Were your power of attorney documents signed in another state?  Are your documents more than three to five years old?  Has an agent named in your power of attorneys moved, died, become disabled, or is no longer appropriate?  Have your children grown into adults and are qualified to help you?  Have your views changed?  If any of these questions are answered in the positive, you need new powers of attorney.

Two Types of Powers of Attorney

Although there are specific powers of attorney for many situations (i.e. real estate closing or a business transaction), there are two main types of powers of attorney.

They are the financial power of attorney and the health care power of attorney.

Financial Power of Attorney

The financial power of attorney is also known as a “general durable power of attorney.”  It is usually effective immediately and authorizes a trusted loved one or corporate entity to pay bills, file taxes, manage assets, and deal with financial institutions.

Health Care Power of Attorney

A health care power of attorney is effective only if you cannot provide informed consent for medical care.  If needed, a loved one will step into your shoes and make health care decisions on your behalf.

Examples of decisions your health care agent would make are which treatment you receive, hiring and firing medical staff, and deciding whether you get a specific operation, or not.

Updating Your Power of Attorney

It’s definitely in your best interest to update your financial and health care powers of attorney.  Consult with a qualified estate planning attorney to do so.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

We understand that it can be overwhelming when a loved one is diagnosed with a serious illness.  There are all kind of family, financial, administrative and legal things to do and you may not be sure what to do or how to do it.  That’s why it’s in your best interest to call a qualified estate planning attorney for guidance.

Testamentary Capacity

A qualified estate planning attorney can determine whether your loved one still has legal competence.  If so, estate planning documents can be put into place so that your loved one’s wishes are carried out and your burden is reduced.

Checklist

A qualified estate planning attorney can provide a checklist of things you need to do and things to think about.  This way you won’t overlook anything.

Legal Advice

A qualified estate planning attorney can help you and your loved ones make important decisions.  Be sure not to take the advice of well-meaning neighbors, bank tellers, or loved ones.  Get good legal advice before making decisions.

Referrals

A qualified estate planning attorney can refer you to other professionals such as geriatric care managers, realtors, financial advisors, appraisers, insurance professionals, home care specialists, hospice care suppliers, etc.

Although it’s always in your loved one’s benefit to take care of these matters before serious illness strikes, it may not be too late.  Consult with a qualified estate planning attorney right away.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

The key to power of attorney effectiveness is to have the legal document in place BEFORE you need it.  The answer to, “When Should I Get a Power of Attorney?” is right now, because once you’re incapacitated (and, actually, need the power of attorney) it’s too late.  You can’t sign a power of attorney if you’re incapacitated.

If you don’t have a power of attorney in place, your loved ones will have to petition the court to have someone appointed a conservator of your estate and of your person.  A conservator of your estate pays your bills, files your taxes, and manages and invests your assets.  A conservator of your person makes health care decisions on your behalf.

The conservatorship process is a loss of control, very expensive, time consuming, stressful, and public.  The court may appoint someone as conservator that you would not appoint for yourself.  Conservatorship is to be avoided.   You can avoid conservatorship by having a financial (i.e. general durable power of attorney) and a medical power of attorney in place.

In addition, if you have minor children, you need a stand-by guardian authorization that works like a power of attorney.  If you are incapacitated and cannot care for your children, the stand-by guardian will step into your shoes, making health care, general welfare, lifestyle, and educational decisions for your minor children.

Any guardian that you name in your will doesn’t have authority to act, without court intervention, because your will is only effective if you’re dead.  If you’re alive, but incapacitated, your will has no affect.

If your powers of attorney are more than three to five years old or if you don’t have them, consult with a qualified estate planning attorney to get them in place now.  The best time to get a power of attorney is before you need it.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Court interference through a conservatorship proceeding is a total loss of control and a preventable drain on financial, time, and emotional resources.  During conservatorship, the court freezes your assets, holds a public proceeding to determine whether you have capacity (or not), and, if it determines that you don’t have capacity, appoints a guardian to manage your assets and your person.  In the case of the guardian of your assets, this may or may not be a family member; the court often appoints a local attorney.

A conservatorship is only necessary if you don’t have your own incapacity plan in place.  If you have an up-to-date, comprehensive incapacity plan, the court will not be involved and you will stay in control.

The Elements of a Comprehensive Estate Plan

The elements of a comprehensive estate plan are a financial power of attorney, revocable living trust, health care power of attorney, HIPAA release, living will, and organ donation authorization.  You can avoid court interference and conservatorship proceedings by consulting with a qualified estate planning attorney and getting these documents in place.

Be Sure to Name Both Primary and Contingent Trusted Helpers

Be sure to name both primary and contingent trusted helpers in each document in case your primary trusted helper is unable or unwilling to serve, when needed.  Even if you have documents but no one is authorized to act on your behalf, conservatorship proceedings will be necessary.

Your Incapacity Plan Must be Updated Every Three to Five Years

Your incapacity plan must be updated every three to five years; if not, it becomes stale and may not be honored. Financial institutions are particularly sensitive to stale documents because they are concerned that the documents may no longer be valid.

