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Have you ever thought about who would make decisions for you if you couldn’t? Imagine suffering a stroke, or developing dementia, or experiencing some other form of mental incapacity. Most people mistakenly believe that their will or living will covers everything. But what happens when you’re still alive yet unable to make decisions for yourself? The situation requires careful consideration, which is why I want to explore why incapacity planning

is just as important as planning for what happens after you’re gone. In this discussion, I’ll share the essential documents needed to ensure your wishes are honored and your family remains protected during difficult times. I’ve witnessed firsthand how families struggle without a clear incapacity plan in place. These situations often lead to court proceedings, family disagreements,

and tremendous unnecessary stress. However, with the right planning in place, these issues can be completely avoided. My name is Ted Gudorf, a board certified estate planning attorney, and I’ve been practicing law since 1986. Throughout my career, I’ve helped thousands of families avoid unnecessary court intervention and ensure their loved ones maintain control even during challenging times. Let’s first examine what happens

if you don’t have incapacity documents in place. Stay with me for the next few minutes. This information could save your family significant pain and heartache down the road. Without the proper planning in place, your loved ones may need to petition a court for permission to manage your affairs, make health care decisions, or even sell your home if necessary. This process, known as guardianship,

or possibly a conservatorship can be extremely expensive, time consuming, and emotionally draining. Perhaps worst of all, the court might appoint someone you wouldn’t have chosen to make these critical decisions for you. I worked with a family several years ago where there was nothing complicated about their situation, no controversy, and everyone agreed on what should happen. We filed the appropriate probate petition and nobody contested it.

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yet simply due to the inefficiencies of the local court system in that particular case, it took almost nine months to get someone appointed as guardian. During that interim period, no one had access to the parent’s checking account to pay bills, handle mortgage payments, or address any other financial necessities. Additionally, there was no authorized person to make medical decisions. This example illustrates how significant time delays can occur even

when there are no disputes or particular problems. It’s simply part of the probate process in many jurisdictions. I had another client whose incapacity led to her children fighting over who should take charge of her affairs. One child filed a petition to be appointed as a guardian while the other opposed it. The back and forth battle created enormous problems and took considerable time to resolve.

It became extremely expensive because both sides hired attorneys, generating substantial legal fees. There were multiple court hearings and proceedings that, in my professional opinion, are situations everyone should try to avoid if possible. If you’ve ever witnessed a family endure this kind of ordeal, you understand how emotionally and financially draining it can be. These experiences often lead lasting impacts on families.

sometimes creating rifts that never fully heal. The good news is that we can avoid these difficulties with some relatively straightforward planning. I’ll explain what these essential documents are and then discuss what I believe is the most rock-solid approach to incapacity planning. Let’s start with the essential documents that everyone over the age of 18 should have. The first is a durable power of attorney.

This critical document allows you to appoint someone you deeply trust as your agent, legally called an attorney in fact. This person can step in and manage your financial affairs if you become unable to do so yourself. It’s important to understand that powers of attorney can be structured in different ways. You can create an immediate power of attorney where your agent has the authority to act on your behalf right away.

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Or you can establish a springing power of attorney, which only takes effect under specific circumstances, as outlined in the document. Now, many people initially think a springing power of attorney sounds ideal, because it doesn’t activate unless something happens. But let me explain how this works in a practical sense. A springing power of attorney typically requires something along the lines of two independent doctors.

rendering opinions that you can no longer manage your affairs. While this sounds reasonable in theory, the reality can be quite challenging. Consider how difficult it can be to schedule doctor’s appointments these days, often taking months to get on the calendar. Now imagine your loved one is incapacitated and you need to secure not just one but two separate written medical opinions from different doctors.

If your loved one isn’t already a patient of both doctors, you’ll need to go through the entire new patient process, which can add considerable time and stress to an already difficult situation. You could potentially name individuals you trust to make these determinations about your capacity, such as close friends or family members, whom you’re confident could evaluate whether you’re capable of managing your affairs. However,

This approach presents some practical challenges. In my professional experience, I generally prefer an immediate power of attorney. My reasoning is pretty straightforward. If you don’t trust someone enough to give them immediate power of attorney, they probably shouldn’t be named as your attorney, in fact, in the first place. The second essential document involves health care directors. This document allows you to name an agent to make medical decisions on your behalf.

and generally provides a way for you to express your wishes regarding end-of-life treatment. In some states, this might be split into separate documents, like we have here in Ohio, a living will and a durable power of attorney for health care, while other states combine them into a single document called an advanced directive for health care. Though there are variations across different states, the fundamental concept remains consistent.

