People often put off creating an incapacity plan for many of the same reasons they put off creating an estate plan, including the belief that one is not necessary. The reality is that incapacity can strike anyone at any time. If it strikes you and you do not have a plan in place, a number of important questions will be left unanswered, including things such as who will control your assets and who will make decision for you. The good news is that a comprehensive estate plan should have an incapacity planning component built into it.
Why Do You Need Incapacity Planning?
Like many people, you likely think of “incapacity” in terms of an elderly individual suffering from Alzheimer’s disease or other old age related conditions. While Alzheimer’s certainly does lead to incapacity, and your odds of becoming incapacitated increase with age. The truth is that during your working years you stand a one in four chance of suffering a period of incapacity sufficient to require at least a brief stay in a long-term care facility. If that does happen, who will control your assets while you are unable to do so? Who will have the legal authority to pay your bills, maintain your property, or act on your behalf if a legal issue comes up? Who will have the right to make treatment decisions for you or decide which facility you should reside at and which doctor should treat you? Without an incapacity plan the answer to all these questions remain unknown.
What Is Incapacity Planning?
Incapacity planning is essentially what the name implies – a legal plan to deal with your incapacity should it occur at some point in the future. Though every plan is unique, some common incapacity planning tools and strategies include:
• Power of attorney – although a traditional power of attorney, or POA, does not survive the incapacity of the Principal, a “durable” power of attorney does, making it a useful incapacity planning tool. A POA, however, can be of limited value because even with general POA over someone there are certain things you cannot do. In addition, using a POA can be problematic as third parties often make it that way.
• Revocable living trust – a revocable living trust works like this: you create the trust and name yourself as the Trustee of the trust while naming a spouse (or whoever you wish to take over control of your assets in the event of your incapacity) as the successor Trustee. You then transfer important assets into the trust and continue to control and manage then as usual unless you become incapacitated. If that occurs, control will automatically shift to the successor Trustee.
• Advanced directives – an Advanced Directive allows you to make health care related decisions ahead of time. In Illinois, a Power of Attorney for Health Care allows you to appoint an Agent who will make decisions for you if you are unable to make them at some point in the future. The State of Illinois also allows you to execute a Living Will that essentially dictates that if you are suffering from a terminal condition, death delaying procedures will not be utilized to prolong your life.
How Can an Estate Planning Lawyer Help?
Ideally, your incapacity plan should be part of your overall estate plan. Your experienced Illinois estate planning lawyer can help you incorporate incapacity planning tools and strategies into your comprehensive estate plan, making sure all the components of your plan work well with each other.
For more information, please join us for one of our upcoming seminars or contact the experienced Illinois estate planning attorneys at Nash, Nash, Bean & Ford, LLP by calling 309-944-2188 to schedule your appointment today.