Planning Directives

Almost everyone who needs a will should also have planning directives. These documents, known as powers of attorney, letters of instruction, and living wills, provide guidance about your wishes for:

Medical care
Financial management
Distribution of your personal property (any property that isn’t real estate)
Other instructions not covered by wills

Though not all states honor all directives, directives nonetheless provide valuable guidance for your executor and family members. Always have a lawyer prepare these documents for you. It usually costs about $100–$300 per directive (powers of attorney, living will, and so forth).

Powers of Attorney

A power of attorney allows you to name a person, called an agent, who can act for you in certain circumstances. Powers of attorney are called durable powers because they remain in effect until you revoke or cancel them. There are two primary types of durable powers of attorney:

Durable general power of attorney: Names an agent who can make decisions for you as if he or she were you. The agent can sign your checks, sell your investments, and access and change your accounts. General power of attorney typically comes into play only if you’re totally incapacitated.
Durable limited power of attorney: Names an agent who can make decisions for you in specific situations. You might limit a power of attorney to allow someone to act on your behalf for financial transactions—for instance, allowing your spouse to sign your checks or sell your interest in a jointly owned property. Durable medical power of attorney is a type of limited power of attorney that allows someone only to make medical decisions on your behalf if you’re incapacitated.

Living Wills

A living will is a document that states in advance the type of care that you would like to receive if you become terminally ill and can no longer express your wishes, such as after a stroke or catastrophic accident. Unlike durable medical powers of attorney, a living will provides guidance to medical personnel for specific situations but does not authorize a particular person to make decisions for you.

Note that medical personnel are not required to follow the wishes outlined in your living will. To ensure that your medical care preferences are carried out, you need a durable medical power of attorney or a do not resuscitate order.

Do Not Resuscitate Orders (DNRs)

A do not resuscitate order (DNR) is a request not to have cardiopulmonary resuscitation (CPR) or any other heart-starting actions performed on you should your heart stop or you stop breathing. All states and medical personnel are required to honor these orders, though some refuse to on occasion, as DNRs inevitably result in death.

Letters of Instruction

A letter of instruction is a document that specifies to whom you would like to give personal property that’s either not assigned to a beneficiary or not covered by your will. Letters of instruction typically do not cover every individual item you own. Instead, they apply to valuable objects not covered by wills, such as jewelry, coin collections, and so on.

Acknowledgments & Disclaimer