If your elderly parents have not yet drafted an estate plan, you may be in store for some headaches after their death. In addition to having to deal with family disputes, you may be at risk of losing out on some or all of your inheritance.
As individuals age, they often become increasingly vulnerable to dementia and other mental health issues. Even though having an estate plan helps your parents retain control over what happens to their assets, you must be certain your mother and father have testamentary capacity when they write their estate plan.
The purpose of testamentary capacity
For your parents’ estate plan to be legally valid, they must be of sound mind when they create it. This legal requirement is necessary to ensure wills and other estate planning documents do not stem from fraud, undue influence or coercion. Consequently, if someone can prove your parents lacked testamentary capacity, he or she may have legal grounds to contest the estate plan in court.
The requirements for testamentary capacity
To have testamentary capacity, your parents must have the mental faculties necessary to carry out the estate planning process. This may require the ability to do the following:
• Understand the legal effect of developing an estate plan
• Comprehend assets and liabilities
• Identify beneficiaries
• Appreciate the consequences of estate planning actions
The line between testamentary capacity and incapacity is not always clear, as individuals tend to lose testamentary capacity over time. Therefore, you may need to have regular discussions with your parents to ensure they continue to have sound minds throughout the entire estate planning process.
Ultimately, if you are close to your mother and father, you may be in an optimal position to protect them from anyone who may be trying to take advantage of them.