Incapacity means you are unable to make decisions for yourself. Incapacity may result from an injury, dementia, stroke, heart attack, etc., and may be temporary or permanent. Incapacity planning is becoming increasingly important, especially with the rise of dementia.
Just as we can’t predict when we will die, we can’t predict when we might become incapacitated. Every adult should plan for incapacity, because once you become incapacitated, it’s too late to plan for it.
If you fail to plan for incapacity and you become incapacitated, California law requires that your family file a conservatorship action so the probate court can appoint someone to make your decisions for you. Your family will have file a conservatorship action and pay the conservatorship filing fees even if you don’t have a penny to your name.
Incapacity planning documents include:
- Power of Attorney
A power of attorney names an agent who is authorized to manage your finances.
- Advanced Healthcare Directive
An advanced healthcare directive or living will names an agent to make your health decisions and gives instructions on your preferences
- Living Trust
A living trust is the most effective incapacity planning document because it also your property to be immediately titled in the trust and names you as the beneficiary while you are still alive.
- Business Succession planning
If you own a business, you should consider how the business will continue to operate without you.