By Failing to Prepare You Are Preparing to Fail

How many of us plan adequately for a lifetime disability? Leaving your planning to chance and unforeseen circumstances will only breed disaster. If you are unable to handle your own affairs (business, financial and personal) who will do so for you? Chances are before we die that we will all suffer a debilitating illness such as a stroke, injury, accident, Alzheimer’s or old age.

Did you know that if you do become incapacitated you will become subject to a LIVING PROBATE? In Michigan a probate proceeding for your health care and personal decisions is called a Guardianship and a probate proceeding for your financial decisions is called a Conservatorship. Here we will use the term “Guardianship” to cover both probate proceedings. It is a common misunderstanding to believe that your spouse, child or relative can act for you during a disability. The truth is, if you cannot make your own decisions or sign your name, a court will.

A guardianship is designed to protect people who cannot protect themselves. The Guardianship process is a product of a court system that is as efficient as the Post Office, has the compassion of the IRS and is as cost effective as the Pentagon. Sally Hurme, a lawyer for the AARP said, “Guardianship is a drastic remedy, a cannon used to swat a fly.” Frankly, a Guardianship is not necessary. In fact, the probate process , whether it is a “Living or Death” Probate is optional. It is your choice.

What can be done to protect yourself in the event of a lifetime disability? There are three alternatives. The first is doing nothing and subjecting yourself to probate. The second is to establish a Revocable Living Trust. This will be the subject of a future article. The third is to create a DURABLE POWER OF ATTORNEY. This is the cornerstone of all planning.

The word “Durable” means that it is different from an ordinary Power of Attorney in that it is not affected by a person disability or incapacity. Once you grant a Durable Power of Attorney, as long as you are competent you can revoke it. The only time a Durable Power of Attorney terminates is upon death, voluntary revocation or by Court order. Simply put, a Durable Power of Attorney is a legal document that allows you to delegate your personal health care and financial responsibilities to an agent. An agent is a person in whom you have confidence and trust, so that later, if you become mentally or physically disabled, a Guardianship proceeding will be unnecessary.

The authority you give your agent can be as broad or narrow as you choose. The authority can be effective only when you become disabled as you define or effective immediately. For example, any or all of the following can be authorized: protecting your assets in the event that you need long term care (including nursing care), banking transactions, dealing with real estate and personal property, handling legal claims, entry into a safety deposit box, preparing tax returns, contracting for services and consenting to medical care and decisions. As Elder Law attorneys we usually draft Medical Durable Power of Attorneys to address end of life and mental health decisions when one is unable to participate (incapacitated) in their decisions. However, in light of federal privacy acts such as HIPAA and the need to be involved in one’s care before a crisis we address day to day medical decisions to be effective immediately.

It is very simple. Instead of dealing with the emotional trauma, financial costs and the delay of Probate – Guardianship, you will be able to devote your efforts to caring for your loved ones during their incapacity.

A Durable Power of Attorney is not only for the elderly – everyone over the age of 18 should have one. Anyone, no matter their age can be involved in a car accident, hospitalized or unable to handle their affairs for lengthy periods. This is why you should plan NOW!

No one wants to think about their own mortality or incapacity. Do yourself a favor and stop procrastinating. Plan NOW for yourself and if not for yourself, for your loved ones. Remember what a wise man once said, “By failing to prepare you are preparing to fail.” That man was Benjamin Franklin.

– Don L. Rosenberg, The Center for Elder Law