Incapacity Planning
When planning for your later years, you need to consider who will manage your personal finances and healthcare if you become too ill to do so yourself as well as what type of end-of-life care you want to receive. Generally, these issues are covered in the following documents:
Financial power of attorney: This document specifies who should take over financial decision making on your behalf if you become incapacitated and gives this individual power to pay bills, make investments, manage assets, file taxes, etc., on your behalf.
Revocable living trust: When establishing a trust to protect your assets, you can name a successor trustee to administer the trust if you become incapacitated. (Learn more about revocable living trusts.)
Living will: A living will enables you to detail exactly what type of care you wish to receive if you are no longer well enough to speak on your own behalf, including what life-saving interventions you deem acceptable.
Medical power of attorney: With this legal document, you determine who can make medical decisions on your behalf if you are unable to do so.
HIPAA authorization: State and federal laws prohibit the release of individuals’ medical information without their written consent. This document gives medical professionals the permission they need to share information regarding your health status and care to the individuals you have specified.
Discussions about your potential incapacity and end-of-life wishes are not easy; however, planning for these situations in advance can protect your financial wealth, ensure your healthcare wishes are honored, and save your family additional stress during a particularly difficult time.
