Episode Transcript
[00:00:00] Speaker A: Foreign.
[00:00:20] Speaker B: Welcome to Ignite. I'm your host, Vicki Wright Hamilton. On this show, we bring the insights to spark new ways of thinking, leading, and living with purpose. Today we're focusing on something that touches every family but is often put off until it's too late. Estate planning. Our guest is attorney Dionne Duckett, who has dedicated her legal career to helping families with estate planning and elder law.
Inspired by her personal journey of caring for her father with Alzheimer's and her sister with dawn syndrome, Dion brings both professional expertise and lived compassion to the family she serves. Dion, welcome to the show.
[00:01:16] Speaker A: Thank you, Vicki. And thank you for inviting me to join you today. I think what you're doing is so good and so good for the community as far as educating them on these important issues. Thank you for having me.
[00:01:28] Speaker B: Well, it's a pleasure. Let's start here. Many of our audiences do not have a clear plan for what happens to their family if something unexpected occurs. It often feels real scary and overwhelming, and we know people avoid it until it's too late because it's not something we really want to talk about.
So, Dion, as so many people push off estate planning, why do you think families often wait until a crisis happens before putting a plan in place?
[00:02:02] Speaker A: Well, I'm not sure why people wait, but I think it's because we always think we have more time.
A lot of times people don't want to talk about things like death.
And when we're younger, a lot of times people don't think it's necessary. But, you know, accidents happen every day. So I think the main thing is procrastination. And then when something happens, it's urgent and it's a crisis, and then they try to get things in place right away, and sometimes that's too late.
[00:02:35] Speaker B: You know, you're absolutely right. And I think the other thing is that, you know, we always say your number being called has no age on it.
And because of that, it becomes really, really important that you plan for those things and talk about them in advance. But what happens when there's no will or trust? And what kind of legal challenges usually fall to the families that are left behind when they don't have one?
[00:03:03] Speaker A: Well, I'd like to start with one thing. People always think about estate planning and wills and trust as far as what happens to my stuff when I die. But they don't think about what happens, you know, if they live. What happens if you become incapacitated and you're not able to take care of yourself if you haven't put a plan in place and you become incapacitated and you're not able to manage your affairs or manage your finances or even manage the things that you manage for your family. If you have people who are dependent on you, then your family members end up having to go to court to get those things taken care of. If you haven't done planning to name who you would want to be in charge, who you would want to take care of you, to take care of the things that you take care of, like your finances, or even to take care of your family or minor children, then it's up to the courts to take care of it, because you have to have the capacity to put the planning in place. And so, and usually when people are going to the court system, it's a crisis. And that can be timely, it can be costly, and you may end up getting someone appointed who you didn't want in place or even a total stranger. If family members are fighting over who. Who should be put in place, then the court will put, you know, the government or county conservator or guardian in place.
[00:04:35] Speaker B: Really tell us a little bit more about that, because I think it's so important that when we understand those kinds of challenges, when family is left behind and they don't have a will or trust. What do you mean, a government they can appoint to somebody else. That's why, I mean, that's crazy.
[00:04:54] Speaker A: Okay, so if you're incapacitated, then, and you can't manage your affairs and manage your care, then there's guardianship and there's two types of guardians, and it depends on what state you're in. In Georgia, we call the guardian over taking care of your care guardian and the person who's appointed to take care of your finances and your property conservator. In other places like Maryland, the guardian over your care is called the guardian of the person, and the guardian over your finances is the guardian of the property. And so if the court determines that you are incapacitated and can't manage your affairs and can't make decisions about your care or about your finances, then somebody has to be put in place.
And the court likes the least restrictive means. So through your planning, you could do powers of attorney or advance directives for healthcare or, you know, or if you're talking about what happens when you die, a will or a trust that names what you want to happen, how you want it to happen, and who you want to be responsible for it. If you haven't done that, then it's the government's plan. So when we're talking about not having a will or a trust after you die, then every state has a statute that says it's called intestate succession when you die without a will. And so every state has a statute that says who will inherit it, names who your heirs are and who's entitled to receive and how much they're entitled to receive. When it comes to incapacity, they have a preference for who can be appointed. And in both circumstances, so conservatorship or guardianship of the property is considered a living probate. So it's who's going to manage your property while you're alive. And then probate is death probate when you're dealing with the will.
