Estate planning is not simply for those individuals who wish to plan for their death. A great estate plan will also contain provisions and documents that help in times of incapacity as well. Estate planning will also take care of disability planning.
If you are mentally or physically unable to control your assets or medical decisions, who will actually step in and do it for you?
Here are some essential steps that every individual must take, regardless of the size of their estate, to ensure that your loved ones will know what to do and how to do it.
Taking Care of Your Finances
To handle your finances properly and by the person you wish, you must have a power of attorney for finances, also sometimes called a “Durable Power of Attorney for Asset Management” or “Durable Power of Attorney for Finances.” It is a legal document that allows you to give someone the power to act on your behalf after you have become incapacitated. The person you designate will be able to pay your bills, make deposits, withdraw money, and handle all of your money matters on your behalf.
Whether you have a bank account with $400.00 or an estate worth $2,000,000.00, it is a good idea for almost everyone with property or any income to have a durable power of attorney for finances. Without this important document, your loved ones will have to go to court and ask a judge to give them authority over your financial affairs.
Taking Care of Your Health
By creating a health care power of attorney, you name a trusted friend or family member to take care of your medical decisions when you are mentally or physically unable to. This person will be in charge of speaking with your doctors, gathering medical information about your condition and making all health decisions on your behalf. Without this important document, your loved ones have to go to court and ask a judge for a “conservatorship” which can be expensive and embarrassing, not to mention your loved ones must ask the court to rule that you cannot take care of yourself— a public airing of a very private matter. What is worse is that you may be in a physical state that requires decisions to be made fast, so there may be no time to waste going to court.
In addition to these documents, you should also ensure that you have designated the right person to take care of your digital assets or digital accounts through a Digital Power of Attorney document. These are just the essential steps that every person should take to ensure all their ducks are in order in case the expected or unexpected happens.