Your Incapacity Plan Checklist

In summary, to avoid court interference, a loss of control, and the conservatorship process:

• Consult with a qualified estate planning attorney and execute the appropriate incapacity planning documents.
• Name back up trusted helpers in your documents in case your primary agent or trustee is unwilling or unable to serve.
• Update your incapacity planning documents at least every three to five years.

If you want to avoid court interference and conservatorship proceedings, consult with a qualified estate planning attorney.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Since emergencies can happen at any time, it’s important to plan for possible incapacity. “Incapacity” doesn’t mean that you’re laid up on the couch with a bad back; it means that you are mentally unable to handle your day to day business or financial affairs. Just in the past few months, two friends became disabled, a 46 year old had a stroke and a 43 year old was diagnosed with ALS, Lou Gehrig’s Disease.  Fortunately, you can use an estate plan to prepare for incapacity.  Take a look at the following information, to learn how you can protect your financial affairs during a time of need.  If you have any questions, or if you’d like to review your estate planning documents to make sure they will work, contact an estate planning attorney.

A financial power of attorney is used to protect you and your finances during incapacity.  A power of attorney allows you to appoint an agent who will have the authority to handle your financial affairs when you cannot.  He or she will have a number of responsibilities including paying bills, making deposits and withdrawals, filing and paying taxes, and purchasing essential items on your behalf.  You’re able to control how much authority is given to your agent.  This is a great way to ensure that your financial affairs will always be in order.

Many people choose to create a revocable living trust.  This tool can also be used to prepare for incapacity, and to ensure that your financial affairs are always in order.  You can determine the definition of your disability (i.e. when you’re disabled) and what happens when you become disabled.  In other words, you leave instructions for your disability agents in your trust.  The trust is an instruction book.

Make sure that you have a plan in place for the future; you need it.  Many people neglect the need to plan for incapacity.  Not having a plan in place may mean that you will have no control over your financial affairs and that the court will intervene.

If you’d like to review your current estate plan, and include incapacity planning, consult with a qualified estate planning attorney.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

If you’ve attained the age of 18, this estate planning preparation test applies to you.  Why?  Because each and every adult needs an estate plan to protect himself or herself as well as the family.  If you don’t create your own estate plan, the courts and state law will create one for you; and, it likely won’t be what you’ve chosen yourself.

• I have a will, naming guardians and contingent guardians for my minor children.

Yes    No    Don’t Know

• I have stand-by guardianship authorization for my minor children.

Yes    No    Don’t Know

• I have a valid and up-to-date health care power of attorney so my chosen loved ones can make emergency medical care decisions for me if need be.

Yes    No    Don’t Know

• I have a valid HIPAA release so that my medical professionals are authorized to communicate with my health care agents.

Yes    No    Don’t Know

• I have a valid living will so that I am not hooked up to machines if I am in an irreversible coma or persistent vegetative state.

Yes    No    Don’t Know

• I have a valid and up-to-date financial power of attorney so my chosen loved ones can make emergency financial decisions and pay my bills for me if need be.

Yes    No    Don’t Know

• My revocable living trust is fully funded so probate will be avoided.

Yes    No    Don’t Know

• I have the appropriate amount of life insurance so my income will be replaced and last bills will be paid when I die.

Yes    No    Don’t Know

• I have planned to avoid unintentionally disinheriting my children.

Yes    No    Don’t Know

• I have protected my spouse’s and children’s inheritances from predators and creditors.

Yes    No    Don’t Know

• My family knows my wishes for my funeral and burial.

Yes    No    Don’t Know

Unless you can answer “yes” unequivocally to each and every statement, you likely need to have your estate plan updated.  Consult with a qualified estate planning attorney for a review and update.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Funding your revocable living trust is almost, but not quite, as important as establishing your trust in the first place.  If you want your estate plan to work, your trust needs to be funded.  Failure to do so creates a hassle and costs more money.

Consequences of NOT Funding Your Trust

• The trustees you’ve named as disability trustees in your revocable living trust will have no authority to manage assets not funded into your trust.

• A conservatorship proceeding will be required if you become incapacitated and make your own financial decisions.  This means that your loved ones will have to go to court to have someone named to take care of your money and other assets.  The court may not necessarily name the same person you would have chosen.  In fact, in some circumstances, a stranger may be named to handle your money.

A conservatorship is a loss of control, takes time, is a hassle, and can be emotionally traumatic for you and your loved ones.  It’s costs a lot of money too.

• If you own assets in your individual name when you die, probate is guaranteed.  Many people seek to avoid probate because it’s extremely expensive in California.  In addition, it takes a long time to settle and get assets to the beneficiaries; and, it’s a public process, with personal financial and beneficiary information published at the court house.

• If you own assets in your individual name in a state other than the one you resided and died, ancillary probate will be guaranteed.  It’s double the trouble:  2 court systems, 2 lawyers, 2 accountings, and the like.

• You may unintentionally disinherit your children.  If you own assets jointly with your second spouse (i.e. not the parent of all of your children), and you die first, your children will be disinherited.

