Incapacity Planning protects you in a situation where you become unable to control your finances or health decisions. If you don't plan for your incapacity, you run the risk of the courts interfering and acting inconsistently with your intentions. Incapacity planning involves designation control over finances and health decisions.
Power of attorney and healthcare designation can give control to the person you feel would make the best decisions on your behalf. Without these documents the courts can appoint a guardian for you. Or people you never intended can be put in the difficult position of having to make decisions on your behalf.
Durable Power of Attorney
The Durable Power of Attorney is a legal document which authorizes another person to act on your behalf. This power should be limited only to instances in which you are incapacitated or unable to act on your own. The Power of Attorney can be customized to a person's specific circumstance, specific or limited, and can be modified as long as the principal retains capacity. It is advisable to have one for healthcare and another to manage finances.
Health Care Surrogate Designation
The Health Care Surrogate Designation authorizes a someone to make medical decisions on behalf of an incapacitated person. The Health Care Surrogate Designation comes into effect when the person is incapacitated and unable to express their desires regarding medical treatment. It will be important to add a HIPPA release in conjunction with a HCSD naming all health care surrogates and entitling them access to the information necessary to make medical decisions
Creation of Joint Tenancies
A joint tenancy, with rights of survivorship, is a property ownership designation. Joint tenants to property have the same title, rights to possess and interest in that property. The right of survivorship allows a deceased tenant's (owner's) property interest to automatically pass to the other tenant (owner). As a survivor, the living joint tenant would then own the property in whole. This is often used in incapacity planning as a strategy to allow a joint tenant to assist in making decisions relevant to that property. However, this does little to provide asset protection. In the event that the incapacitated person passes, the property automatically goes to the surviving joint tenant without involving probate.
The Living Will expresses your desires regarding life-prolonging measures in the event of a terminal illness or vegetative state. A living will should be consistent with other incapacity planning objectives. The more consistent your planning is, the less you are at risk of unintended results or diminished control in the event of incapacity.
Nomination of Guardian
The Declaration of Guardian is a document that dictates your preference for a guardian for both you and your property if you become unable to conduct your own affairs. This document allows a person to become your legal guardian if you become incapacitated. Power of attorney is simpler and does not involve court oversight. A person who is appointed guardian will have to regularly check in with the courts regarding how funds are being spent. Pre-Need Guardian for a Minor is a designation for someone to become your child's guardian in the event of your incapacity.