The Essential Documents Your Aging Loved Ones Need

 In Family Legacy & Philanthropy, Parents & Spouses

The best time to get involved in your aging parents’ affairs is early on, long before your loved ones are in ill health or their affairs are in trouble.

Start with a simple inquiry. Ask when their estate plan was last reviewed and updated. If they have not seen an estate planning attorney in the past five to ten years, do not know where their documents are located, or cannot remember the last time they made updates, they are likely to be behind on some of the latest documents, laws, taxes, and thinking applicable to their situation.

Next, find out where their important financial and legal records are kept. This is also a good time to find out and respect their wishes about who is to know what.

There are certain essential documents – both medical and financial – they should have in place.

Medical Documents

If your aging loved one is going in for major surgery, then it may be a good time to locate the Health Care Proxy, the Living Will or Medical Directive, as these should be talked about and signed.

The Health Care Proxy (also called a durable power for health care) gives the power to make medical decisions – care choices, surgeries, rehab, medications, hiring and firing physicians, living facilities – when your relative can’t.

A HIPAA release is the medical privacy form that allows you to access their medical information to make decisions and be present for medical discussions and make inquiries about their health.

A Living Will is a statement to the effect that your relative does not want artificial supports to keep them alive if there is no hope of their recovery and their quality of life is so poor that they would rather be let go than given more treatments or support.

A Medical Directive is often more specific than a living will about procedures, treatments, medications and diagnostics that your relative may or may not want if they are in a comma, terminally ill, unable to recognize people or communicate, and cannot speak for themselves.

A MOLST (Medical Orders for Life Sustaining Treatment) is the form officially recognized in your state (replacing the DNR – do not resuscitate form in most cases), signed by your relative (or the health care proxy) usually when very ill, co-signed by a doctor, physician’s assistant or nurse practitioner, stating preferences regarding treatment at the end of life. This step can be helpful to make sure that medical personnel are on board and have a common understanding with your relative about end of life care.

Power of Attorney

If your aging loved one seems to be getting forgetful, or is lacking confidence in their ability to balance their checkbook, it may be time to make sure a Durable Power of Attorney is signed and up to date. It is best if a power of attorney is not older than three to five years. Some financial institutions will not accept powers that are older than three years. It may be necessary to re-do powers and to check with financial institutions on what they will accept. By law, all powers should remain effective indefinitely, but as a practical matter, financial institutions create and enforce their own rules.

Financial Documents

Once you have dealt with medical concerns, make sure the following financial documents are in place. Keep in mind, the only way to know for sure your aging loved ones are completely covered is to do a full review with an estate planning attorney.

A Current Will. A proper will names an executor (or “personal representative”), disposes of particular assets (if desired), special gifts (if desired) and the “rest and residue” of the estate.

A Living Trust. This is an agreement for the holding, managing and distributing of assets. Also, specify whether the trust owns their assets.

Beneficiaries. Have they named beneficiaries properly on all life insurance, annuities, and retirement accounts (IRAs, etc.)?

Real Estate. Do they know whose names are on the deeds to their real estate? Do you know where these documents are located?

Prior Estates. Have the settled fully the estate of their deceased spouse (if applicable)? How do they know for sure?

Long Term Care. Do they have a plan for paying for long term care at home, in an assisted living facility or nursing home? Are they self-funding, using long term care insurance, or expecting to qualify for Medicaid? If the latter, do they know the requirements in order to qualify?

Final Tips

Present yourself as a resource to make this process with your loved ones go as smoothly as possible. These can be touchy and confusing subjects, but with the right prep, you can help your loved ones through a difficult time.

For more about talking to your loved ones about their estate plan, review our overview on how to talk to your loved ones about their estate plan. Also, read our checklist with 10 timeless tips for your estate plan.

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