So a lot of times family members aren't in agreement. And if they're not in agreement and they're fighting in court, then if there can't, if family members can't come up with the appropriate person to do it, then the court will appoint, you know, the county conservator or the county guardian or someone to fill that position. And those people will be paid out of your property. They can be a total stranger.
Or also, when it comes down to family members fighting, you may have a family member who's great with finances but not good with care. And so you might want that person who's good with finances to be the person who's managing your property. If you're not able to, you might have somebody who's good with care but not great with finances. So you might want that person to manage your care but not your finances.
And you may have a family member who has more money, but you wouldn't want them to take care of you. But if they're in court fighting with a family member who doesn't have resources, then you may end up with the family member that you didn't want in place. So by planning, you are able to say exactly who you want in place and what your preferences are. And as long as they meet the court requirements, or if your planning is in place, you can usually avoid the court process altogether. But if there's a problem and you have to go through the court, then the court is going to give preference to whoever you designate and that that deals with while you're alive and incapacitated with the guardianship and the conservatorship.
And it's the same when you die. If you don't have a will and it's intestate succession, then you haven't designated who you want to be the executor.
To manage the distribution of your assets. And again, if people are fighting, the court will appoint someone.
[00:09:06] Speaker B: Wow.
Wow. I mean, that's a lot of great information.
So let me ask you this.
You know, when we talk about legal paperwork can be so scary. And people are unsure, they're not sure exactly what to do, how to protect themselves. Especially when you talk about, you know, those that have the medical rights over you, over what you're doing, versus your property rights, et cetera. So when it comes to this legal. Legal paperwork, where do they get started? What's the first legal step that's recommended to take as you want to move forward?
[00:09:43] Speaker A: So the first step, which isn't necessarily a legal step, I think, is to educate yourself and to find out. You know, a lot of attorneys and different public interest groups have informational and educational seminars that will tell you about these various concepts. A lot of. A lot of attorneys or other groups also have. Have information and educational videos online. But you also have to be careful with that. You know, you can't believe everything that you see online or hear online.
And so then you want to go to an attorney, of course you can do it yourself. But people often mess up because they don't understand legal terms. And, and in the law, there are so many words that we use in everyday English that have very specific meanings. I've seen wills where people have, you know, people gloss over what they don't understand, or they just. They mention a trust, and there's no trust in place. They mention a trustee, and there's no trust. There's no trust for there to be a trustee. And so they make a mistake because they don't understand and they didn't want to pay to have an attorney guide them in the process. So I think that that's the biggest thing, is to seek professional help. And then when you are dealing with a professional, there are attorneys who specialize, or we don't even use the term specialize, but focus or concentrate their practice in all different areas. And there are attorneys who are general practitioners, but in every field, the law evolves and develops in different ways. And so a general practitioner, depending on how studious they are, they may not be aware of all of the different intricacies, all of the different.
The different things that you need to look out for, because it's not just a lot of people think of estate planning in terms of filling out documents. The documents are just the tools for getting the job done. So you need to seek counseling. The right attorney is going to ask you the right questions to meet your goals.
[00:12:08] Speaker B: Well, thanks so much for that. Coming up next, we're going to talk about probate and what it really is and how you can save your loved ones from all that added stress during already difficult times. We'll be right back.
[00:12:32] Speaker A: Sam.
[00:13:01] Speaker B: Welcome back to Ignite. Want more of what you're watching? Stay connected to Ignite and every NOW Media TV favorite, live or on demand and anytime you like, download the free Now Media TV app on Roku or iOS and unlock non stop bilingual programming. Yep, that's in English and in Spanish.
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I'm here with attorney Dionne Duckett. And in this segment, we're breaking down probate. And we know that for many families it's an unfamiliar word until they begin to grieve.
And then it quickly becomes what? Overwhelming. And we know the problem facing many people in our audience is that when a loved one passes away, families get stuck in that long, stressful probate process and it often feels like one more heavy burden during a time of grief.
So Deanna would love to get your perspective. For people who aren't familiar, can you explain what probate really is and why it can become such a time consuming legal process for families?
[00:14:45] Speaker A: Well, that's a good question, Vicki. So probate, the word probate means to prove the will. And the probate process is is what you have to go through. It's a court process for transferring someone's property after they died.
