Ohio Elder Law and Estate Planning

Facebook User's Death Can Cause Estate Planning Problems

2012-02-14T13:45:00.003-05:00

What happens to a Facebook account when the user dies? I previously wrote about how protecting your "virtual assets" is an important piece of estate planning, and this issue is proving to be important as Facebook is bearing the brunt of some complaints from unhappy or frustrated family members of deceased users.

Steve Eder of the Wall Street Journal writes in "Deaths Pose Test for Facebook":

As people's online personas become an increasingly important part of their lives, families and friends are encountering confusion and frustration in trying to manage the Facebook, Twitter and email accounts of their deceased loved ones.

What Are The 2012 VA Aid and Attendance Pension Payment Rates?

2012-01-24T15:44:00.002-05:00

For 2012, there are brand new VA Aid and Attendance Pension rates. These updated payment figures reflect an increase in Basic pension, Housebound, and Aid and Attendance rates and are in effect as of December 1, 2012, which means the larger checks were first issued on January 1, 2012.
Read more »

Does A Revocable Living Trust Protect My Assets From Nursing Homes?

2012-01-16T17:34:00.003-05:00

One of the most repeated questions I hear in client meetings or at presentations is "Will a revocable living trust protect my assets from the nursing home?"

In the Medicaid Planning world, misinformation seems to swirl around the public. It seems that many of the families I speak with were specifically told at a seminar that their revocable living trust would protect their life savings from the costs of long term care, and that they would not have spent the money on such a trust otherwise.

How To Discuss Money With Mom & Dad

2011-03-07T08:42:00.013-05:00

Do your mom & dad have enough money to last through retirement? Many children are worried that due to market losses over the past few years, their parents may not have enough to live comfortably through their "golden years". Does this mean that son's & daughters will need to pitch in to keep them afloat? How do you have the "money talk" with mom & dad?
Read more »

Be On the Lookout for Financial Fraud of the Elderly

2011-02-21T08:51:00.012-05:00

It seems that calls to my office that paint a picture of financial fraud of the elderly are increasing. Apparently, the statistics show that 1/5th of Americans older than 65 have been the victim of some sort of financial swindle. That's 7.3 million seniors!

Elder financial abuse is becoming the crime of the 21st century as the growing senior population is increasingly targeted. - Fred Joseph, President of the North American Securities Administrators Association

Caregiver of 38 Years Loses Home to Medicaid Nursing Home Costs

2011-02-12T08:23:00.001-05:00

Will Medicaid take my home if I need to go to a nursing home? How can I protect my house? These are two of the most common questions I hear as an elder law attorney.

On Monday, Rita Price of The Columbus Dispatch published a related story entitled "Thanks to Medicaid, Caregiver Faces Eviction - Forced Sale of Home".

Murrell Lewis cared for owner Alma O'Brien, 94, for 38 years

Price tells the tale of Murrell Lewis, a single man in 1973 with a doctorate in physics that needed a place to live, and Alma Ruth O'Brien, a widow that opened her home to Mr. Murrell.

Beware of Nursing Home Arbitration Agreements

2011-02-01T20:21:00.000-05:00

Nursing Home Arbitration Agreements are something to pay close attention to when entering a nursing home or assisted living facility. Many residents sign these without a second thought, but some commentators characterize these contracts as an "incredible disservice" to nursing home residents and their families.

Why are these considered a "disservice"? Well, some would say these arbitration clauses are often "buried" within 20, 30, or even 40 pages of legalese text, not unlike that which might be seen when buying a car. You might say that this can make it difficult to understand the full terms of the contract.

In a 2009 case, Hayes v. Oakridge Home, the Hayes family alleged that Mrs. Hayes was a victim of negligence, as she suffered serious injuries when she fell from a wheelchair while at a nursing home. The nursing home produced the arbitration agreement indicating that Mrs. Hayes had agreed to forego a lawsuit in favor of binding arbitration.

