People who are planning their estates often fail to plan for the possibility that they may become incapacitated due to an accident or illness. If a person does not include incapacity planning as a part of the overall estate plan, other family members may have difficulty with being able to take care of the person’s financial needs.
There are several available options people may want to consider. A durable power of attorney will allow a designated agent to make financial decisions while the person is incapacitated. This can include the ability to make financial transactions, pay bills and conduct business on the incapacitated person’s behalf. People may choose to establish a springing power of attorney, which only takes effect if two doctors agree that the person is incapacitated.
Another option people may choose is to establish a revocable living trust over which they serve as the trustee. They may designate a co-trustee who can continue managing the assets owned by the trust in the event the grantor becomes incapacitated. It is important that people are careful in who they choose as their designated agent or co-trustee. Often, people determine that a good person to select is an adult child who lives nearby.
Preparing a comprehensive estate plan involves a careful consideration of all contingencies, including the possibility of suffering an incapacitating event. With the appropriate documents in place, a person’s needs may continue being met and their family may be in a better financial position than without them. People may want to look at the various options they have available to them with their estate planning attorney. An attorney might help clients with completing all needed documents in order to ensure their needs will be met in the event they subsequently are incapable of making important decisions on their own.