You should take a comprehensive approach when you are planning your estate. Yes, you have to address the way that your assets will be distributed after you are gone. At the same time, it is important to consider the eventualities that you will face when you reach an advanced age.
Cognitive Impairment
Alzheimer’s is not the only cause of cognitive impairment, but it is the most significant threat. It strikes about 32 percent of the oldest old according to the Alzheimer’s Association, so it is something to take very seriously.
Clearly, people with this disease are going to experience dementia, which will strip them of their ability to make sound decisions on their own. Hopefully, you will never have this experience, but you should take steps to prepare yourself because there are no guarantees.
Living Trust With a Disability Trustee
A living trust is the ideal estate planning centerpiece for a wide range of people, and probate avoidance is one of the main advantages. This is a legal process that is time consuming and expensive, and it would be necessary if you state your final wishes in a will.
If you utilize a living trust as your asset transfer vehicle, you will act as the trustee while you are alive, so you would still have control of the assets. After your death, a successor trustee that you name would administer the trust, and probate would not be a factor.
From an incapacity planning perspective, you can give the successor trustee the power to step into the role in the event of your incapacity. When you designate a disability trustee, you can go forward with the knowledge that you have a contingency plan in place.
Durable Power of Attorney for Property
You may not convey all of your property into the trust for some reason, and you may choose to use a will instead of a trust. To account for the management of property that is not held by a trust, you can execute a durable power of attorney for property.
The agent that you name would manage your financial affairs that are not connected to the administration of a trust. A durable power of attorney will remain in effect if you become incapacitated, so the “durable” designation is important.
There is also a spring durable power of attorney. This device will only go into effect if you become incapacitated, but the burden of proving incapacitation can complicate matters.
Advance Directives for Health Care
Medical scenarios can unfold when you are unable to communicate your own decisions, so your incapacity plan should include advance directives for health care. A living will is one of these directives, and you use this type of will to state your life support preferences.
It is possible to itemize each different life-support technique if you choose to be specific, and you can add your comfort care medication and organ and tissue donation choices.
Situations may arise that do not involve the use of life-support. You can designate a decision-maker to act on your behalf if it becomes necessary in a durable power of attorney for health care.
The Health Insurance Portability and Accountability Act (HIPAA) of 1996 was enacted to protect patient privacy. There is a provision in this measure that prevents doctors from sharing medical information with anyone other than the patient.
As a patient, you have the right to release the information to anyone that you choose. This is done through the utilization of a HIPAA release form, so you should include one of these documents when you are developing your incapacity plan.
Take Action Today!
Today is the day for action if you are going through life without an incapacity plan. If you are ready to get started, you can schedule a consultation at our Burbank, CA estate planning office if you call us at 818-937-2335.
There is also a contact form on this site you can use to send us a message, and if you reach out electronically, we will get back in touch with you promptly.
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