already existing law, there are some key changes.
Lifetime Planning: Naming Agents in Powers of Attorney
In your Durable Power of Attorney, you can name one or more agents to act on your behalf for financial matters, in the event of your incapacity. This can be one of your most important decisions and can save your family a lot of trouble and expense, in the event of your incapacity. Who should you name?
Lifetime Planning: Use Caution with Joint Accounts
Many believe a joint account is a good substitute for a Power of Attorney and for a Will. While joint accounts are useful in certain circumstances, they can have dire consequences if not uses properly. Adding a loved one to a bank account can expose your account to the loved one's creditors, as well as Medicaid.