One of my family members recently talked with me about a will and other documents that are necessary for not only a smooth transition of her property at her death but also to appoint others to take care of important matters if she was incapacitated in some way.

An incapacitating injury or disease may mean that important decisions do not get made unless appropriate parties have been designated and given that power in the event a doctor deems a person unable to make decisions themselves. As a group, these documents are called advance directives.

“Advance directives are written, legal instructions regarding your preferences for medical care if you are unable to make decisions for yourself. Advance directives guide choices for doctors and caregivers if you’re terminally ill, seriously injured, in a coma, in the late stages of dementia or near the end of life. Advance directives aren’t just for older adults. Unexpected end-of-life situations can happen at any age, so it’s important for all adults to prepare these documents.”[i]

Medical or Health Care Power of Attorney and Living Will

A health care power of attorney is a type of advance directive in which you legally name a person (agent) to make health related decisions for you if you are unable—the agent acts in your place. The agent is important because he/she may be called upon to use his/her judgment in cases in which the choice is not clear cut. One of my sisters recently fell when hiking and fractured her hip. If she had not been able to make a decision about surgery herself, her health care power of attorney would have been called upon to make the decision for her.

“Your health care agent will work with doctors and other health care providers to make sure you get the kind of medical care you wish to receive. When arranging your care, your agent is legally bound to follow your treatment preferences to the extent that he or she knows about them. To make your wishes clear, you can use a second type of health care directive — often called a “health care declaration” or “living will” to provide written health care instructions to your agent and health care providers.”[ii] It includes such things as the measures you want to be taken to keep you alive and comfortable.

States vary in their description of this type of agent, the forms needed to appoint an agent, and the definitions used to describe the powers, so it is important to check the requirements in your state. You can find a state-specific living will form on the National Hospice and Palliative Care Organization website or your state’s Department of Health website. You can also ask your doctor or hospital for these forms.

It is important, of course, to get permission from your preferred agent before you appoint her/him and to then provide her/him with a copy of your directives. Give your selection of health care power of attorney some thought and let other close family members know who you have appointed so they know who to contact if a situation arises. Don’t forget to check with your primary physician to see if their office requires a copy of your documents for your records.

HIPAA Authorization Form

The Health Information Portability and Accountability Act (HIPAA) provides legal standards for keeping a person’s health information and records private. It is illegal for medical professionals to share any details about your health unless you give your written consent. HIPAA authorization is a simple yet important document, especially for family caregivers. It authorizes the doctor to keep approved family members in the loop regarding your medical status and billing information. The form only takes a moment to complete, and every doctor’s office should have blank ones on hand for patients.[iii]

Financial Power of Attorney

Like the Medical Power of Attorney, this is a legal document that grants the authority to a trusted agent to make financial decisions for you. It can become effective immediately and stay in effect until you die; or the power of attorney can be triggered upon a certain event—for example, if you can’t express your desires or make decisions due to incapacitation. A financial power of attorney may also be appointed for a particular transaction or for a limited period, for example while you live or work outside the United States.

The role of a financial power of attorney dissolves upon your death unless you’ve written specific language that names the agent the trustee of your trust or executor of your will. The designation of a financial power of attorney does not change ownership of your assets.

Appointment of a Financial Power of Attorney is also an important decision as that person may be called upon to take care of all your financial affairs—everything from everyday transactions such as writing checks and paying bills to much bigger decisions such as whether to sell property. You want to select someone who you trust will have both your and your beneficiary’s best interest at heart.

Again, let your close family know who you have appointed as your financial power of attorney so there will be no hesitation or question if it’s use becomes necessary.

Last Will and Testament

A will is a legal document that details your final wishes regarding the care of your dependents, as well as the distribution of your assets after your death. Why should you have a will?[iv]

  • You can be clear about who gets your assets. You can decide who gets what and how much.
  • You can keep your assets out of the hands of people you don’t want to have them (like an estranged relative).
  • You can identify who should care for your children. Without a will, the courts will decide.
  • Your heirs will have a faster and easier time getting access to your assets.
  • You can plan to save your estate money on taxes. You can also give gifts and charitable donations, which can help offset the estate tax (if applicable).

As part of your will, you will designate the person who will serve as executor or executrix of your estate. The executor passes on inheritances and pays off debts per your wishes and any applicable laws.

Any of your assets, such as insurance policies and company and Individual Retirement Accounts with beneficiary designations, transfer directly, outside your will, so they are not part of your estate. Did you know that beneficiaries may be designated for your vehicles or your home? If you choose to name a beneficiary for those assets, make sure they are properly recorded with the designated agency. Also, it is very important to keep your beneficiary designations up to date so that unintended parties (e.g., a former spouse) do not inadvertently inherit your property.

For more complicated financial situations it may be a good idea to have a discussion with your financial advisor and attorney to see if it makes sense for you to draft a trust or other legal documents to make your intentions clear.

Other Documents

If you know that at some point in the future you will serve as executor or executrix of an estate, it might be a good idea to review, or at least know where to find, the additional documents listed below: (Not all are applicable to every situation.)

  1. End of life instructions
  2. Birth certificates
  3. Deeds to the home (and other property)
  4. Bank account information
  5. Financial account(s) information
  6. Insurance policies
  7. Veteran’s discharge papers
  8. Death certificate of spouse, if applicable
  9. Divorce decrees
  10. Citizenship papers, if applicable
  11. Retirement accounts
  12. Debt documentation
  13. Vehicle titles

No matter your age, directing who will have the right to inherit your real property and other assets is important, especially if you have dependents. There are so many things to consider: age and maturity of any potential beneficiary, any philanthropic intent, continuance of family business, tax consequences, etc. As you go through life, your circumstances will change so it is also a good idea to review your documents regularly and update them promptly for any major life event—marriage, death, divorce, birth of children, etc.

Even though the information in this blog is general in nature, it may not be applicable to your situation. Please discuss your specific needs and desires with a trusted financial or legal advisor.

~Bev Bowers, CFP®


Legal Notice: This document is intended to be informational only. Beverly Bowers does not render legal, accounting, or tax advice. Please consult the appropriate legal, accounting, or tax advisor if you require such advice. The opinions expressed in this report are subject to change without notice. The information in this report is from sources believed to be reliable but are not guaranteed to be accurate or complete. All publication rights reserved. Use of this material is subject to the Copyright restrictions described on
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark and the CERTIFIED FINANCIAL PLANNER™ certification mark in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.