And it's required. A lot of times people think that if you have a will, then the executor, who's the person named in the will to carry out your wishes, that the executor can just take the will and do what the will says do. But like I said, the word probate means to prove the will.
So in order for the executor to have the authority, the will is actually a nomination of the executor. And so if you die without a will or a trust or something in place, you're said to have died intestate, but you still still have to go through the probate process. When there's no will is called intestate succession.
When there is a will, it's called probate. And when there's a will, it's usually referred to as an executor the person who carries out the process.
And with intestate succession, the person who carries out the process is the administrator. And in Georgia and a lot of states, both of them are referred to as personal representatives of the estate.
And so with the probate process, if there's a will, then the will has to be proven as valid before the court will admit it and give the executor the authority to carry out the instructions in the will.
And so when there is no will, the then someone has to petition the court to be appointed to carry out the administration of the estate and the distribution of the assets. And the purpose of the probate process is to protect beneficiaries, protect heirs, and to protect creditors.
So the reason the process takes time is, is the will has to be proven as valid.
Notice has to be given to all the heirs and sometimes to all of the beneficiaries, and also to the creditors. And with the probate process or intestate administration, the creditors have to have opportunity to file claims against the estate, and they're given a certain amount of time to do that.
Notice is published in the newspaper in Georgia. It's published, published for four consecutive weeks. And then after that, the creditors are given a period of time to file claims in order to maintain their priority.
And then after that, then claims have to be paid before any property can be distributed to beneficiaries or heirs. And so the difference between beneficiaries and heirs is an heir is who would inherit based on the statute, if you died without a will, a beneficiary is somebody who's named under the will to benefit. So a beneficiary can be an heir, but they don't have to be an heir.
I think that probably, hopefully that answers your question.
[00:18:13] Speaker B: Absolutely, absolutely. Well, let me ask you this. Is it possible to legally avoid probate altogether? And, and if so, how do you do it?
[00:18:24] Speaker A: So, yes, it is possible to avoid probate altogether. And the bottom line is, how is your property titled? And so probate property is property that's titled in your name alone, no joint owners at the time of your death, and does not have beneficiary designations. So examples of property that doesn't have to go through probate or are property like life insurance or retirement accounts that have beneficiary designations.
Now, if the beneficiaries are deceased and there's no contingent person named, then it will end up going through probate. Another type of beneficiary designation is a transfer on death or payable on death designation. So that's a designation often use the payable on death is often used on bank accounts that says on the death of the owner of the bank account to pay it to whoever the named.
For lack of a better term, beneficiary is transfer on death. In some states there's transfer on death deeds and the deed will say on death, transfer this property to this named person. So we, when there's beneficiary designations, transfer on death designations payable on death designations, that property will avoid probate as long as the designations are valid. Also when there's joint owners. Now there's different ways to own property jointly, especially with real estate. So you have what's called in Georgia joint tenants with right to survivorship. And so if there's more than one owner and they own by joint tenants with righteous survivorship, then that means if there's three owners and one owner dies, then the surviving joint tenants automatically get it so that property doesn't have to go through probate and then there's two left. If one dies, the surviving joint tenant gets the property and they don't have to go through probate. But then when there's one person left, there's no joint tenants and so then it would have to go through probate. Another way to own property is as tenants in common and in tenants in common you can own equal shares or unequal shares. So one person can own 25%, another can own 75% and or it can be 50, 50, but then it automatic. Then each person can transfer their property however they want. It does not automatically go to the surviving person.
[00:21:09] Speaker B: Wow. I know this audience is getting a lot of good nuggets. I know I was the executor of my parents estate and going through that process. And I'm going to tell you the biggest thing that you know that I think saved all of us was that we had those conversations. Everything about what kind of funeral you want, what that looks like, how you want what you want done with your remains all the way to what does it really mean, you know, if anything happens, what do you want your legacy, where do you want your legacy to go and who does it go to? And it is true that, you know, as they divide up among kids and grandkids and all, everybody may not get the same thing, everybody may not be allocated the same thing. And going through that entire process, it is just. And it can be time consuming if you don't have things in place. So this is such great information, Dion. I appreciate you so much for sharing it. What's Some of the biggest legal mistakes you've seen families make by accident, and then it forces them to go to probate.
