Estate planning is often associated with death. However, it’s just as important to address incapacity associated with illness, injury, advanced age or other circumstances.
Unless you specify how financial and health care decisions will be made in the event you become incapacitated, there’s no guarantee that your wishes will be carried out. Furthermore, without the appropriate documentation in place, your loved ones may be burdened with the necessity of seeking a court-appointed guardian and/or guardian.
Fortunately, there are several ways in which to address issues of incapacity in your estate plan, including:
1. A Revocable Living Trust. In the simplest of terms, you create a trust and transfer your assets to the trust, retaining control over your financial affairs by serving as the initial trustee. In the event you become incapacitated, your chosen successor trustee(s) succeed in managing the assets of the trust for your benefit.
2. A Durable Power of Attorney. This document authorizes your appointee/agent to manage your financial affairs and control your assets during your lifetime, subject to limitations you may establish. A Durable Power of Attorney is no longer effective following your death.
3. A Designation of Patient Advocate (or Durable Power of Attorney for Health Care or Health Care Surrogate). This document enables you to appoint an advocate to make medical decisions for you in the event you are unable to participate in making decisions regarding your own medical, or as applicable, mental health treatment.
4. A Living Will. Permitted in most states (but not recognized by statute in Michigan), a Living Will communicates your preferences regarding whether life-sustaining medical intervention — such as artificial nutrition or hydration — should be utilized under specified, life-threatening circumstances.
If you are concerned that your estate plan doesn’t cover the situation in which you might become disabled or incapacitated, please contact us.