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How to prepare for incapacity

On Behalf of | Nov 16, 2021 | Estate Planning |

Incapacity planning is an important part of the estate planning process. Estate planners should know how to prepare a plan for incapacity to ease the potential burden on loved ones and put their own minds at ease.

How to prepare a plan for incapacity

An incapacity plan includes several important elements. Documents to consider including as part of an incapacity plan are durable powers of attorney and a living will or advance healthcare directive.

To manage the estate planner’s financial affairs if they become incapacitated, they should consider including a durable power of attorney for financial affairs. This document will allow the person designated in the document to direct the estate planner’s financial affairs for them if they are incapacitated and are not capable of doing it for themselves. It will allow the person designated to pay bills, make financial decisions, manage investments, file tax returns, mortgage and sell real estate and take other financial actions outlined in the document on the estate planner’s behalf. Other estate planning tools, such as a revocable trust, may also be something the estate planner wants to consider to help manage their financial affairs in the event of incapacity.

To manage the estate planner’s medical affairs if the become incapacitated, they should consider including a durable power of attorney for medical affairs. Like a durable power of attorney for financial affairs, a durable power of attorney for medical affairs will allow the person designated in the document to direct the estate planner’s medical care and treatment if they are not capable of doing it for themselves. A living will, or advance healthcare directive, is also good to consider including because it specifies the type of medical care and treatment the estate planner wishes to receive or do not want to receive. A HIPAA authorization is also a good idea.

Estate planning documents can help estate planners cover all their bases if they become incapacitated at some point. To put the estate planner’s concerns, and the concerns of loved ones, at ease, it is a good idea to plan for incapacity should it happen.