When you decide that you would like to go on a trip you are generally going to invest a good bit of time making preparations. Of course you want to identify your destination, and you will probably develop an itinerary. And if you are like a lot of people, you will consider all the contingencies that may arise and make sure that you are prepared to handle them.
Life itself can be viewed as a journey, and along these lines it is important to make preparations for all the eventualities of aging. You can’t say with certainty what the future will hold, but what you can do is become aware of the facts, understand the possibilities that lie in wait, and make the appropriate plans for addressing them.
One of the challenges that many people who reach an advanced age experience is that of mental and/or physical incapacity. Believe it or not, upwards of half of the people who are described in geriatric circles as the “oldest old,” those 85 years of age and up, are suffering from dementia. This is largely due to the ubiquity of Alzheimer’s disease. Dementia can make it impossible for its victims to make sound decisions regarding health care and financial matters.
To prepare yourself for this possibility it is advisable to execute durable powers of attorney. With these documents you empower representatives of your choosing to make medical and financial decisions for you in the event of your incapacitation. Because of the fact that they are in fact “durable” they do remain in effect upon the incapacitation of the grantor, unlike standard powers of attorney.
If you do not have an incapacity plan in place a guardian that you did not choose yourself could be appointed to act in your behalf should you be deemed incapable of making your own decisions at some point in time. Most people would prefer to select their own decision-makers, and this is why capacity planning is so important.
- The Magic of Grantor Trusts - November 1, 2023
- IRS Confirms Grantor Trust Status Alone Does Not Cause a Step-Up in Basis - October 26, 2023
- Understanding the Importance of the Simultaneous Death Act - October 19, 2023
