You can prepare for the possibility of incapacity late in your life by executing a document called a durable power of attorney. With a power of attorney, you name someone else to act on your behalf in a legally binding manner. Durable powers of attorney remain effective even if the grantor of the device becomes incapacitated.
It can be tricky to create a durable power of attorney to account for the possibility of incapacity, because you do not know if you will ever become unable to make your own decisions. When should the power of attorney become effective?
This is a very good question. When you create a legal document, you are going to shape the device to suit your needs.
It is possible to stipulate a date upon which a power of attorney would become effective. However, this is not going to do you much good when you are creating a durable power of attorney to account for the possibility of incapacity because you have no way of knowing if or when you will become incapacitated.
Because of the above, you may want your durable power of attorney to become immediately effective. When you name an attorney-in-fact that you trust implicitly, you should not run into any problems, even though the agent would be empowered to act on your behalf right away.
It is possible to create a power of attorney that goes into effect if and when a certain event takes place. This type of power of attorney is called a springing power of attorney. You could create a springing durable power of attorney that would only go into effect if you were to become incapacitated.
A springing durable power of attorney can sound like the ideal incapacity planning solution because you are not bestowing the power until and unless you become incapacitated. There is certainly some appeal in this, but this type of power of attorney also creates a legal hurdle that must be crossed before the agent can act on your behalf. The interested parties must provide proof that you are in fact incapacitated and unable to handle your own decision-making.
It is also possible to create a durable power of attorney that is immediate as to a certain individual like your spouse, and springing for other individuals.
Incapacity Planning Consultation
A very significant percentage of elder Americans ultimately become unable to handle all of their own affairs. Alzheimer’s disease is the biggest cause of incapacity, striking upwards of 40 percent of those who have reached the age of 85.
If you would like to discuss incapacity planning with a licensed attorney, contact us through this website to schedule a free consultation.