• You may waste your full federal estate tax exemption and all the good tax planning in your trust.  If you own assets jointly with your spouse, they will pass tax free at your death.  That may sound good, but, in reality, that just means that the taxes were delayed, not eliminated.  The taxes must be paid at your spouse’s death.

Where to Get Help with Trust Funding

Your estate planning attorney, banker, financial advisor, and insurance agent can all assist you with the funding of your revocable living trust.  It’s a lot of paperwork, but it’s worth it to make sure that your estate plan works.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Imagine the stress, the painful burden, of life and death without a living will.  By having a living will in place, you avoid your family having to “pull the plug” and live with the guilt, even though misplaced, for the rest of their lives.  A living will can help your family find peace as they know that there is no hope of your recovery and that you wish to die in peace, without pain and medical heroics such as life support.

Jackson’s mother, Ellen, collapsed in her home after suffering from poor health for years.  The housekeeper called 911 and Ellen was rushed to the hospital.  She was placed on life support with no hope of recovery.

Jackson received the tearful, near hysterical, call from the housekeeper.  He rushed to the hospital, but grabbed Ellen’s estate planning binder on his way out the door.  When he reached the hospital and received the doctor’s prognosis, he paged through the binder and pulled out Ellen’s living will.

The doctor shook her head and explained, that, yes, under the circumstances, the living will would apply.  Ellen was in an irreversible coma.  Life support would be removed when Jackson was ready.

Jackson called his sisters and all the grandchildren who came to the hospital over the next day and said good-bye.  Life support was removed and Ellen died a few moments later.

Jackson and his sisters were in mourning, but knew that their mother was at peace and that they had carried out her wishes.  This helped them to feel at peace as well.

If you don’t want to have medical heroics such as life support machines artificially extend your life and you want to remove the burden of making that decision from your loved ones, execute a living will.  Your estate planning attorney can help you.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Terri Schiavo told her husband, Michael, that she didn’t want to be hooked up to machines if anything happened to her.  And, something did happen to her.  Terri collapsed in her home February 25, 1990.  And, because her wishes weren’t in writing, there was no legal clear and convincing evidence of her wishes. 

Her parents, Robert and Mary Schindler, felt that Terri was conscious.  Medical doctors and her husband did not.  In fact, the doctors insisted that she was in a persistent vegetative state with no hope of recovery.  A court battle ensued.  Meanwhile, Terri continued to “live” hooked up to machines while her brain withered into nothingness. 

How much did Terri suffer?  How much stress did this cause the Schindler and Schiavo families?  How much in attorney fees?  How much money did this cost Florida taxpayers for Terri’s medical care?  Would you want this to happen to you or someone you loved?

Feeding tubes were finally removed March 18, 2005 and Terri died March 31, 2005.  Her brain had atrophied into nothingness, only the brain stem remained.

Just from a legal standpoint, this case involved 14 appeals as well as many motions, petitions, and hearings in Florida courts. There were 5 law suits filed in federal district court, and 4 denials of writ of certiorari from the Supreme Court of the United States.  Congress and then President George W. Bush got involved.

All of this, even though Terri never regained consciousness after she collapsed in her home more than 15 years earlier. 

All of this is why you likely want a living will.  If you’re like most people, you want to maintain control over your person and your finances.  If you can make a health care decision for yourself, you likely want to make that decision, not leave it to a family battle and the courts. 

A living will is only effective if you are in a persistent vegetative state or an irreversible coma.  If you wish to avoid being hooked up to machines and having your life artificially extended, you need a living will.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.

Elder abuse runs rampant in our society.  You can help to prevent and stop financial elder abuse by being aware that it exists and of its signs.

MetLife Mature Market Institute and the Center for Gerontology at Virginia Tech just released a study indicating that the elderly are victims to financial abuse by close family members, friends, neighbors, and strangers. 

Women are more likely to be victims than men and men are more likely to be the perpetrators than women.  Those who live alone are targeted most often.  It seems the “ideal” target for financial elder abuse is a woman in her eighties, who lives alone, but needs some help.

This financial abuse isn’t nickels and dimes.  Annually, about 2.9 million dollars are unscrupulously taken from elders each year.

Signs of Financial Elder Abuse

• Secret relationship or marriage between elder and caregiver
• A new friend separates or distances elder from family and friends
• Someone tells your elderly loved one that he’ll take care of her until she dies if she gives him all of her money
• Missing family heirlooms
• Missing money
• CDs are cashed in even though there are penalties
• Change in account beneficiary or account owners
• Change in deed or mortgage
• Numerous account withdrawals
• Sudden unexplained change in estate planning documents such as wills, trusts, or powers of attorney
• Inappropriate or unexplained gifting to friend, neighbor, family member, stranger, church, or other charity
• Missing credit card bills or unexplained credit card charges
• Elder is uncomfortable or can’t answer questions about finances
• The same telemarketer calls more than once
• Someone has an unexplained interest in your elderly loved one
• Financial activity that couldn’t have been completed by elder such as ATM withdrawal by physical or mentally impaired elder

If you suspect financial elder abuse, report it immediately.  You can make a difference.  Don’t hesitate.

Legacy APC, A Trusts & Estates Law Firm is a member of the American Academy of Estate Planning Attorneys.