[00:22:17] Speaker A: Mistakes that people make by accident is one not seeking guidance from an attorney so they do something the wrong way.
Things that force probate is we talked about joint tenants with rights, survivorship or tenants in common.
A lot of times people think that if there's two names on the deed, then it automatically goes to the surviving person.
That's going to depend on law in Georgia, if the deed doesn't specifically say it's joint tenants with rights, survivorship.
And if it doesn't say either joint tenants or tenants in common, the presumption is tenants in common.
And so in that circumstance, if a husband and wife own the property as tenants in common, you know, one person could transfer their property to their girlfriend or boyfriend and then the husband dies and the wife owns the property with the girlfriend or with the husband's mother or something like that, because it wasn't joint tenants with rights of survivorship and there was no designation.
Another way they end up in probate? Well, if there's a will, a will has to go through probate. And that's the mistake a lot of people think is that the will doesn't have to go through probate, but the will has to go through probate.
And the biggest thing is just not knowing what you're doing and not titling the property in the right way. And that's how it ends up in the probate process, which isn't necessarily a bad thing. But probate can cause delays.
[00:24:09] Speaker B: Wow. Dion, I know you provide resources for families who are facing all of these kinds of challenges. Where can viewers go to learn more and reach out to you directly?
[00:24:20] Speaker A: Well, I have a website. My website is www.ducketlaw LLC.com. that's-U C K E T T Law LLC. People always forget the LLC.
I have a YouTube channel that has some basic information on it. And if you're in Georgia or I'm also licensed in D.C. and Maryland, if you're in any of those jurisdictions, you can also call our office at 404-349-2220.
[00:24:55] Speaker B: Fantastic. We'll be right back. And up next, we're going to take a closer look at wills versus trust and clear up the confusion so you can make the right choice for your family. We'll be right back.
[00:25:36] Speaker A: Foreign.
[00:25:50] Speaker B: Welcome back to ignite. We're here with attorney Dion Duckett. And in this segment, we're going to clear up one of the biggest sources of Confusion in estate planning. Do you need a will, a trust, or both?
The problem facing many of the audience today is that they're not sure exactly what to do. Which one is better, or do I have to have both? And it's so confusing, and people worry about making the wrong choice. Dion, can you explain in simple terms what the key legal differences are between a will and a trust?
[00:26:31] Speaker A: I'll try.
So the key legal differences between a will and a trust, there are few.
A will is. Is a document that is only active after you die.
So while you're alive, it does not matter what the will says. It does not control your property while you're alive.
A trust, on the other hand, and there are lots of different types of trust, but a trust, if it's created while you're alive, we often call that a living trust, and it's active while you're alive, then it can manage your property while you're alive. If you become incapacitated, a will has no control if you become incapacitated.
The probate process is a public process.
So once you die, and if you have a will, and it is, there's. It's submitted to the court to. For the probate process, then anyone can go to the probate court and pull the records and see what's in the will, know that your estate is up for probate. I don't know about other states, but in Georgia, you have lots of people who are calling to buy your property, and they watch the probate records to see if you know your house might be up for sale. And so they start calling as soon as the documents are filed. They pay people who watch the probate records. So that's another difference, is the probate process is public, whereas the trust. A trust does not have to go through probate. And so if your property is titled in the name of a trust, the trust is a separate entity.
So if your property owns. Is owned by the trust, then it doesn't have to go through the probate process.
So privacy is an issue.
Is a difference. Cost can be a difference. It usually costs more to set up a trust on the front end, but probate can cost you a lot more on the back end.
A trust, if it's properly drafted and properly funded, there's two parts. You create the trust, but you also have to fund it. If there's property, let's. Outside of the trust, like we said, probate property is property that's titled in your name. So if you didn't transfer something to your trust, then it's going to go through probate.
Probate.
So a trust can be active while you're alive and incapacitated. And then it has provisions just like a will for after you die. A will is only active after you die. A trust only deals with property. A will deals with property and people. So in a trust, you cannot designate who you want to take care of your minor children or your dependent adult disabled children.
You would do that in a, in a will. Typically, if you have a trust, you're also going to have a will.
The will is usually referred to as a pour over will. So that if you did make a mistake and leave something outside of the trust, then it will go through probate. And ideally it's just one thing or, you know, not the bulk of your estate and the trope. And the, the will will say, pour this property over into the trust and distribute it the way the trust says distributed.
