Your Plan Only Works If It Is There When Most Needed Estate Planning in Times of Crisis

This is the first in a series of blog posts written in response to the Covid-19 crisis. I’ve been hesitant to write anything that could be construed as exploiting this terrible pandemic. Yet, like so many others, I’ve been looking for a way to use what I know to help. Turns out that the virus has prompted a lot of interest right now in estate planning. The anxiety and confusion that permeates everyone’s life right now is causing many people to question whether they are properly prepared for the future.

People are looking to buy more life insurance. Coronavirus fears are causing a growing number of Americans to explore making an online Will. Other media reports that the most important thing Americans can do right now is have a power of attorney in place.

This blog series will endeavor to educate readers about what I think they need to know most right now about estate planning. We aren’t going to talk about subtle niceties like using a trust to hold a timeshare or when it can be good to use the probate process. We are going to talk about the bare bones of what everyone can be doing right now to plan for when bad things happen.

This first blog post will address some actions to take when you already have done planning. If you haven’t done any estate planning yet, the next post in this series will be for you.

You’ve done your planning and have your documents. Isn’t that enough? Sorry, it isn’t.

You’ve got at least the basics we’ve been stressing, i.e. a Will, durable power of attorney, and health care power of attorney. So if you become incapacitated or die the right people can handle things. Great! But how will “the right people” find them those documents when they are needed?

The answer to that question is unique for everyone. To answer it for yourself, first consider who “the right people’ are.

Ask yourself: Who will need to have access to your documents when you are incapacitated or after your death?

At a minimum, the agent you name in your health care power of attorney will need to have access to that document to be able to make medical decisions for you. Likewise, the agent named in your durable power of attorney and the successor trustee of your living trust will need to show the right document to be able to access your bank accounts, pay your bills, and do everything else needed to handle your legal and financial affairs while you are disabled.

Your personal representative (sometimes called executor outside Colorado) or the successor trustee of your living trust will need access to your Will or living trust (preferably both) to be able to handle your affairs after your death.

Maybe there are others who should be able to access the documents, or at least copies of them. This might include your financial planner, your accountant, and your doctor. If you have minor children, the person you have nominated as guardian of your children might benefit from getting a copy when needed. There may be others, such as the administration of your assisted living facility or your life insurance agent.

What is the best way for those people to access the documents when needed?

Now that you have a list of who might need to have access to what document, formulate a plan to get them access. Maybe you’ll hold on to the originals in a safe place and let them know where that place is. Perhaps you’ll give them copies now. In your case, you might decide to let them hold on to important originals. Keep in mind that, with the exception of the Will, your documents may explicitly state that a copy is as good as an original when needed. The original Will, however, has to be produced to the court upon your death.

Should you use a safe deposit box?

Some clients fear that once they are disabled or deceased someone will access their home and perhaps destroy or hide their estate planning documents. This is most common when the Will is not favorable to a spouse or child. It can also be a concern when the power of attorney names someone other than the disgruntled family member as agent.

In this case a client may consider putting the documents in a safe deposit box at their bank. This can be a solution provided that the client ALSO adds the person who will need access to the documents as someone who can access the box. Otherwise your personal representative might find themselves in a Catch-22 situation. They can’t access the box without the Will and they can’t access the Will without getting into the box. There is a statute that can be used to get around this, but it is cumbersome and many bank officers need to be reminded of it.

In some cases, it might be just as easy to ask the agent or personal representative to take possession of your original documents now. If you decide to do that, you will have to remember to give notice if you change your documents later. Otherwise the person holding the documents may not realize the ones they have are superceded.

If you are a member of our firm’s CARePlan you will have your own online client portal. This encrypted secure account will allow you to access digital copies of all of your documents. You can share this access with someone else or use the digital copies to email copies to your trusted helpers. Just remember a digital copy cannot replace an original Will.

What other questions can we answer about legal preparation in this time of crisis? Feel free to let us know what other topics you would like us to cover.