Estate planning can mean considering some unpleasant topics. One of these is the possibility of incapacity. In other words, this means coming up with a plan for what should happen if one day you are unable to make important decisions on your own. While this may be an unpleasant thing to think about now, a little work in advance can save your loved one a lot of difficulty later on, should you one day become incapacitated due to injury or illness.
Estate planners should be familiar with the different types of estate planning documents used to prepare for incapacity.
Documents to include in an estate plan for incapacity
- Durable power of attorney: A durable power of attorney can be used to help protect the estate planner financially and medically if they become incapacitated. A power of attorney for financial affairs can help estate planners manage their financial affairs. The agent designated in the power of attorney should be a trusted individual and will have the authority manage the estate planner’s financial affairs of they are incapacitated. A power of attorney for medical affairs allows the designated agent to manage the estate planner’s medical affairs.
- Advance healthcare directive: An advance healthcare directive, also known as a living will, helps to name the types of medical care and treatment the estate planner wants to receive in advance. It can also name the types of medical care and treatment the estate planner wishes to refuse. A HIPAA form can also be useful to include because it will allow medical care providers to make medical disclosures to caregivers.
- A trust: A trust can also be used to effectively manage the estate planner’s finances during their lifetime, if they are incapacitated or following their.
Documents that help plan for incapacity can help put people and their families at ease during one of life’s most difficult times.