A will is an important part of an overall effective estate plan. Wills, however, do not become operative until death. In the unfortunate scenario where the individual who signed the will becomes incapacitated, the document lacks provisions to address such situations. Therefore, the inclusion of incapacity planning becomes a vital aspect of a well-rounded estate plan.
Incapacity planning can encompass a few different legal tools and documents. Sometimes, this concept can refer to addressing incapacity issues through wills, trusts, living trusts, a health care proxy, and/or choosing a successor trustee.
Before anything else, let us first define what is meant by being “incapacitated” in this context. In the realm of estate planning, “incapacity” refers to the inability of an individual to make sound decisions due to physical or mental conditions. This state of incapacity could be temporary (e.g. injuries from a car accident) or long-term (e.g. Alzheimer’s and dementia), arising from various factors such as accidents, illnesses, cognitive decline, or other debilitating circumstances.
Incapacity doesn’t just affect the elderly; it can impact individuals of all ages. During such periods, individuals might struggle to manage their affairs, make medical choices, or handle financial matters effectively. The absence of a clear plan to address incapacity can lead to distressing situations where important decisions are left to legal authorities, potentially causing emotional strain and financial complications for loved ones.
Incapacity planning, therefore, plays a pivotal role in anticipating and mitigating these challenges. It’s a crucial part of having a comprehensive estate plan.
Incapacity planning includes any planning efforts made to ease the burden on family and loved ones in the event they are unable to manage their affairs. Planning allows you to take control of the situation now, while healthy, to make your wishes clear and to ensure wishes are honored.
By establishing a comprehensive strategy that assigns decision-makers and outlines preferences in advance, you can ensure that your wishes are honored and that your affairs are managed smoothly, even during times of incapacity. This proactive approach not only offers a sense of control and security but also alleviates the burden on family members and ensures that personal values and intentions guide critical decisions.
Without a plan, if you become incapacitated, the likely outcome is a guardianship proceeding whereby a judge will decide who may make medical and financial decisions on your behalf. Guardianships are expensive, time-consuming, and intrusive in nature, and they often require regular accountings to the court.
Alternatively, by putting an incapacity plan into place now, you will be able to proactively take control of the situation and decide who may make medical and financial decisions for you, with specific direction based upon your preferences, if you should become incapacitated. The following are some key benefits:
You can include an advanced healthcare directive in your incapacity planning so you can identify exactly what types of medical treatment you want in specific situations.
When you plan, you won’t be stuck with whomever the courts appoint as your guardian. You can identify different individuals to handle various health care decisions and financial decisions based on your specific wishes.
Another major benefit of this type of planning is that there is no need for an extensive legal battle to establish guardianship. Once you are declared incapacitated, those who you identified will generally have an immediate right to act on your behalf without court approval.
Incapacity planning can include guidelines for managing digital assets such as online accounts, social media profiles, and important digital records. Specifying how these assets should be handled ensures their security and prevents unauthorized access during your incapacity.
By clearly outlining your wishes and designating decision-makers in advance, you can reduce the likelihood of disagreements among family members regarding medical treatment, financial matters, and other critical decisions.
For business owners, incapacity planning can include provisions for how the business should be managed in case of your incapacity. This helps ensure the smooth continuation of operations without disruption.
Guardianship proceedings can be intrusive and expose personal and financial matters to the public eye. Incapacity planning allows you to keep sensitive information private and within the family.
In times of crisis, family members are already under emotional strain. Having a well-structured incapacity plan in place minimizes stress by providing clear guidance and reducing the need for ad-hoc decisions.
Incapacity planning allows you to ensure that decisions made on your behalf align with your values and beliefs, especially in medical treatment and end-of-life scenarios.
Guardianship proceedings can be costly due to legal fees and court expenses. By planning, you can potentially save your loved ones from incurring significant financial burdens.
Above all, the primary benefit of incapacity planning lies in the peace of mind it brings. Knowing that your chosen plan is securely in place provides a sense of reassurance. To explore the many advantages of incapacity planning further, we encourage you to reach out to to us. Our team is ready to discuss your options and guide you toward achieving the peace of mind you seek.
Do you question the need for attorney guidance with so many online resources? Because laws and regulations are complex, and because every person has a lot at risk, more people than ever are seeking professional guidance from an experienced, knowledgeable source. That helps explain the rapid growth of our firm. Whether you happened upon this website by accident or are one of the many referrals we receive from a nearly 15-year collection of satisfied clients, our staff can provide customized estate planning guidance for you. Call us. Our number: 1 (772) 218-0480
Written by: John Mangan, JD, MBA