And so those are the key things. Cost can be a difference.
Like I said, the trust costs more on the front end, the probate costs more on the back end. Privacy can be a difference. Trust will allow you to have privacy.
Will. The probate process is the public process and then time. You know, with a trust, as long as everything's in order, the trustee does not have to worry about the probate process and the court process as far as delaying the process and being able to do what needs to be done.
[00:30:42] Speaker B: So in your, in, in your eyes, based upon what you said about what a will can cover, meaning that a will can take care of certain things that a trust can't, because a trust is doing property. Should you really have both? Do you put in both? Do you recommend doing both?
[00:31:00] Speaker A: Well, that depends.
And a will and a trust, they're documents, but they're tools. Okay, So a lot of times people call my office and they say, I want an irrevocable trust. And so there's lots of different kinds of trust. There's revocable trust, irrevocable trust. But you shouldn't call an attorney and specify what you want.
You should call an attorney and get a consultation and then talk to them about what your goals and objectives are. It may be that the trust is the better way to do it. It may be that a trust is not necessary. And so it's going to depend on your individual estate.
It's also going to depend on what your goals and objectives are. And so if you just call, make the appointment, explain to the attorney what your goals and objectives are, then the attorney can make recommendations about what tools can be used to accomplish those goals and objectives. And it may be a will, it may be a trust, or a combination of the two.
I do find that that often a trust is used because people want to avoid probate.
You own property in various states. You know, if, if you live in Georgia and you own property in Georgia and in Texas and in Ohio, then when you die, if it's with a will, if the property's owned in your name, then you have to do probate in Georgia, and then you have to do ancillary probate in Texas and in Ohio. So if the trust owns all the property, then you can avoid three probate processes.
So it really depends on your circumstances and your needs. But also people think that you have to have a lot of money, that it's only for rich people to use the trust, and that's just not true.
The other thing that is important to understand is how you make gifts. You can make gifts outright in the beneficiary's name.
You can also make gifts to someone in trust if you make the gift outright to them in their name. If it's money, they get a check if you make it to them. If in trust, then you can put instructions.
Your trust provides your instructions. So you can say whatever property you're leaving is to be used in this way.
You can put instructions on when it's distributed.
You can, if you have somebody who has, has drug problems or substance abuse problems and you don't want to disinherit them, then you can. With a trust, you can put somebody else in charge to manage it. And so you're not providing funds that may feed their habit.
You can also provide, but in those circumstances, you're still providing for that person. You're just not giving it to them to waste or feed their habit.
You may have substantial funds and you may have a young or immature beneficiary. So if one of your grandchildren or you die young and your child is still a minor, if it's an outright gift, as soon as they turn 18 or whatever the age of majority is, they're entitled to receive those funds. Okay, so what is an 18 year old going to do with 10,000, 20,000, $100,000?
So if you put it in a trust, you can have someone else manage it. You can provide instructions for how it's to be used.
And another big thing you can do for your beneficiaries is if you use a trust is you can provide creditor protection.
So, and the way you end up doing that is that you put the property in the trust for someone else. So you can't really put it, put your own property in a trust to protect from your creditors. Everybody would do that. You know, they buy up stuff, get a loan, you know, buy a house, put it in a trust and say I'm not going to pay for it.
Now there are in some states and that's a more advanced technique where you can do things to protect your own assets. But if you are planning for beneficiaries after you die, if you put them in trust, you can provide credit or protections that say the property that I am leaving you in this trust cannot be used to pay creditors. And so a creditor can be a divorcing spouse who wants half.
A creditor can be, you know, maybe your beneficiary is on hard times and they're going through bankruptcy. So you got bankruptcy creditors. So you're able to provide with a trust management and creditor protection.
[00:36:17] Speaker B: Wow.
I never thought that you could use a trust for creditors. Never thought about that. But you know, it makes sense. But never think about how that as you're giving the instructions for property or anything you own to be able to say that, hey, wait a minute, you can't use this to come and get it where especially if you're protecting, you know, if you're giving it to a son and you're protecting from a potential daughter in law in a divorce or whatever the case may be. Never thought about those things. And those are, that's good insight to be able to help us as we're beginning to think about how we want to leave our legacy and what kind of protection we want to leave. This has been so, so impactful. We'll be right back. And in our final segment, we're going to talk about why we're never too young to plan. And you talked about this in the beginning a little bit. And why preparing now can protect your family no matter what happens down the road. We'll be right back.
