Two documents that no couple should be without
If you were incapacitated
in any way, and someone else had to make important financial or health-related decisions for you, who would you choose? The next important question to ask yourself is if that person would be legally able to step in and make these decisions.
It is important for unmarried couples to realize that their partner doesn’t automatically have the same legal rights that married couples do, even if they’ve been living together for many years. In order to ensure that your wishes are carried out in the way you want and by whom you want, you need to set up two important documents: a durable financial power of attorney and a healthcare proxy (also known as a power of attorney for healthcare).
Setting up a healthcare proxy is the most important step that unmarried couples can take to protect their ability to speak on their partner’s behalf in medical situations. Without these documents, you or your partner might find yourselves unable to take part in important decision making that can affect you both. Furthermore, if you aren’t established as each others healthcare proxies, you may not even be allowed to visit at the hospital since you aren’t legally family.
Setting up a financial power of attorney is also a critical step that unmarried couples need to take. Couples that have been together awhile tend to combine finances, especially if they live together. If your partner becomes incapacitated, you may not be able to make financial decisions on your partner’s behalf, even if those decisions have a dramatic impact on your own finances.
“A court may grant a family member authority to make decisions about your partner’s finances,” states Sandra Block from Kiplinger’s Personal Finance.
You may assume that your partner’s family will respect your relationship and allow you to have a say in the decision making process, but that is a risky prospect to gamble upon. Furthermore, times of emotional stress can make people act in unpredictable ways. So even if your partner’s family tells you that they will defer to your opinion in medical or financial situations, you can’t depend upon them acting in a predictable manner and not changing their mind.
Even if you do have a power of attorney set up, if you haven’t read the conditions carefully, it may not include everything you think.
“When it comes to powers of attorney, just because you have one does not mean that it covers both healthcare and financial decisions, unless it specifically says so,” according to Investopedia.
“An estate-planning lawyer can help you draw up power-of-attorney documents…” states Sandra Block. “Some banks and brokerage firms won’t honor power-of-attorney documents unless they meet certain conditions, so make sure the form you use will be accepted by your financial institutions.”
It is also important to make sure that your family knows who you have selected as your financial and healthcare power of attorneys, so that there is no delay in seeking that person out in the event of an emergency. Also, relevant documentation should be in a safe and easily accessible location, with multiple copies in convenient and safe locations.
Once you set up these important documents, you will feel much safer knowing that you and your partner will have their rights and wishes protected.
Used with Permission. Published by IMN Bank Adviser Includes copyrighted material of IMakeNews, Inc. and its suppliers.