Incapacity Planning is Party of a Comprehensive Estate Plan

Comprehensive estate planning is more than planning for gifts after death and avoiding probate. Estate planning must also create a means for managing your affairs if you become ill and mentally incapacitated. As a result, an essential part of any comprehensive estate plan are the documents that provide your trusted individuals with the authority to manage your health decisions and finances if you become ill. Two essential estate planning documents are an Advanced Health Care Directive and a Durable Power of Attorney.
Advanced Health Care Directive
An Advanced Health Care Directive allows you to select the individuals that will make health care decisions for you in the event you cannot make them for yourself. The Directive also allows you to make decisions regarding end of life, pain management, quality of life, donation of organs at death, and the disposition of your remains.
Without a Directive, your family may not be able to make health care decisions for you and may be denied access to medical information during a crisis situation. They may even end up in court fighting over what medical treatment you should, or should not, receive.
Durable Power of Attorney
A Durable Power of Attorney allows you to select the individuals that will manage your finances during a period of incapacity. Even if you have a Revocable Trust, you still need a Durable Power of Attorney because some assets cannot be held in a trust, and your agent may need additional financial authority.
Without a Durable Power of Attorney your family may not be able to pay bills, make financial decisions, manage investments, file tax returns, mortgage and sell real estate, and address other financial matters that are described in the document.
What Happens Without Incapacity Planning?
Without a comprehensive estate plan in place, a judge may need to appoint a conservator to take control of your finances and health care decisions. The conservator will make all personal and medical decisions on your behalf as part of a court-supervised conservatorship proceeding. Until you regain capacity or die, you and your loved ones will be faced with an expensive and time-consuming conservatorship.
At the very least, everyone should have a Durable Power of Attorney and an Advanced Health Care Directive. They are statutory forms in California, and they are fairly easy for an attorney to draft. In addition, I have reviewed many “estate plans” that do not have these two core documents. A Revocable Trust and a Will are not enough to take care of you during an illness and help prevent the need for a conservatorship. For your sake, and your loved ones, make sure that you are protected today.