The family felt that they should not be held to the arbitration clause because:

Hayes lacked any business or contract experience; no one explained the terms of the agreement to Hayes, including the fact that she could alter the agreement; the rescission clause was buried among a myriad of terms, and she was required to fill out numerous other forms at the same time; and there were no alternative sources of supply because finding a quality nursing home is difficult.

Regardless, the court found the clause to be enforceable and the Hayes family did not have the option of following through with the lawsuit in court.

Before you or a loved one signs anything, make sure to read it closely. If you are not comfortable with agreeing to take any complaints or disputes to arbitration rather than court, ask them to strike the arbitration agreement clause, or speak to an elder law attorney before signing.

Steps To Take When A Loved One Dies

2011-01-18T10:12:00.001-05:00

My clients know that if they lose a family member or friend, they can simply call me for help as a Probate and Trust Administration Attorney. Unfortunately, many folks don't even have a will in place, so their family members don't have any written guidance to refer to, and may not even know an attorney that will help them with their questions.

Recently, Portland Oregon Estate Planning Attorney Candice Aiston compiled this helpful list of things to do (edited slightly for Ohio estate planning purposes), which I hope you find helpful,though I don't pretend that it is a complete list.

Notify doctor, coroner, and/or police officer (depends on whether death occurs at home or hospital).
Contact family and friends. Hopefully, the deceased has compiled a list of people to notify in his or her estate plan.
Funeral arrangements. If they're not prepaid, they can be paid from the estate of the deceased. This is also something that the deceased may have expressed wishes about in his or her estate plan. Determine whether the deceased will have military or police officer honors.
Prepare obituary. Again, the deceased should have helped you with this in his or her estate plan.
Contact an Estate Planning Attorney as soon as possible. If there is a Will, it may need to be filed with the Probate Court by a certain date, and the Federal Estate Tax return is due 9 months after the date of death. You may have a state estate tax return as well; the existence and rules vary state to state. You also only have 9 months to decide on the use of disclaimers to save on estate taxes. Without a Will in place, probate may need to be opened depending on the size of the estate. If there is a Trust in place, there will probably be a lot of paperwork that needs to be completed, and this is best handled by an attorney. Also, many states require that estates notify creditors publicly, and the estate must remain open during the statutory time period, so it's a good idea to contact an attorney early on so that the clock can begin.
Use a team of advisors (attorney, CPA, financial advisor). There will be many legal, financial, and tax issues that come up and it's best to have the advice of professionals in those fields.
Locate estate planning documents and asset information. Hopefully, the deceased has communicated his or her plan with you prior to death, and hopefully, the documents aren't in a super secret safety deposit box. Having an attorney to turn to at this point is invaluable.
Arrange care for surviving family and pets. Guardians for minor children must petition the court to have guardianship approved.
Obtain the death certificate. It's best to get several copies, because many of the institutions you'll be dealing with will need a copy.
Secure real and personal property and make an inventory of all personal property.
DO NOT immediately accept benefits (retirement, annuities, investments). Contact your Estate Planning Attorney and inquire about the use of disclaimers. There may be tax savings in doing so.
Create inventory of assets (real property, valuable personal property, bank accounts, stocks, retirement accounts, life insurance, etc.). If the deceased has done thorough planning, a spreadsheet of these assets should be with his or her estate planning materials.
Contact IRS for new Tax ID number for estate or trust.
Compile list of creditors.
Notification for benefits and insurance. Provide employee benefits, insurance, Social Security, and Medicare offices with: Decedent's name, Social Security number, date of death, whether death was due to illness or accident, your name and address.
Other notification: Veterans Pension or Survivor benefits, club and credit memberships, disability insurers, utility companies, homeowners, landlord, anyone providing home maintenance.
If the decedent was a business owner,there are obviously additional items to consider. One is whether the decedent had a Buy-Sell Agreement or other type of business succession plan.

With Identity Theft of Deceased becoming a common problem, Ms. Aiston also provides some tips to avoid identity theft.