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you’re appointing someone to make healthcare decisions for you when you’re unable to communicate effectively with medical professionals. This is an incredibly important document that can prevent tremendous family strife. You may remember the case of Terri Schiavo. Remember, she was in a persistent vegetative state with no response to stimuli. Because she hadn’t created any written document stating her wishes regarding end-of-life treatment,

Her family spent more than a decade fighting over whether life support should be continued or withdrawn. The case went to the Supreme Court multiple times before her husband was eventually given the right to make that decision, and her life support was ultimately withdrawn. This is precisely the kind of painful situation you want to spare your family from experiencing.

By naming someone you trust to make medical decisions and providing them with clear instructions about your wishes, you create a roadmap for them to follow during an incredibly difficult time. Some people mistakenly believe that having an advanced directive might allow doctors to do something against their wishes. But I believe that perspective misses the point. An advanced directive that clearly articulates your preferences

will be an invaluable resource for your family and will allow your chosen agent to make decisions with confidence knowing they’re honoring your expressed wishes. third essential document is a HIPAA release. HIPAA, H-I-P-A-A, stands for Health Insurance Portability and Accountability Act, which is a privacy law that restricts medical providers.

from sharing your information with anyone unless you’ve given them specific permission. While protecting patient privacy is certainly important, this law also has some unintended consequences. Anyone not explicitly listed on your HIPAA release cannot access your medical information. Consider a scenario where you have a child living across the country who needs information about your condition after you’ve been hospitalized. Without a properly executed HIPAA release,

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Healthcare providers won’t be able to share any details about your medical treatment with them. Since HIPAA is a federal law, we prepare releases for our clients that specify in advance exactly who should have access to their medical information. This preparation is crucial because if you’re unconscious or otherwise unable to sign a release when you’re admitted to the hospital, having this document on file

ensures that authorized family members can communicate with your health care providers about your condition and treatment options. We also recommend storing these vital documents in a manner that allows authorized individuals to access them easily when needed. At our firm, we utilize a service called legal directives for our clients, though other companies provide similar services.

This isn’t a paid endorsement, but simply a practical suggestion based upon my years of experience. Legal Directives stores copies of your essential documents and provides you with a wallet card containing a toll-free number and PIN number. If you’re hospitalized, the intake personnel or your doctor can call Legal Directives and have these documents immediately emailed or faxed to the hospital.

ensuring they’re available whenever and wherever they’re needed. If you’d like a free checklist to help assess where you stand with your incapacity planning, you can visit our free resources page and download our comprehensive estate planning checklist. This tool will help you identify potential gaps in your current plan so you can address them proactively rather than leaving your family to deal with the consequences later.

Let’s discuss how a living trust can make all of this significantly easier. Remember, a living trust isn’t just for transferring assets after you pass away. It plays a crucial role during your lifetime if you become incapacitated. That’s precisely why it’s called a living trust. In other words, it exists and functions while you’re still alive. Here’s how it works. First,

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It provides an automatic transition of control. When you create a living trust, you name a successor trustee who can step in immediately to manage your assets if you become unable to do so yourself. This arrangement completely avoids the necessity for conservatorship or guardianship proceedings. With a properly established living trust, there’s no need to present a power of attorney.

at financial institutions to demonstrate authority. The successor trustee powers are already built in to the trust document itself. This approach eliminates any court involvement, as there’s no need for court-appointed guardianship to manage assets held within the trust. Your trustee simply takes over management responsibilities immediately, without delays or legal complications. Additionally,

A living trust provides comprehensive asset management capabilities. Your trust can include detailed instructions for how you want individual assets handled, how your finances should be managed, and ensure that your bills are paid and assets protected without any of the delays we discussed earlier. A living trust, when combined with the other incapacity documents we’ve covered, gives you the most comprehensive protection possible for yourself and your family.

So to recap, effective incapacity planning requires more than just having a will or trust in place. You need key documents like a durable power of attorney, health care directives, whether that’s an advanced directive for health care or a separate living will and durable power of attorney for health care documents, depending on your state, and a HIPAA release. I understand this can seem complicated, but these documents are absolutely essential.

By having these documents properly prepared and incorporating a living trust into your planning, you can create a smooth process with clear guidelines for who takes control and how your assets are managed if something happens to you. Planning for incapacity isn’t always comfortable to think about, but it’s an essential component of responsible estate planning. Take action now.

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while you’re able to make these important decisions yourself, rather than leaving loved ones to navigate complex waters without guidance. Your family will thank you for your foresight, even if they never need these documents. Not sure if you need a living trust? Think only the wealthy need this type of planning? Many families believe trusts are just for the ultra-rich, but that is simply not the case.

Watch this video right here in the upper left of your screen, where I explain all of the reasons most people should consider a living trust, regardless of their wealth level. You’ll discover how a trust can protect your family, simplify the transfer of assets, potentially save on taxes, and provide the comprehensive incapacity protection we discussed today. Don’t miss these essential insights that could make all the difference.

for your loved ones.