Creating a comprehensive estate plan to ensure that your estate assets are distributed according to your wishes is certainly important. What you may not realize, however, is that planning for the possibility of your own incapacity is equally important. The Glastonbury living trust lawyers at Nirenstein, Horowitz & Associates, P.C. explain how incorporating a living trust into your overall estate plan can help protect you against the possibility of your own incapacity.
Why Is Incapacity Planning So Important When I Am Still Young?
People view the possibility of incapacity as a problem that only affects the elderly. While it is true that your odds of becoming incapacitated will increase with age, incapacity can strike at any time and to anyone. Consider the following facts and figures:
- Just over 1 in 4 of today’s 20-year-olds will become disabled before they retire.
- Over 37 million Americans are classified as disabled; about 12% of the total population. More than 50% of those disabled Americans are in their working years, from 18-64
- An otherwise healthy 35-year-old female has a 24% chance of becoming disabled for 3 months or longer during her working career.
- An otherwise healthy 35-year-old male has a 21% chance of becoming disabled for 3 months or longer during his working career.
- The average length of disability for that 35-year-old female or male is 82 months.
Moreover, if you do suffer a period of incapacity, being prepared is crucial. The best way to understand the need for incapacity planning is to take a minute and consider what might happen if incapacity were to strike tomorrow. Can you answer the following questions?
- Who would make healthcare decisions for you?
- Who would make personal decisions, such as where you will live, for you?
- Who would take over control of your finances and pay your bills?
- Who would manage your assets and property while you are unable to do so?
Without an incapacity plan in place, the answer to each of those questions remains unclear. In a worst case scenario, your family members might end up in a protracted legal battle over the right to make decisions for you and/or manage your assets. Not only would this cost a small fortune but it could create a rift in your family that might never mend. The way to avoid this is to make your wishes known now and create the legal framework by which those wishes must be implemented in the event you ever do suffer a period of incapacity.
How Can a Living Trust Help?
A revocable living trust is a very popular incapacity planning tool for several reasons. As the Settlor of the trust, you create the trust and name yourself as the Trustee. You then name the person you would want to take over control of your assets in the event of your incapacity as the successor Trustee. Assets are then transferred into the trust. As the Trustee, you continue to have access to, and control over, those assets just as you did before creating the trust. If, however, you become incapacitated, your successor Trustee takes over as the Trustee automatically. As the Trustee of the trust, your chosen successor now has control of the trust assets without the need to involve a court or do anything else. Because it is a revocable trust, you also have the ability to move assets in and out of the trust as needed and to replace the successor Trustee with someone else if the need arises. In addition, as the Settlor of the trust, you even have the ability to use the trust terms to define “incapacity” or to set up procedures to be followed to determine under what conditions the successor Trustee should take over as Trustee.
Contact Glastonbury Living Trust Lawyers
For more information, please download our FREE estate planning worksheet. If you have additional questions or concerns about how to use a living trust within your incapacity plan, contact the experienced Glastonbury living trust lawyers at Nirenstein, Horowitz & Associates, P.C. by calling (860) 548-1000 to schedule an appointment.