You may be surprised to find out just how likely it is that you will go through a period of incapacity at some point in your life. Largely due to the ubiquity of Alzheimer’s disease, nearly half of all individuals who are 85 years of age and older suffer from dementia.
Dementia can make it impossible for its victims to make sound financial and medical decisions, in fact, make sound decisions of any kind. If you were to be deemed incapable of decision making by the court, it could appoint a guardian to act on your behalf and you could become a ward of the state.
This is why incapacity planning is highly recommended. Some people think that estate planning is only about arranging for the transfer of assets at death. That may be the least important part of estate planning. It is best to develop a comprehensive life plan that addresses all of the eventualities and complications of aging.
Incapacity planning involves the execution of documents called durable powers of attorney. The word “durable” is operative here because, unlike standard powers of attorney, these vehicles remain in effect after the grantor becomes incapacitated.
With these documents you select attorneys-in-fact. We’re not talking about lawyers in this instance. Attorney-in-fact is a legal term for anyone who would be empowered to make decisions on your behalf should you become unable to make them for yourself. You could create a durable power of attorney for financial matters and one for making health care decisions.
Something to consider as well is that one could also include incapacity provisions when drawing up a revocable living trust.
To learn more about how to avoid a guardianship late in your life, take a moment to arrange for a consultation with a good Kansas City estate planning lawyer.
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Parman & Easterday