Request the deceased's credit reports from the three credit bureaus.
Request that the credit bureaus suppress the deceased's credit file.
Send a copy of the death certificate to all creditors.
Immediately notify Social Security of the deceased's death.
Cancel all of the deceased's ID cards.
Safeguard documents that have the deceased's Social Security number.
Avoid giving too many details in the death announcement (like mother's maiden name, etc.).

As you can see, the amount of work to be done when someone you love passes away can quickly become overwhelming - especially during a time of severe grief. To help ease the burden of those you love, get a will or trust estate plan done.

Make sure that all relevant documents are in one conveniently accessed location. I use a will or trust portfolio (binder) that has tabs for all the legal documents, life insurance policies, retirement plans, memorial instructions, etc. Don't make your family members dig through boxes in the basement to try to construct your financial picture. Give them the gift of having your estate plan completed and your affairs organized.

To get started on the most important planning you'll ever do for your family, call Golowin Legal at (614) 453-5580 to get started.

Combat Veterans Have January 2011 VA Health Care Deadline

2011-01-14T10:38:00.001-05:00

If you are a combat veteran (or know someone who was) that was on active duty between 11/11/1989 and 1/28/2003, sign up online for VA veterans health care. By getting it done before the deadline, you'll get in without having to prove you have a "service connected" disability or health problem. Remember, "once in, always in" - get it done now if you qualify.

Rick Maze of MilitaryTimes.com writes that:

Time is running out for about 180,000 combat veterans, most of whom served in Iraq or Afghanistan, to take advantage of streamlined enrollment into the Veterans Affairs Department health care system.

Mr. Maze quotes Philip Mastkovsky of the Veterans Health Administration as saying that even if veterans do not have health problems right now, there is good reason to enroll in the Veterans Affairs (VA) health plan now. This plan "charges no premiums and requires modest co-payments only when treating veterans for clearly non service-connected reasons."

The biggest reason of all for enrolling when you are not currently facing health problems is that once you're in, you're always in. Maze writes:

The 180,000 affected veterans are among a class of veterans offered no-questions-asked health care from VA following their release from active duty. Initially, they were provided two years of care, but in 2008, when Congress decided to provide five years of post-service VA care to Iraq and Afghanistan veterans, those discharged in the early years of the Iraq and Afghanistan wars were given extra time.

Don't wait! After January 27, 2011, veterans may only enroll in the system if they meet the regular eligibility rules, where you must prove having a a service connected disability or low income. Only 16,000-17,000 of eligible veterans have enrolled so far!After Jan. 27, these veterans can enroll in the VA health system only if they meet regular eligibility rules, such as having a service-connected disability or low income.

You may enroll entirely online right here. If you have questions, call the VA at 877-222-VETS (877-222-8387).

Thank you for your service. For a free guide on Ohio Veteran's Pension Aid and Attendance Benefits, visit www.OhioVeteranPension.com.

Elimination of Ohio Estate Tax?

2011-01-12T19:04:00.000-05:00

Yesterday Ohio House Bill 1 was unveiled, putting the Ohio Estate Tax on the chopping block. Currently, the Ohio Estate Tax is imposed at a rate between 6-7% on estates valued at more than $338,333 when a person dies.

Jim Siegel of Dispatch.com writes that "House Bill 1 [is] usually designated for leadership's top priority" and later mentions that "[t]he estate tax brings in about $245 million a year to local governments and about $60 million a year to the state."

Those opposed to the tax such as Rep. Cheryl Grossman, R-Grove City argue

that the estate tax is unfair, bad for farmers and small businesses and drives wealthier retirees out of the state. Ohio is one of 20 states with an estate or inheritance tax, and its threshold is the lowest in the nation.

Rep. Ron Amstutz calls the estate tax "legalized theft", possibly viewing the tax as 'double taxation' of dollars that already faced the income tax and/or corporate tax.

On the other hand, those in favor of the tax such as Rep. Mike Foley D-Cleveland argue that "local governments rely on the money" and it is "a benefit to society, as it only applies to the wealthiest among us, and helps to slow down the growing wealth inequality."

