One of The Greatest Gifts To Your Family Is The Plan For Incapacity
When most people think about Wills and Trusts planning, they instinctively associate it with taking legal steps to ensure that the right people inherit their stuff after they die. And this is true—Wills and Trusts planning does provide that. However, that definition leaves out a crucial aspect of planning for life that is encompassed by an Will and Trust.
Estate planning allows you to plan for more than just who inherits your belongings and legacy after you die, and ignoring the other things you can plan for could be a major oversight. For example, consider that at some point before your death, you could be incapacitated by accident or illness.
Death is the final outcome, but a devastating accident or disease can render us unable to care for ourselves or our loved ones. Accidents and illness are occurrences that do happen during our lives, but unlike death, incapacity doesn’t have a scheduled outcome and timeframe.
Incapacity is unpredictable – it can be temporary, recoverable from after a few days, months, or years, but it can also be a permanent and costly event that is never resolved until death. For you and your family, incapacity can be an uncertain and agonizing limbo, which is why planning for it can be an incredible relief in the time when your loved ones need relief the most.
Because of the nature of it, incapacity can be a far greater burden for you and your loved ones than even your death, both financially and emotionally. Between the ruinous financial costs, emotional trauma, contentious court battles, and internal conflict and stress your family may endure, including provisions for your incapacity in your Wills and Trusts planning becomes a core concern.
The purpose of an effective Will and Trust is to keep your family out of court and conflict – no matter what happens to you. That is why only planning for your death can leave your family vulnerable, with tragic consequences.
Where to Start
Planning for incapacity is fundamentally different than planning for death. Namely, you’ll still be alive when these planning strategies take effect. Furthermore, the legal authority you grant to others to manage your incapacity is only viable while you remain alive and unable to make decisions about your own welfare. Once you recover, all legal power granted to others is then revoked. Similarly, if you succumb to your condition, your death renders these granted powers null and void.
With this in mind, the first thing you should ask yourself is, “If I’m ever incapacitated and unable to care for myself, who would I want to make decisions on my behalf?” The person or persons that you select will be in charge of making your healthcare, financial, and legal decisions for you while you are incapacitated.
You must name someone
The most crucial aspect of this planning is that you must choose someone. Keep in mind that if you do not legally name someone to make these decisions for you, the court will choose someone for you. This could make things difficult for you and your loved ones.
Although laws differ state to state, in the absence of a proper Will and Trust, the court will typically appoint a guardian or conservator. This choice could be a family member you would never want to manage your affairs or a professional guardian who charges exorbitant fees that could potentially ruin your estate. And by then, the choice is out of your hands.
Additionally, like most court proceedings, the process of naming a guardian after you are incapacitated can be quite time-consuming, costly, and emotionally draining for your family members. Even after all that effort to appoint a guardian to look after your best interests, the appointed guardian may choose treatment options, such as invasive surgeries, that are the exact opposite of what you would want.
That is why having a proper Will and Trust is key to easily avoiding this potential turmoil and expense. An effective plan would immediately give the named individual authority to make your medical, financial, and legal decisions without the need for court intervention. Your plan even includes clear guidance and instructions about how you would want to handle your incapacity so that there are no mistakes or conflict about how you wish these vital decisions to be resolved.
What won’t work
Your personal circumstances will determine which planning tools you should use to grant and guide this decision-making authority. There are several options available to choose from, and knowing which choice is best for you is something you should ultimately decide on after consulting with an experienced lawyer like us.
With that being said, we can tell you one planning tool that is totally useless when it comes to your incapacity: a will. A will only goes into effect upon your death, and even then it only governs how your assets should be divided. It won’t keep you or your loved ones out of court and conflict while you are still alive.
The proper tools for the job
An incapacity plan is more than a single document; it should include a comprehensive variety of multiple planning tools, each serving a different purpose. Though the strategies you put into place will be based on your particular circumstances, it’s likely that your plan will include some or all of the following:
- Healthcare power of attorney: An advanced directive that grants an individual of your choice the immediate legal authority to make decisions about your medical treatment in the event of your incapacity.
- Living Will: An advanced directive that provides specific guidance about how your medical decisions should be made during your incapacity.
- Durable financial power of attorney: A planning document that grants an individual of your choice the immediate legal authority to make decisions related to the management of your finances, real estate, and business interests.
- Revocable living trust: A planning document that immediately transfers control of all assets held by the trust to a person of your choosing to be used for your benefit in the event of your incapacity. The trust can include legally binding instructions for how your care should be managed and even spell out specific conditions that must be met for you to be deemed incapacitated.
Keep in mind that while each of these documents is important, they are often of limited usefulness without the counsel and guidance of a personal lawyer who knows you, knows what is important to you, knows how to locate your assets, and knows who can guide your family when they do not know where to turn.
Don’t let a bad situation become much worse
You may be powerless to prevent your potential incapacity, but you can control over how your life and assets will be managed if it does occur– through proper Wills and Trusts planning. Moreover, such planning can prevent your family from enduring needless trauma, conflict, court intervention, and expense during an already trying time.
If you’ve yet to plan for incapacity, meet with us as your Personal Family Lawyer® right away. We can counsel you on the proper planning vehicles to put in place, and help you select the individuals best suited to make such critical decisions on your behalf. If you already have planning strategies in place, we can review your plan to make sure it’s been properly set up, maintained, and updated. Contact us today to get started.
This article is a service of Levi Alexander, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session™, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.