We’re all uneasy as we face the biggest health challenge of our lifetimes. Despite stringent safety precautions, this remains a highly contagious disease, and we’re all feeling vulnerable. Many people are feeling the urgency to create estate planning documents.
But estate planning isn’t only about what happens after a loved one’s death
Estate planning includes making plans for incapacity—when loved ones are no longer able to care for themselves.
For my own folks, incapacity necessitated an intervention after my stepfather suffered a minor stroke while driving. He veered off the road and plowed into a police car. The good news is that we finally were able to take his keys away and get him off the road.
My brother stepped in as his Power of Attorney
As the Financial Power of Attorney for my folks, my brother was able to manage their finances. I think my stepfather was happy to be relieved of this burden, and my mother was no longer able to deal with anything substantive. Fortunately, they both still had testamentary capacity and were able to sign the necessary legal documents. My brother also became the Agent for their Advance Healthcare Directives. He now had authority to carry out their final healthcare decisions.
Mental Incapacity can be caused by an accident, injury or illness
Mental incapacity results in someone’s being incapable of making informed decisions about their finances and wellbeing.
Without a comprehensive incapacity plan in place, a judge can appoint someone to take control of an incapacitated person’s assets and make all personal and medical decisions on that person’s behalf under a court-supervised guardianship or conservatorship.
The incapacitated person and his or her loved ones can lose valuable time, money, and control until the incapacitated person either regains capacity or dies.
Holding assets in joint accounts with another family member is a poor solution
Many believe they’re protected if they hold their assets in joint names with another family member. While a joint account holder may be able to pay bills, for instance, a joint owner of real estate will not be able to sell property without the consent of the other owner.
If that owner is legally incapacitated, the owner will not have clear title to the property and will not be able to sell it. Only a comprehensive incapacity plan will protect you and your assets from a court-supervised guardianship or conservatorship.
During this health crisis, many are feeling an urgency to create a Living Trust
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