Incapacity planning is an important aspect of estate planning that addresses the possibility of an individual becoming unable to make decisions for themselves due to illness, injury or other reasons. Incapacity planning is essential to ensure that your financial and healthcare needs will be taken care of, even if you are unable to make decisions for yourself.
One of the most important tools for incapacity planning is a Durable Power of Attorney (DPOA). A DPOA is a legal document that allows you to appoint someone to make financial and legal decisions on your behalf in the event that you become incapacitated. The “durable” aspect of the power of attorney means that the authority granted in the document remains in effect even if you become incapacitated. This can include the ability to access bank accounts, pay bills, invest assets, and make decisions about real estate or other property.
In addition to a Durable Power of Attorney, a Revocable Living Trust (RLT) is a powerful tool for authorizing a trusted individual to make financial decisions for you should you become incapacitated. A RLT has the added benefit of providing for the administration of your estate without court involvement if you pass away, typically resulting in significant cost savings.
Another important tool for incapacity planning is an Advance Health Care Directive (AHCD). An AHCD allows you to express your wishes for medical treatment in the event that you become unable to make decisions for yourself. It also allows you to appoint someone, known as an agent, to make medical decisions on your behalf.
Long-term care planning is also an important aspect of incapacity planning. Long-term care planning includes planning for the possibility of needing care in the future, whether it be in a nursing home, assisted living facility, or at home. It’s important to consider what type of care you would prefer and to make sure that you have the financial resources to pay for it.
Additionally, it’s important to review and update your beneficiary designations, such as life insurance, bank accounts and other assets that have a designated beneficiary. This will ensure that your assets will be distributed according to your wishes even if you become incapacitated.
In conclusion, incapacity planning is an important aspect of estate planning. Consult with an experienced estate planning attorney to ensure that your plan is tailored to meet your specific needs.
Contact the Law Office of Carol A. Fauerbach at (916) 597-1305 to discuss options for developing a customized estate plan that meets the unique needs of you and your family.
The information you obtain at this site is not, nor is it intended to be, legal advice and does not establish an attorney-client relationship. You should consult an attorney for advice regarding your individual situation. We invite you to contact the Law Office of Carol A. Fauerbach at (916) 597-1305, and welcome your calls, letters, and electronic mail. Please do not send any confidential information to us until such time as an attorney-client relationship has been established.