One of the more common issues that elder law attorneys have to deal with is incapacity planning. Everyone knows that as we get older we lose our ability to do the things we were once able to do. Whether these declines result from specific medical conditions or from the aging process itself, incapacity planning deals with the possibility that you might one day experience a decline so significant that you can no longer make your own decisions. When developing an incapacity plan, there are several tools you will need to consider. Here is a quick review.
Financial Power of Attorney
Incapacity planning allows someone else to step in to make decisions for you when you no longer can. Some the most important decisions you have to make in your day-to-day life concerns your finances. Through a financial power of attorney you give a person, called an agent or an attorney-in-fact, the ability to act for you when making these financial decisions. You can allow your agent the ability to make almost any financial decision that you can make. Your agent can do everything from paying your bills to managing your investments and taking care of your home.
Health Care Power of Attorney
Like your financial power of attorney, your health care power of attorney gives you the ability to name someone who will make decisions for you. However, the decisions your health care agent makes have to do with your medical decisions. A health care power of attorney, sometimes called a health care proxy, allows you to select an agent who can speak with your doctors and tell them what kinds of treatments or procedures you do or do not wish to receive.
Revocable Living Trust
When people create a revocable living trust they transfer their property into the trust’s name so they can more easily pass inheritances on after they die. However, people with a living trust can also use these devices in incapacity planning.
When you create a living trust you usually name yourself as the trustee. As trustee you have a responsibility to manage the trust property so that the beneficiary can use it. If you become incapacitated as a trustee, someone will have to take over managing the trust property for you. This person, known as the replacement trustee, will have the responsibility of managing the trust property. Because of this, you can use your living trust as a way to ensure that your property is cared for.
Incapacity Planning Choices
Taking the time to consider your options in incapacity planning is something you should do only after speaking to your estate planning lawyer. There are many ways to protect against incapacity, but a good plan is one that fits your individual circumstances.