In an Emergency, Do You Have an Incapacity Plan? - Morris Law Center

In an Emergency, Do You Have an Incapacity Plan?

Incapacity planning is part of an estate plan, even if it’s not highlighted, there are plans that are literally just for incapacity. These things have come up more recently because there are more people that are at risk for early onset dementia and Alzheimer’s disease. If you have parents that have shown signs of dementia, then you may want to think about this kind of thing for them while they can still make their own decisions.

So, what are we talking about when we say incapacity planning? Well, it’s like I said, it’s part of an estate plan, but unlike estate planning as a whole, you’re planning for a possibility, not an eventuality. With an estate plan, you’re eventually going to pass away, so the plan will eventually kick into action. With incapacity planning, hopefully it never does kick into action, but in case it does, you have a plan. Most of the time when we’re talking about incapacity planning, we’re talking about planning for finances and health care.

I know I’ve spoken to you before about powers of attorney and specifically powers of attorney over healthcare and finances. There’s two. Those are two separate powers of attorney. These are part of an incapacity plan. When you are incapacitated, you want to make sure that you nominate somebody that will take care of your financial decisions and be involved in your health care decisions, if you can’t make those decisions.

So that’s where the powers of attorney come into play. First, you nominate an agent to be your healthcare power of attorney and this agent you can. You can also give them some guidance about what you want to happen. If you don’t have a power of attorney over healthcare and you are incapacitated, it can be a challenging time for your loved ones and family because if you’ve got more than one loved or family member, then maybe they don’t agree on the decisions being made.

Second, the court may need to get involved to decide who actually will be the person that makes those decisions, so it can cost money. You may have to go through a legal process. That’s why incapacity planning is actually a very helpful and critical thing that you should think about doing.

This segues into the power of attorney over financial. So if you are incapacitated, you probably still have bills that you need to pay and somebody is going to have to be able to do that. Somebody is going to have to be able to access your bank account to pay the bills as well as accessing those accounts that you need to pay. So the actual billing accounts as well. And again, if you do not have a power of attorney over financial decisions that you can present to your bank and to the billers, then you may have to go to court so that the court can order somebody to deal with your finances while you’re incapacitated.

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