We are often told that we need to plan for what happens after we pass away. We get life insurance to make sure our family is protected, we plan for our funerals, and more.
But it’s important to remember that there are other situations that we may be faced with besides death. For example, we could find ourselves in a situation where we are alive, but incapacitated, and very few of us have plan – financial or otherwise – about what that might look like:
- You might not be capable of managing your finances.
- You might not be capable of communicating with your doctor.
- You might not be capable of signing documents.
That last point is the most important. Incapacity can be gradual, but it can also be instant. Once you’re incapacitated, it may not be possible for you to have any say in who is responsible for your medical and financial decisions, or whether or not someone will be able to manage your wishes. That is why it is best to do it now, while you’re still in control of yourself.
How to Plan for Incapacity
The single most important part of planning for incapacity involves signing a document indicating who your health care proxy is. That is the individual that will be responsible for making medical decisions in the event of incapacity, and they are the ones that will be responsible for most of the important communications and wishes that you have for your health depending on the medical events.
In addition, however, you should consider the following:
- Financial Agent – Someone needs to be in charge of making sure your bills are paid, your taxes are filed, and your mortgage/rent is on time. Typically, determining who has “financial power of attorney” is also something that needs to be completed prior to being incapacitated.
- Living Will – We have wills for the event of our death, but many of us forget to create what are known as “living wills,” which determine care, finances, and other desires in the event that we are alive and incapacitated. It is always a good idea to put these in writing to ensure that what you want for yourself is kept.
- Long Term Care Insurance – Not all incapacity planning is about finding an agent to represent you. Some of it is about making sure that you have the financial support necessary to help pay for the care you may need. That comes from a product like long term care insurance, which ensures that your loved ones or representatives will not need to liquidate assets or be forced to figure out how to pay for it.
There are also trusts, digital asset management, HIPAA authorization, and many others. These are only a few examples of the documentation that should typically be completed in advance, to protect you from unwanted decisions made in your name.
What Happens if You Do Not Have These Documents?
Without these documents, decisions can be made for you. Hospitals, for example, may determine your future. Lawsuits may be filed to handle your finances. In worst case scenarios, delays can cause you to miss critical financial payments, cause unnecessary pain, and more.
If you’re looking for guidance, or you’d like to discuss long term care insurance – and other forms of protection – contact Long Term Care Resources – Pacific Agency (LTCR Pacific) today.