Planning for the possibility that you may need someone else to assist you in managing your affairs
As we age, the likelihood that we will require some assistance to manage our health or financial affairs increases dramatically. By planning for this possibility before it occurs, you can avoid expensive and oftentimes embarrassing Guardianship proceedings.
Why Planning for Incapacity is Important (Example)
Wilhelmina was a 77 year old woman who lived an amazing life. She married her high school sweetheart, Cecil, the captain and quarterback of the football team. They had three wonderful children. They are all happily married, successful, and collectively have given Wilhelmina and Cecil 9 beautiful grand kids.
Wilhelmina and Cecil considered themselves very lucky, as they enjoyed a comfortable retirement together and were as much in love with each other as they were in high school.
Wilhelmina and Cecil both knew that if something were to happen to either one of them that left them unable to manage their affairs, they would take care of each other, and if they couldn’t one of their kids would.
Eventually, Wilhelmina’s health took a turn for the worse, just a few months after Cecil’s health had done the same. Complications from their health issues left both Wilhelmina and Cecil in a compromised situation as neither were able to manage their own affairs.
Neither Wilhelmina or Cecil had their incapacity planning documents in place (i.e. Durable Power of Attorney, Advance Healthcare Directives) prior to this happening.
As a result, Wilhelmina and Cecil’s kids had to go to court and ask for one or more of them to be appointed as the guardian for their mother and father. The court proceedings were open to the public and expensive as multiple attorneys had to be consulted – an attorney for the guardian(s), and an attorney to represent Wilhelmina and Cecil.
Wilhelmina and Cecil’s kids felt the process was demeaning towards their parents as the examining committee appointed by the court evaluated the results of their parents’ physical and mental health examinations in an effort to determine whether their Mom or Dad is totally incapacitated or just partially incapacitated.
The kids found the annual court reporting requirements overwhelming and cumbersome as court approval was required for the kids serving as guardian, to use their parents’ money to repair the roof of their parents’ home that was damaged in a hurricane.
These are just some of the tedious aspects of guardianship proceedings. Much of this could have been avoided had Wilhelmina and Cecil executed a comprehensive estate plan that included comprehensive incapacity planning.
But for the lack of proper estate planning, Wilhelmina and Cecil’s circumstances couldn’t be easier for an estate planning attorney to work with. It was the first and only marriage for both Wilhelmina and Cecil. All the children involved are from that marriage and common to both Wilhelmina and Cecil.
And the entire family gets along with each other. There is zero conflict. Yet still the family found themselves in a really tough and unfortunate situation that could have been avoided.
It is important to have a plan in place before losing legal capacity. Part of a good estate plan prepares for these contingencies. At a minimum, you should have a Durable Power of Attorney, and Advance Healthcare Directives ( Designation of Health Care Surrogate, and Living Will) in place before any of these contingencies occur. In some circumstances, a living trust may be of especially great value as well.
Below are some links with explanations of these legal instruments.
