Do You Need a Durable Power of Attorney If You Have a Living Trust?

Incapacity planning is something that you should take seriously when you are devising your estate plan. Unfortunately, many people become unable to handle their own decision-making toward the end of their lives. If you take the right steps in advance, hand-picked decision-makers can be in place to manage your affairs if you ever become incapacitated.

We should point out a couple of facts about incapacity before we proceed, because many people do not take the prospect seriously enough. If you reach the age of 67, your life expectancy is at least 85 depending on your gender. Approximately 45 percent of people who are 85 years of age and up are suffering from Alzheimer’s disease, and this is not the only cause of incapacity.

When you digest these statistics, you can see why incapacity planning is important for all of us.

Durable Power of Attorney

Most people are aware of the fact that a power of attorney can be used to name someone to make legally binding decisions on your behalf. Estate planning attorneys often help clients create durable powers of attorney. A durable power of attorney can be used to name a representative who would be empowered to act if the grantor was to become incapacitated.

A durable power of attorney for health care could be used to name a medical decision-maker. You can also include a durable financial power of attorney to name someone to handle your finances if you were to become incapacitated at some point in time.

The power of attorney would no longer be in effect after you pass away. As a result, the agent that you name to handle your financial affairs would not be empowered to administer your estate after you die.

Revocable Living Trusts

If you were to create a revocable living trust as a vehicle of asset transfer, you would typically act as the trustee while you are alive and of sound mind. In the trust declaration, you would name a successor trustee to administer the trust after you pass away.

The successor trustee would distribute assets to the beneficiaries in accordance with your wishes. These distributions would take place in a timely manner, because the probate process would not be a factor.

The process of probate would come into play if you use a will instead of a trust as an asset transfer vehicle. Probate is a time-consuming and potentially expensive legal process that people often choose to avoid. A living trust can facilitate probate avoidance, but there are other significant benefits that can be realized if you use a living trust as your primary asset transfer vehicle.

When you create the trust declaration, you could empower the successor trustee to administer the trust in the event of your incapacitation. The administrator could also handle the business of the trust after your passing. This is a level of continuity that you would not have if you do not establish a living trust.

The Right Combination

Now that you understand some things about incapacity planning, we can answer the question that serves as the title of this blog post. Even if you have a living trust with a successor trustee who can act for you if you become incapacitated, you should still have a durable power of attorney. You can make the successor trustee the agent under the power of attorney.

When this document is in place, the person or entity that you are empowering could administer the trust, but the representative would also be able to handle assets that you never conveyed into the living trust.

Attend an Upcoming Seminar

In this brief blog post, we have provided some sound but basic information about incapacity, living trusts, and the durable power of attorney. As you can see, there are a lot of facets to take into consideration when you are looking ahead toward the future.

We do everything possible to provide our neighbors here in the greater Naples area with educational opportunities. We regularly update our blog, and there are other informational resources that you can access on our website.

The written information is there for you, but we also provide educational opportunities in person. We hold estate planning and elder law seminars on an ongoing basis, and they are held at various locations, and we offer different starting times. You should be able to find a session that fits into your schedule.

The seminars are free, and you can click the following link to take a look at the schedule: Naples, FL Estate Planning Seminars.

Subscribe to our newsletter

Act now.

Provide protection for yourself and the people you care for.

Take action before it becomes a race against time.

Rely on the Barbara M. Pizzolato, P.A. skilled estate team to shield your work and guide your loved ones.

We specialize in estate planning, incapacity planning, business planning, trust administration, and probate.

Take your first step by contacting us or attending a free estate planning event today.

Time waits for no one.

Skip to content