Dear Jonathan: I went to see a lawyer because I wanted a simple will drawn up. By the time I was done, not only did I have a will, which was not the least bit simple, but I had a financial durable power of attorney, a health care power of attorney and living will, a trust, and a rather large bill from the lawyer. I was shellshocked. Do I really need all of these documents or was I scammed by the lawyer?
Jonathan says: Without knowing anything about your personal circumstances, or what your objectives were when you went to see the lawyer, it is hard to give you a specific answer as to whether you were sold a bill of goods by the lawyer. Generally speaking, however, a will, a financial durable power of attorney and a health care durable power of attorney are estate planning staples that everyone, regardless of their circumstances, should consider having.
A will allows you to name, and as a result control, who is to receive your estate upon your death, and I am assuming that was your original purpose for wanting to prepare a will.
A financial durable power of attorney is a power of attorney which allows you to name another to act for you if you cannot act for yourself regarding your financial and property matters. Although it’s primary purpose is to allow someone to act for you if you cannot act for yourself due to a disability, it can also be drawn in a manner so that it can be used anytime even if you are not disabled.
A health care durable power of attorney is a power of attorney which allows you to name another to act as your patient advocate in the event you cannot act for yourself regarding your personal and health care matters.
Both financial and health care durable power of attorneys are critical and important documents to have because should you become disabled without having them in place, there would be no one with legal authority to act on your behalf. In that instance, someone would have to petition the probate court in your county of residence for the purpose of having a guardian, for your personal and health care matters, and a conservator, for your financial matters, appointed on your behalf. By having these durable power of attorneys in place prior to becoming disabled, you avoid having to involve the court for the purpose of having a guardian and a conservator appointed on your behalf.
The other two documents you mentioned are a living will and a trust. The living will is a document which allows a person to indicate what type of medical treatment is to be administered in the event that person is terminally ill or in an irreversible coma, i.e., brain dead. It is typically prepared in conjunction with a health care durable power of attorney. If you don’t care about leaving instructions as to what type of medical treatment you are to receive in either of those instances mentioned above and you are okay with your patient advocate making those decisions on your behalf, then it is not necessary to have a living will. In my experience, most people want to relieve their patient advocate from having to make those types of decisions, so they prepare a living will.
Whether a trust is called for is determined by a variety of different circumstances. Typically, a trust is recommended if someone has minor children and there is a desire for the trust to invest, manage and control the children’s inheritances until they reach a certain age, at which point those inheritances can be distributed out to them. Another reason a person sets up a trust is so that his or her estate will avoid probate upon his or her death. By re-titling an individual’s probatable assets into the name of their trust, those assets will avoid having to be probated when the individual dies.
There are various other reasons why a lawyer might recommend a trust; without knowing your particular circumstances, it is impossible for me to tell you whether a trust should have been included as part of your overall estate plan.
Hopefully, the information I have provided will give you a better understanding of the purposes of those documents which were prepared for you and why they were included as part of your estate plan.
If you have further questions or concerns as to why your lawyer recommended and prepared these documents on your behalf, I would encourage you to call him or her and discuss those concerns.
Jonathan J. David is a shareholder in the law firm of Foster, Swift, Collins & Smith, P.C., in Grand Rapids, Mich.
