Planning for the Possibility of Incapacity

No one can predict the future with any certainty, but we can put in place plans that can help us deal with unforeseen issues and events, such as the possibility of incapacity. According to the California Society of CPAs (, there are legal documents you can use to appoint someone you trust to handle your legal, financial and health care matters in the event you are mentally or physically unable. Following are explanations of these documents to help you better understand the actions you can take now to manage your future.

Durable Power Of Attorney

A power of attorney is a legal document in which you authorize an agent, usually a trusted relative or friend, to handle legal and financial matters on your behalf. A durable power of attorney is essentially the same, except that it contains specific language stating that you would like the durable power of attorney to continue after you are incapacitated. This is what makes it "durable" and what differentiates it from a regular power of attorney, which ceases to be valid when a person becomes incapacitated.

A durable power of attorney can be prepared so that it goes into effect as soon as you sign it. You can also specify that the durable power of attorney not go into effect until triggered by a specific event, such as when a doctor certifies that you are incapacitated. This is called a "springing" durable power of attorney; it springs into effect later.

Typically, people give their agent broad power to handle their financial and legal matters. But your power of attorney can give your agent as much or as little power as you choose.

Advanced Directives for Health Care

Advanced care directives are specific instructions, prepared in advance, to communicate your wishes regarding the medical care you would want to receive in the event you are unable to make medical decisions on your own. Advanced care directives may also be used to designate someone you trust to make those decisions on your behalf if you cannot.

A living will and/or a durable power of attorney for health care are the two most common types of advanced care directives. These legal documents also serve to relieve family members from making difficult decisions at a time of great stress.

Advanced directives are revocable and can be revised if you change your mind about any aspect of the document.

Living Will

A living will is a legal document you prepare while you are legally competent. It instructs your physician and other healthcare providers to implement, withhold, or withdraw life-sustaining treatment in the event of a terminal or irreversible condition. By executing this document, in effect, you specify how you feel about the use of ventilators, tube feeding, dialysis, and other heroic measures used in terminal illnesses.

This directive goes into effect only when an attending physician certifies in writing that the patient is suffering from a terminal or irreversible condition, and is no longer able to make decisions for him or herself.

Durable Power Of Attorney for Health Care

With a durable power of attorney for health care, you may designate a trusted family member or friend to make health care decisions according to your wishes should you become incapacitated.

This document is different from a living will because it includes all health care decisions—health care providers, medical treatment and end-of-life care—not just life-sustaining ones. The durable power of attorney for health care can be as specific as you like, or it can be very general, relying on the judgment of the agent you've nominated.

Consult With a CPA

Prior to having an attorney draw up these legal documents, you may want to consult with a CPA to review your financial matters.

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