Things That Go Bump in the Night…

In honor of the recent Halloween holiday, I thought I’d talk about the scariest part of it: the tricks.  Elderly individuals, even with estate plans, are frequently the victim of financial abuse by caretakers, children, and living facilities.  Even independent trustees and attorneys have been known to take advantage of their clients’ estates for all manner of personal gain.  Protecting yourself against the possibility of financial abuse while maintaining complete control over your finances and estate plan can be very difficult.

Financial abuse often comes from the person closest to the elder.  Sometimes it is a family member who undermines others by convincing the elderly person that other family members are trying to take advantage of them or that the other family members have already stolen assets.  In cases where even minor dementia is present, the elder is often confused about their total assets or where items seem to have gone.  This presents an opportunity for the conniving family member or caretaker to place blame on someone else.  The elderly person may then change their distribution plan in their trust to disinherit one person in favor of the offending caretaker or family member.  Other fiduciaries may be more brazen; those with access to financial accounts may treat themselves to the assets or charge unreasonably high fees for their services.

Unfortunately, for those who wish to protect themselves, there is a fine line between deciding to reward someone for their help during a time of need and being manipulated into changing an estate plan!  In the effort to maintain financial autonomy for as long as possible, trusts are often drawn with relatively loose provisions that do not account for the decline into incapacity.  However, there are some measures you can take in your estate plan that may help.

First, when a determination of your capacity is necessary, you may appoint specific individuals to help make the determination.  You might specify your primary care physician so that a one-time exam from an arbitrary physician is not sufficient to determine your level of capacity.  Instead, your main physician who knows you is charged with deciding.  You may also appoint a family member or panel of family members who are familiar with your daily routines to determine changes in your awareness and behavior.

Another option may be to appoint co-trustees or a financial power of attorney and trustee who differ from one another.  Although there are a number of potentially unnecessary complications that arise with too many hands in the pot, there is added safety when your fiduciaries must clear actions through each other or act unanimously.

Perhaps most importantly, you should ensure that caregivers, assisted living or nursing facilities, and professional fiduciaries have been checked out.  Before choosing a provider or appointing a professional, get references, qualifications, and information about their procedures, ethical understanding, and processes.  Additionally, find out whether there is a system for responding to and addressing complaints.

You work your entire life to build your estate and have it distributed according to your wishes.  By being vigilant early on, you may prevent the squandering of your estate by unscrupulous family members, aides, and advisors!

Estate Planning: The Price of Organization, Rewards, Gifts, and Wondrous Tax Things… FREE REPORT: This complimentary report, focused on Estate Planning, is comprised of many of Mr. Miller’s articles from his long running column for the largest regional newspaper in San Diego County. This report will guide you through the questions surrounding getting your estate planning in order.

2015