[00:37:31] Speaker A: Sa.
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For our closing conversation with attorney Dionne Duckett. And we're going to dive into why estate planning is not just for older adults.
Is something every generation should consider.
Whether you're in your 30s, 40s, or beyond.
Preparation gives your family peace of mind.
And I know the problems that are facing many of our audience and others is believing they are too young or too healthy. How many times have we heard that to worry about estate planning? It often feels like something that we can wait on and we don't have to do it now.
Dionne, why is it legally important for young parents and professionals to start estate planning early?
[00:40:03] Speaker A: Well, it's important to start planning early because you never know when. When something could happen.
Accidents happen all the time. I know here in Atlanta, people, you know, when you're driving, people look at stoplights and stop signs as a caution or recommendation. They run through the lights every day here. And so you could be in an accident and something could happen to you. And so it's important to plan as soon as you become an adult so that there will be people in place to manage your care, manage your financial decisions, and you can designate people to manage to take care of your children. If you have young children, then you need for someone to take care of your children.
An example I like to give was a family member who was 27 years old, had just gotten a new job, new apartment, that means new cable bill, new electric bill, all that stuff. He was driving and he was in a car accident, head on collision on the highway with a drunk driver driving in the wrong lane. And he was in a coma. And so now he was going to. And fortunately he recovered, but now he was going to have to go home to his parents for rehab.
The accident was so bad that they wouldn't let his mother see what the vehicle looked like. And it was one of those big Escalade type vehicles and it was totally mangled and they wouldn't let her see it because that's how bad the accident was. But when the parents went to the apartment complex to try to cancel the lease the to the cable company to try to cancel the bill so that they weren't just racking up. They said, where's your power of attorney? Where's your authority? And so because this person was young, he was 27 years old. When you're 27, you're not necessarily thinking, hey, I need to have a power of attorney, okay? And so when your kids go to college at the age of 18. Once they turn 18, they are adults. And so the parents legally don't have the authority to call the doctor and find out what's going on or to make decisions about the kids money or care. And so, you know, most recently for a young lady who was going to college, I did a college student plan that had her power of attorney. So if something happened to her, her mother could manage her finances. If she was in an accident and had to go to the hospital, the mother could talk to the doctors, and the doctors didn't have to worry about disclosing information.
And so you may not need a full fledged will, you may not have property or anything like that, but you do need the health care documents in place. And then when we talk about young parents and young professionals, you know, who do you want to take care of your children if something happens to you? Is there somebody who. You don't want to take care of your children if something happens to you?
So accidents happen every day, and it's important that you have planned for that.
[00:43:31] Speaker B: You know, and it's, it's sad, but it's so true. I remember when my children were born, and at the very beginning, when they were first born, I got life insurance policy, right? Because you never know things gone. And it sounds morbid. It sounds like, oh, my God, you're praying you're. You're going to get something for their death. And they just got here. But you know, number one, it's cheaper at that point. But number two, to your point, you never know what happens. And it almost feels like, okay, you know, when they're, when they're growing up and they're under your care and they're minors, it's one thing, but it's like for Europe before your 18th birthday, is that we got to go get all these documents, we got to go make sure everything is right so that you're protected. Because normally, you know, it's like you said, you go to college, you think, I can call mom and say, mom, can you do so and so? But legally, mom may not be able to, you know, do it for you and help you. And it's just things that we never, ever consider in terms of the simple things in life that we do that are every day that we somewhat take for granted as those days progress and as we're getting older. But, you know, Dion, there's something that I hear all the time, and having been through this, I think it's important for our audience to understand what a power of attorney is.
And when can it be used? You know? And can a power of attorney. Does it exist after death? Is it only while they're alive? What does it really mean? Because I think that I hear people say, oh, I got a power of attorney. Well, when they're dead, guess what? Does it really matter? So I'd love for you to educate our audience on the importance and what it means to be a power of attorney.
[00:45:20] Speaker A: Okay, So a financial power of attorney. And there's different types and there's lots of terminology. So I'll try to break all of that down.
First, you have a principal. The principal is the person who, who is creating the power of attorney and designating the power.