For years estate planning attorneys have been helping clients to eliminate or minimize the amount of estate tax they must pay on death by using living trusts and inserting tax planning clauses into wills. If the Ohio Estate Tax is eliminated, much of this work may become unnecessary. However, at what cost would this come? Would local governments or the State be harmed drastically? Would the impact only be minimal?

What is your view on eliminating the Ohio Estate Tax? Yea or Nay?

Men From The Forgotten War

2010-04-09T09:23:00.001-05:00

Mike Harden, retired columnist for the Columbus Dispatch, wrote of a gathering of Korean War veterans at the American Legion post entitled "Men from 'forgotten war' recall fateful night". An excerpt follows:

Hunkered over fried bologna sandwiches and Bud Lites, the last men standing from an old Columbus-based Korean War company of Marines assembled on April Fool's Day to discuss a mutual throb in the molar of memory.
The noon drinkers who were bellied up to the bar of the American Legion post on Demorest Road paid scant attention to the assemblage of gray-hairs, who had come together to honor the 60th anniversary of the most harrowing months of their lives.

(To read the remainder of the article, click the link above)

Reading Mr. Harden's article reminded me not only of the "forgotten war", but of how underutilized VA non-service connected pension benefits are. If you have significant medical expenses such as in-home, assisted living or nursing home care and are a wartime veteran (which includes the Korean War), or if you are the widow of a wartime veteran, you could be missing out on up to $23,000 in benefits per year that could help you pay for your medical expenses that are ripping through your savings.

If you know someone that needs more information on VA Pension, have them give me a call or visit OhioVeteranPension.com for a free guide. No veteran or their widow should let this benefit to slip by.

Protect Your "Virtual Assets"

2010-04-06T08:16:00.006-05:00

USA Weekend highlighted a commonly overlooked piece of estate planning in "Create A Plan Now For Your Virtual Assets". Jill Golden asked:

Millions of Americans use e-mail, blogs and social networking sites to stay connected with friends and relatives. But what happens to your accounts after you die?

It seems that we all have online banking & brokerage accounts, Yahoo or Gmail, EBay, PayPal, Facebook, Twitter, and more. When we die, the material stored in these accounts can become unreachable or dissapear unless we ensure our loved ones have access through our login information.

I heard a story of a U.S. Marine who was killed in action while serving in Iraq, and his family was not granted access to his Yahoo! email account due to privacy reasons. This ended up being very traumatic for the Marine's family because they wanted to remember him in his words, and his writings were lost forever when the account was deleted.

The author of this article introduced several companies that will forward user names, passwords and personal instructions to a person of your choosing after your death, which include LegacyLocker.com, AssetLock.net, and MyWebWill.com.

Whether you use one of these web services, or just create a handwritten list of user names and passwords and leave it in a safe-deposit box, make sure that losing access to these "virtual assets" does not cause stress or heartache for those you leave behind.

Minor Settlements In Probate Court

2009-06-30T09:06:00.004-05:00

When a minor is injured and someone else is liable, what happens? How is that child reimbursed for their injuries? Because the child is not old enough to legally settle the claim, the county probate court is going to be involved.

The probate court has the authority to approve the settlement of minor's injury claims, and will decide how the settlement funds are distributed.

The guardian of that minor (or of the minor's estate if they passed away) must file an Application to Settle a Minor's Claim in the child's county probate court. Parents who do not have custody of the child get notice of this application, which must contain the following:

A current statement from a physician that describes the injuries, including their permanency and extent of recovery,
A statment that descibes the circumstances of the injury or damage, as well as treatment program, and
prospective or actuctual settlements from similar incidents (for minors or adults).

The minor child must attend the hearing, and within 30 days after the settlement, there will be an Entry Approving Settlement of a Minors Claim and Distribution and Entry of Minor's Claim to prove the proper distribution of the settlement funds.

