September 21 is World Alzheimer’s Day, a day to bring awareness and challenge the stigma surrounding those with Alzheimer’s and other forms of dementia? Were you aware that, according to the Alzheimer’s Association’s 2020 report, Alzheimer’s disease is the most common cause of dementia, accounting for 60 to 80% of cases? As this degenerative brain disease progresses, a patient’s mental capacity diminishes which can threaten a person’s ability to make legally binding decisions. This means steps should be taken sooner rather than later to put legal protections in place for yourself or a loved one with an Alzheimer’s diagnosis.
Typical symptoms of dementia include difficulties with memory, language, problem-solving, and other cognitive skills that can impact a person’s ability to perform everyday tasks. Once someone is determined by a medical professional as mentally incapacitated, he or she can no longer, legally, make decisions. One major problem with such a situation can be the ability to control one’s finances. Without the ability to express what his or her wishes are, the patient’s exact wishes to manage assets would not be honored.
One way to address this issue may be to have a revocable living trust with an incapacity clause. A revocable living trust is one that the grantor, acting as initial trustee, could make changes while he or she is legally capable. The benefit of this estate planning tool is two-fold. An incapacity clause may allow for a smooth transition from the incapacitated grantor/trustee to a successor trustee. As such, any assets that require immediate attention could be properly dealt with. A properly drafted living trust would set out exact criteria to meet incapacity. This may be more efficient than seeking a court-appointed guardian.
The second benefit of having a living trust may be to maintain control over one’s assets during incapacity. The grantor can appoint a person who is trusted by and familiar with the grantor to be the successor trustee. This successor trustee can faithfully carry out what the patient grantor wishes as directed by the trust or in the patient grantor’s best interests under fiduciary duties.
A living trust with incapacity clause may financially protect the Alzheimer’s patient and his or her loved ones, even when the grantor is incapacitated due to dementia. To find out more about these kinds of legal protections for you and your loved ones struggling with an Alzheimer’s diagnosis, our office is here to help. Feel free to reach out to us to schedule an appointment.