Your estate plan should be comprehensive in nature so that your plan can accomplish a wide range of goals and objectives. While planning for the eventuality of your own death will be one of those goals, planning for the possibility of your own incapacity should be another estate planning goal. With that in mind, the Grand Forks incapacity planning attorneys at German Law explain five ways to plan for your own incapacity.
Why Is Incapacity Planning Important?
When you contemplate the possibility of becoming incapacitated you likely envision physical and/or mental incapacity caused by old age. While your odds of becoming physically or mentally incapacitated do increase with age, incapacity is not limited to the elderly. On the contrary, incapacity caused by a serious illness or injury can happen to you at any age. If you were to be incapacitated tomorrow, have you considered who you would want to handle your assets and finances? Who would you want to make healthcare decisions for you? Do you have strong feelings about life-prolonging or life-sustaining medical treatment? To make sure that your wishes are honored regarding all these questions, you need to plan for the possibility of your own incapacity.
What Should Be in My Incapacity Plan?
Just like your overall estate plan was created specifically to address your needs and wishes, your incapacity plan will also reflect your unique circumstances. There are, however, several tools found in the average incapacity plan, including:
- Establish a revocable living trust. For many people, a revocable living trust serves as the cornerstone of their incapacity plan. When used as an incapacity planning tool, a revocable living trust allows you name yourself as the Trustee and name a spouse, adult child, or trusted friend/family member as the successor Trustee. Major assets can then be transferred into the trust and managed by you unless you become incapacitated. At that point, your chosen successor Trustee can take over control seamlessly, without the need for judicial approval and eliminating the likelihood of disputes.
- Execute a springing durable Power of Attorney (POA). Another legal tool that can give someone control over your assets and/or provide the legal authority to act on your behalf is a Power of Attorney. A springing POA only activates if certain conditions are met, such as your incapacity. Making the POA durable ensures that the authority granted to your Agent in the POA survives your incapacity.
- Create a living Will. A living Will is a type of advance directive that allows you to make your wishes clear regarding certain types of medical procedures and treatment. For example, if you do not wish to be kept alive using intravenous nutrition or by the use of life-sustaining machines, you can make those wishes clear and your treating physicians must abide by your wishes.
- Execute a healthcare Power of Attorney. Another important advance directive is a healthcare Power of Attorney that lets you appoint an Agent to make healthcare decisions for you if you cannot make them yourself because you are incapacitated. Not only does this ensure that someone of your choosing makes important medical decisions, but it also reduces the likelihood of family disputes if someone needs to make those decisions.
- Include business succession planning in your estate plan. If you own a business, including a business succession plan within your estate plan is crucial to plan for the possibility of your own incapacity. Someone needs to be designated to take over control of the business during your incapacity and needs the legal authority to do so.
Are You Ready to Plan for Your Incapacity?
Please join us for an upcoming FREE seminar. If you are ready to create a plan for your incapacity within your larger estate plan, contact the Grand Forks incapacity planning attorneys at German Law by calling 701-738-0060 to schedule an appointment.
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