Many people associate estate planning with preparing for what happens following their deaths. However, an important component of estate planning often includes preparing for the future as well, including what your wishes are should you become incapacitated and unable to make important decisions for yourself.
What is incapacity planning?
A plan for incapacity often includes two documents or tools: a power of attorney and an advance health care directive. These can help you plan for future critical decisions regarding your finances and health care, respectively.
“Incapacity” means that you are unable to make decisions on your own behalf – and some of these decisions can be critical. Such conditions that could prevent you from acting on your own accord can include sudden physical conditions like a heart attack or stroke, as well as conditions that might deteriorate your mind more rapidly, such as dementia.
Read more below about what you should know about incapacity planning.
Power of attorney
This document allows you to plan for how to manage financial decisions on your behalf in the event of your incapacitation. With this document, you name someone to take care of your finances on your behalf. This can be in a limited or broad capacity, but can include giving authority to make deposits, write checks, buy and sell investments or property and more.
Advance health care directive
This is a written directive that allows you to plan for future health care needs and preferences, should you be unable to communicate your wishes at that time. This provides for the types of medical care and treatment you wish to receive, as well as the medical care and treatment you do not want to receive. It can also provide direction concerning end-of-life wishes and resuscitation and if that is what you want.
Estate planning provides resources and tools to plan for incapacity should the estate planner become incapacitated or disabled either temporarily or permanently. By planning ahead for the unknown, you can feel a sense of relief in knowing that your wishes are documented should something unpredictable happen.