-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 1
IS INCAPACITY PLANNINGIN NORTHERN
CALIFORNIA REALLY IMPORTANT?
“Your incapacity plan should also address financial
decision-making. If you use a revocable living trust as the
centerpiece of your estate plan, you could empower a disability
trustee to administer the trust if you ever become unable to handle
the tasks on your own.”
TIMOTHY P. MURPHY NORTHERN CALIFORNIA CENTER FOR ESTATE PLANNING
AND ELDER LAW
http://www.norcalplanners.com/
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 2
When you are going through life as a relatively healthy adult,
the prospect of
incapacity can seem alien to you. Of course we all recognize the
fact that elders
sometimes become unable to handle all their own affairs, but it
can seem like
this only happens to a small minority.
While it is not a very pleasant prospect consider, the facts
tell a different tale.
Many people need help with their day-to-day needs because of
physical
limitations, and this is certainly part of the equation.
However, in many cases,
the individuals in question can make sound decisions on their
own, and they
simply need help with certain activities.
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 3
At the same time, there are those who do become incapacitated
physically, and
mental incapacitation can also enter the picture. When it comes
to mental
incapacity, Alzheimer's disease looms large.
You can learn a lot about Alzheimer's disease if you explore the
Alzheimer's
Association website. They devote a lot of time, energy, and
expertise to the
subject, and their work is very valuable.
According to the website, this disease strikes approximately 45
percent of
the oldest old. This term, “oldest old,” is used to describe
people who are at least
85 years of age.
If you are thinking that
only a small percentage of
people live to this age, you
should understand some
longevity data. The Social
Security Administration has a
life expectancy calculator on
its website. Using the tool, if
you were to celebrate your 67th birthday today, your life
expectancy would be
85 years of age or older depending on your gender.
As you can see from the statistics, if you live long enough to
collect Social
Security, and most of us expect to do so, it is likely that you
will reach your mid-
eighties and perhaps beyond. Alzheimer's is a looming threat for
the oldest old,
and there are other causes of incapacitation.
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 4
ADVANCE DIRECTIVES FOR HEALTH CARE
To prepare for possible latter life incapacity, you can devise
an incapacity
plan that addresses the contingencies that you may face. Advance
directives for
health care will be part of the plan.
One part of a California advance health care directive is a
living will.
Doctors can sometimes use life-sustaining measures like
artificial nutrition and
hydration and mechanical respiration to keep terminal patients
alive indefinitely.
Many people would prefer to refuse these measures, and others
would accept
them.
The decision is something that each person should make
individually. When
you execute an advance health care directive in California, you
can state your life
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 5
support preferences, and doctors would be compelled to follow
your instructions
if a life-support scenario should present itself.
Another aspect of an advance health care directive in California
us the
health care proxy or durable power of attorney for health care.
This section is
used to empower a representative to make medical decisions on
your behalf in
the event of your incapacitation.
We should point out the fact that the “durable” designation is
significant,
because a power of attorney that is not durable would no longer
be in effect if
the grantor was to become incapacitated.
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 6
FINANCIAL MATTERS
Your incapacity plan should also address financial
decision-making. If you
use a revocable living trust as the centerpiece of your estate
plan, you could
empower a disability trustee to administer the trust if you ever
become unable to
handle the tasks on your own.
Another option would be the execution of a durable financial
power of
attorney. The agent that you choose would be able to handle your
financial
affairs if you ever become incapacitated.
SUMMARY
A comprehensive estate plan will go beyond the facilitation of
postmortem
asset transfers. You
should also address
potential end-of-life
contingencies when you
are devising your plan.
With an advance
health care directive, you
can record your life
support preferences so
that you can be certain
that your own wishes will
be carried out if you are ever unable to communicate in
real-time. Provisions can
also be added to name hand-picked decision-makers to handle your
medical
decsions in the event of your incapacitation.
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 7
With either a living trust or financial power of attorney, your
financial
affairs can also be addressed.
Action is required if you are unprepared for these
eventualities. If you set
up a consultation with an experienced and qualified estate
planning attorney,
you can embed a sound incapacity plan within a broader,
comprehensive estate
plan.
REFERENCES
American Bar Association
http://www.americanbar.org/groups/law_aging/resources/health_care_decision_
making/consumer_s_toolkit_for_health_careadvance_planning.html
Alzheimer's Association
http://alz.org
http://www.americanbar.org/groups/law_aging/resources/health_care_decision_making/consumer_s_toolkit_for_health_careadvance_planning.htmlhttp://www.americanbar.org/groups/law_aging/resources/health_care_decision_making/consumer_s_toolkit_for_health_careadvance_planning.htmlhttp://alz.org/
-
Is Incapacity Planning in Northern California Really Important?
www.norcalplanners.com 8
About the Author
Timothy P. Murphy
Timothy P. Murphy is an estate planning and elder law attorney
whose practice emphasizes helping people to build, preserve and
pass on their wealth. He works with his clients to accomplish their
goals while avoiding unnecessary court proceedings and minimizing
or eliminating exposure to death taxes. Mr. Murphy also assists
families facing the myriad of problems associated with dealing with
a loved one’s declining
health and rising needs for care. He has practiced law in the
Sacramento area for over 33 years, first with a large firm, and
then with his own firm since 1987.
Tim has written a regular column on legal issues for Senior
Magazine. He also was a regular featured guest on the Money Experts
radio program heard locally on KFBK (AM 1530). Tim has been
featured in the Sacramento Bee, Sacramento Business Journal,
Sacramento Magazine, Comstock’s Magazine and other publications on
estate planning and related topics. He also assisted local Channel
3 (KCRA) in an investigative report on the trust mill problem in
the Sacramento area and was featured on Channel 10 (KXTV) in its
series on personal financial planning.
Northern California Center for Estate Planning and Elder Law
www.norcalplanners.com SACRAMENTO 2277 Fair Oaks Boulevard Suite
320 Sacramento, CA 95825-5599 Phone: (916) 437-3500 ROSEVILLE 3017
Douglas Blvd. Ste. 300 Roseville, CA 95661 Phone: (916)
437-3500
http://www.norcalplanners.com/