When you contemplate the need for estate planning, you probably focus on the need to plan for the distribution of your assets after your death. While making sure your estate is handled according to your wishes is certainly an important estate planning function, planning for the possibility of your own incapacity should be given equal consideration within your estate plan. To make sure you are protected, a Murfreesboro incapacity planning attorney at Bennett, Michael & Hornsby explains the importance of incapacity planning.
What You Probably Do Not Realize about Incapacity
The word “incapacity” typically brings to mind someone nearing the end of their life suffering from Alzheimer’s or another age-related condition. There is no doubt that the likelihood of becoming incapacitated increases dramatically during your later years; however, you might be surprised to learn how likely it is before you reach retirement age. For example, prior to age 40 you are three times more likely to become incapacitated than you are to die. Moreover, one in four of today’s 20-year-olds can expect to be out of work for at least a year because of a disabling condition before they reach retirement age.
Why Do I Need to Plan for Incapacity?
The best way to help you understand the need to plan for the possibility of your own incapacity is to explain what might happen in the absence of a plan. Imagine, for a moment, that a catastrophic car accident left you incapacitated for several months. During that period of incapacity, someone would need to make health care decisions for you if you were unable to make them yourself. Someone might also need to make personal decisions, such as where you will live, as well as take over control of your assets and finances. If you failed to make your wishes clear ahead of time, a judge may be forced to decide who will make medical and personal decisions for you and who will take over your assets and finances. Not only did you give up the opportunity to decide for yourself who steps in and takes over, but your loved ones may end up in a battle over the right to be the one appointed by the court.
What Is Included in an Incapacity Plan?
An incapacity plan should be tailored to your unique needs and expectations; however, two common incapacity planning tools are a revocable living trust and an advance directive.
A revocable living trust works as an incapacity planning tool by allowing you, as the Settlor (creator) of the trust, to appoint yourself as the Trustee and appoint someone you wish to take over control of your assets during your incapacity as the successor Trustee. Once the trust has been established you transfer all major assets into the trust. While you are capable, you control and manage the trust assets as the Trustee. If you become incapacitated, however, your designated successor Trustee takes over management of the trust assets during your period of incapacity.
Tennessee has combined a Living Will with a Medical Power of Attorney into one advance directive known as an “Advance Directive for Health Care.” This is a legal document that allows you to make important health care decisions now, such as which type of procedures and/or treatment you wish to authorize or reject as well as appoint an Agent who will have the legal authority to make healthcare decisions for you if you cannot make them. Executing an advance directive ensures that your wishes will be honored with regard to medical treatment and that someone you trust will make decisions for you if the need arises.
Contact a Murfreesboro Incapacity Planning Attorney
If you have additional questions or concerns regarding the importance of including an incapacity planning component in your estate plan, consult with an experienced Murfreesboro incapacity planning attorney at Bennett, Michael & Hornsby as soon as possible. Contact the team today by calling 615-898-1560 to schedule your appointment.