4 Legal Documents Lawyers Say You Should Have (& 2 More That Parents Need)

When it comes to ensuring that your life affairs are in order, it’s – regrettably – necessary to have ownership of a few legal documents to ensure that the best possible outcome arises out of any potential emergency situation.

As part of a home management binder, each family, couple or individual should have a section dedicated to housing their legal documents, so that they’re easy to locate quickly in emergency – by you, or, more likely, by a member of your family, or a close friend.

Here are the 4 legal documents that everyone should have in their home management binder:

Financial power of attorney.

In the event that – for some reason – you can’t take care of your finances, such as if you’re hospitalized, financial power of attorney legally grants someone close to you with the right to govern your financial affairs.

These affairs can include: ensuring your incoming checks are deposited into your bank account, investment management, property finance management, paying your bills and more.

When it comes to choosing the ‘agent’ to carry out your financial needs in such an event, as well as being someone close to you, this person should be trustworthy, fair, and reasonably financially savvy – so they actually have the capability to carry out the tasks that your finances require.

Healthcare power of attorney.

Much like the financial power of attorney document, the healthcare power of attorney grants a particular person with the right to make choices on your behalf with regards to your healthcare, becoming your healthcare proxy if you are unable to make these decisions for yourself.

These can include decisions about whether you undergo surgery, giving consent (or not) for certain procedures, and even choices pertaining to life and death.

Your healthcare power of attorney agent should – likewise – be someone you trust to make the best decisions for you in a medically dire situation; usually this job falls to a spouse or close family member.

Advance medical directive (living will).

A living will, likewise, is something that is referred to in the event that you’re unable to express your medical wishes, such as if you’re permanently unconscious, or you’re in an equivalent state where you no longer have the capability to make decisions about your life.

A living will/advance medical directive provides answers to the questions that medical professionals and your family would want to know, should such a tragic event take place, such as which procedures you’d want, and which you wouldn’t, including whether to switch off your life support.

Together with your healthcare power of attorney agent – who will act as your voice in the hospital – an advance medical directive will ensure that your wishes are carried out while you’re alive.

Last will and testament.

Hardly in need of an introduction, your last will and testament – more commonly known as, simply,  a will – should clearly state how you want your wealth and assets to be distributed after your death, which will be helped along by an ‘executor’ of the will, who will ensure this process runs smoothly.

This executor can also be – and often is – a beneficiary named in your will, such as your spouse or child.

To ensure that your will is the best it can be – leaving minimal confusion and mess behind for your family and other beneficiaries to untangle – you should have a will executed by an attorney who specializes in estate planning, in order to ensure that you obtain the best will for your unique situation.

And here are 2 more legal documents which are essential to have if you’re a parent:

Legal guardianship.

If you’re a parent, you might think that naming people in your will who will become responsible for your children in the case of yours and your spouse’s demise is enough to ensure the smoothest transition for your children, in the event of your passing.

In a legal guardianship document, parents will have the opportunity to name ‘temporary’ and ‘permanent’ guardians. For example, if the ‘permanent’ guardians you have in mind live on the other side of the country, in a different country, or are unable to be reached when your children are first left parentless, you need an intermediary to look after your children in the short-term.

While the necessary arrangements are made for them to be installed to their permanent home, the ‘temporary’ guardian – a.k.a. the first responder guardian – will take care of your children; this ensures that your children don’t get taken into custody by the authorities.

A trust.

In the event of your death, while your children are still minors, it’s highly advisable to set up a trust, which ensures that your children are looked after financially after you’re gone.

Oftentimes this doesn’t just mean they have ready access to money at any given time – in fact, it’s about ensuring that your children receive the necessary funds when needed, without overwhelming them with an enormous sum of money once they turn eighteen.

A trust provides a safe, protected place where your wealth can stay, and which your kids can gain access to if they need it, or if they’re at a time in their life where it would truly benefit them. You can choose a trusted individual to ensure that this money stays protected, and who can distribute it to your children when they need it, and when they feel they’re mature enough to receive a substantial sum.

Having these legal documents – and keeping them in a dedicated section within your home management binder – is crucial to ensuring that your family stays protected, and that your wishes are adhered to in the event of an emergency, with regards to finance, healthcare and your children.

 So, make sure to add them to your home management binder, to be prepared for every eventuality.

About the Author: This post was written by Jay Pink an estate planning and business lawyer based in Modesto California. If you are a California resident and have other related legal questions about your state feel free to reach out to him.