If a guardian was appointed, the case remains open until the guardian submits an inventory within three months of their appointment. For settlements over $10,000, a guardian must be appointed. A guardian is not needed for settlements under $10,000.

In the end, the court will chose to do one of the following with the remaining funds:

Release funds to the natural guardian or the minor,
Order the funds placed in a secured account and released to the minor when he or she becomes an adult, or
Place the funds in an annuity that will provide a future source of steady income to the minor.

Thanks to Lora Lynne Stalnaker, who wrote an article that was the basis for this post.

Help Emergency Responders Care for Elderly and Disabled

2009-05-06T14:59:00.003-05:00

An alarming editorial appeared in the Columbus Dispatch recently. Deborah Kendrick in “Emergency responders can worsen plight of disabled victims” recounted a disquieting incident.

Stephen Pyles, 55, is deaf and unable to communicate verbally. After calling 911 because his house was burglarized, the police officer sent to help instead arresting him because he interpreted Stephen’s frantic attempts to give the officer a hand-written note as aggression.

The rough treatment Stephen received from the officer exacerbated Stephen’s neck pain that had just been treated with surgery a few days before. Stephen feels he cannot trust the police to provide help and protection in the event of another emergency. The author also told of how she experienced what she thought was a stroke and while firemen did come and offer a ride to the hospital, they did not offer any sort of immediate medical attention that would have been needed had the author indeed been experiencing a stroke.

These stories raise a clear warning for those who have loved ones with disabilities. Families cannot completely rely on law enforcement and emergency professionals to always understand the unique limitations of people with disabilities and offer the best assistance during crisis.

Family members of people with disabilities need to make plans for emergencies so that their loved ones’ health and safety is protected as much as possible. Some specific ways to prepare for emergencies would be to:

1. Instruct family members with disabilities to contact family members right after emergency professionals,

2. Keeping relevant health records in an easily accessible location and instructing family members to give the materials to emergency professionals, and

3. Enlisting neighbors and nearby friends to offer assistance in emergency situations.

If the family member is not their own guardian, legal documents must be prepared so that non-relative friends who offer assistance will have the legal authority to do so and the family member will not be placed in foster care.

All of this is taken care of in our routing estate planning for Golowin Legal clients. Whether that includes Health Care Powers of Attorney, Living Wills, HIPAA Release forms, all instantly available to family and emergency responders alike, or whether that includes rarely used Do Not Resuscitate documents clearly visible in the home. For children, their Kids Protection Plan serves a similar purpose.

Family members are the most important people in our lives, and the one of the best ways we can show our love for them is by protecting them from potentially traumatic and even life-threatening traumatic events through careful planning.

Should Estate Planning Be Put Off During A Recession?

2009-04-03T09:15:00.000-05:00

CNBC's In The Money discussed how estate planning has fallen to the end of the list for some people in these financial times and why that's a mistake. Alexis Martin Neely answers calls about 1) How to make sure your child is taken care of and whether it is worth it, 2) Whether you should add a child to a mortgage, 3) How a trust can keep your family finances private, and 4) The importance of reviewing beneficiary designations of life insurance and retirement plans.

Securing the American Dream for the generation that follows

Write The Most Important Letter of Your Life

2009-03-31T09:00:00.001-05:00

At Golowin Legal, a very large part of our estate planning process for both young families and old is to record "Priceless Conversations" which permanently record our values, hopes and dreams, wishes and even fears for those who follow in our footsteps.

An example of the power of these priceless conversations can be seen in Mario Vittone's "Most Important Letter", which is reproduced below.

My father wrote me a letter before he died. He was 44 and knew he wasn’t going to make it to 45. Though very weak from illness and treatments that go along with having cancer, he wanted to say something of value to his children. Knowing that he wouldn’t be there for us anymore, I imagine he wanted to say the one thing he could, to each of us, that would help us for the rest of our lives. I’ve read that letter countless times since my mother gave it to me; but for the life of me, when I think about it, I can only remember one part. He said, “Right now in life, you are pretending to be a goof off. But I know that one day you will do something great that will set you among the very best.” With those words, my father gave me the one thing that all children need; what Merita Golden called, “permission from someone they love to venture into the unknown.”

