While most people think about wills or trusts when planning their estates, it is important for them to also plan for the possibility that they may suffer an illness or injury that will leave them unable to make decisions while they are still living. There are several different ways people can plan for incapacity so that someone else can take care of certain matters on their behalf.
People may want to draft a durable power of attorney which can stay in effect if the person becomes incompetent. With a durable power of attorney, people designate an agent who is able to do such things as pay bills, conduct business and make financial decisions for them. They can also elect to prepare a springing power of attorney, which is one that will only become effective if one or two doctors state that the person has become incapacitated.
Another option is to put certain assets into a revocable trust. The grantor may control the operations of the trust while they are able to do so, naming a co-trustee who can step in in the event they become incapacitated. The co-trustee named should be someone whose judgment is sound and reliable. Normally, the person’s child who lives closest is a good option.
People who want to use a power of attorney for this type of a purpose may want to discuss the matter with their estate planning attorney. Legal counsel can prepare the needed document and helping clients determine who to designate as the agent who can act on their behalf if they undergo an incapacitating event. This can help the client’s family members by providing a means by which the client’s ongoing financial needs can be taken care of.