Then you have the agent, sometimes called an attorney, in fact. So that's who the principal designates to be the agent to manage the finances if something happens. And so you've got the principal and the agent. The principal creates and grants the power. The agent is the person who is the fiduciary. Means they have a legal obligation to act in the best interest of the principal.
So the agent is the one who manages the property. So then there's two types.
A power of attorney can be limited or it can be general. A limited power of attorney is one that's limited in time or in transactions. So, so an example of time, maybe you're going out of the country and you want somebody to manage your property while you're gone. And you're going to be gone for 30 days. So you can grant a limited power of attorney for 30 Days for your agent to manage whatever the property is. It can be limited in whatever the property is as well.
A transactional power of attorney. An example I like to use is when my sister and her husband were much younger and they were buying their first house.
They were going to be out of town on the day of the closing. So they gave my mother power of attorney for that specific transaction. So my mother was appointed as the agent, and she had the power to. To sign on their behalf for the closing when they were purchasing the house. And after that, her power ended. Okay, and so then.
So a general power of attorney is one that basically covers everything.
And you talked about what happens when you die. When you die, a power of attorney dies with the maker. So it is illegal to. To use the power of attorney after the person who created the power of attorney has died.
Durable is another term. And so capacity is very important.
I have people, adult children often, who call and say, I want to do a power of attorney for my mother. Well, you can't do a power of attorney for someone else. Only the person whose property it is has the ability to create the. The power of attorney.
And that person has to have the mental capacity to understand what they're doing, basically understand the contract, know what they're doing with this power of attorney, because they're giving someone else the right to manage their property. So if they have lost the capacity, you know, develop dementia.
And that's a unique thing because with dementia, you can have periods of clarity and you can create your. Your estate planning then. And so, but you have to have capacity to create a power of attorney.
So durable means that you've created while. Created it while you had capacity, but then if you lose capacity, it's still in place.
Okay? And so, so that's what durable means. And then you asked about when it becomes effective. And so you can make a power of attorney effective immediately upon signing.
And then even if you are not incapacitated or whatever, you know, if your agent has that power of attorney and it gives them the ability to act in connection with your property, they can go straight to the bank and use it. So that's where it becomes very important on who you select as your agents. And I'll tell you a story about that in a minute. So we talked about effective immediately. But you can also say that a power of attorney is effective on an occurrence of a certain event. And so a lot of times people say disability.
So it's only effective if I'm disabled. And then you have to define what that matters, what that means, who gets to determine. Do you have a disability panel or is it two doctors or is it one doctor? You get to determine that. And then the story that I wanted to tell years ago, I had a client whose brother brought me to do her planning. And she said, make my brother my agent.
So we did. And so then her daughter saw the draft documents and her feelings were hurt that her mom designated the uncle instead of the daughter. So my client came back and said, make my daughter the power of the agent under my power of attorney. And it was effective immediately. Well, as soon as the ink was dry, daughter started spending mom's money daughter.
And she was. Even though she was fixing up mom's house, she wasn't fixing it up for mom. She was fixing it up for when mom died.
She.
[00:50:51] Speaker B: Yeah, those are valuable lessons, you know what I'm saying? And what you're saying is so real. It's just so real.
[00:51:00] Speaker A: And the other thing she did, signed the sign, she co signed mom's name on the grandchild student loan. So then mom came back. Change it.
[00:51:10] Speaker B: Wow. So wow. So you have to incredibly valuable and I know this information is people are things that people are going to use right away. Where can people follow your work and continue the conversation with you?
[00:51:24] Speaker A: Well, again, My website is www.ducket-u c K-E-T-T law llc.com www.ducketlaw llc.com and the telephone number for our office is 404-349-2220. I'm licensed in Georgia, Maryland and the District of Columbia.
[00:51:52] Speaker B: Fantastic. Dion, thank you for sharing your expertise at heart with us today. You've shown that estate planning isn't just about paperwork. It's about protecting our families, avoiding unnecessary stress and and making sure our legacy is one of care and the peace of mind to our viewers. Remember, it's never too early to prepare, but it can be too late if you wait. Take the time today to protect tomorrow. I'm Vicki Wright Hamilton and this has been Ignite on NOW Media tv. Until next time, stay empowered, stay intentional and and keep igniting your path forward.