“You will do something great that will set you among the very best.”

His faith-filled charge was not a parental request; he wasn’t just hoping; it was his prediction. Going through the rest of my life knowing that he believed it about me gave me permission to believe it about myself. Since the day I first read his words (at 12 years old) they have been with me; in the soulful heart of my subconscious. As I was certain that he loved me, I was also certain that my life would be extraordinary. I didn’t know what it was but that didn’t matter because he didn’t either. “You will do something great.” At times in my life when I am feeling proud of myself I remember my father and his words and wish he was here to ask, “Is this what you were talking about, Dad? Should I keep going?”

He’s not here to hear my question and though it took me a long time to understand, he wouldn’t know the answer anyway. He was not the repository of all human wisdom that my memory transformed him into in the years since his death. He was just a man, like me, trying to do his best. Still, his words stay in my head and I find myself compelled to keep going; just in case there is more; to keep reaching for the greatness he spoke of. I am sure I will take his last words to me to my grave wondering if I got there. Meeting him in heaven, I’ll get my answer.

I dreamed once of that meeting: I was twelve years old again and with a young child’s legs I ran up to him, threw my arms around him and asked, “Was I great, Daddy? Did I do it?” He kissed me on my cheek and whispered , “Jeez Mario, I was only talking about you acing a math test or two. Lighten up.” My father was very funny in life. I guess my dream couldn’t betray his heart.

A long way from twelve now, I realize that my father would have been very proud of me at all the moments in my life. He would have been proud when I graduated from basic training, and been proud when I returned home from the sea. He would have been proud that I became a Coast Guard rescue swimmer. He would have loved to have been there (though his younger brother, my Uncle John, has filled in often) when some Admiral pinned a medal on my chest. He would have been very proud being my father. I know it. But as I get closer to his age when I knew him, I can’t help but think that I’ve been missing something. Making him proud isn’t what I’m supposed to be doing. Lately - perhaps finally - I believe he would want me to move on to what is next. He would want me to be more like him. He would want me to be proud of - and believe in - someone else.

It’s time to start writing my own letters to my children and to my friends. It is time for all of us to start writing. We shouldn’t wait. As I’ve always looked to my parents I know now that our children always look to us with the same unanswered question just behind their hearts. “Is this it, Daddy? Am I doing good?” It’s the reason they learn to say “Watch me” so young. And if you only get one thing then get this: Our children do not hold back or shrink from themselves because they are afraid to fail. They are only afraid of failing us. They do not worry about being disappointed. Their fear - as mine was until that letter - is in being a disappointment.

I know it seems like a long way off, but this Mothers Day and Fathers Day I think we should do something different. I think we should write the most important letter of our lives and give it to our kids. If you don’t have any then write one to anyone who looks up to you. You know who they are. And it doesn’t matter how old they are, and it doesn’t matter if you think they already know. If they are still looking up to you they are still waiting for an answer to their unspoken question. They are waiting for you to believe in them. And I know they may already be great kids, and I know they may already know that you love them. I always knew my parents loved me (thanks Mom). But trust me; that belief will be more complete - that love will be more real - their belief in themselves will be greater if you write a letter on their hearts that says, “Don’t worry; you will do something great.” Not having it – not having that permission from someone they love – may be the only thing holding them back.

If you would like pass on your values and wishes for your children and/or loved ones like this, contact our office at (614) 453-5580. We'll show you how our clients do just that.

Beware Annuity Sharks?

2009-03-28T08:38:00.003-05:00

The March 22, 2009 edition of The Columbus Dispatch advised "Advice for Elderly Beware Annuity Sharks". This article, written by Steve Wartenberg, told the story of a blind woman with dementia who had just moved into a nursing home.

With all of these health issues going on, she was advised to cash in her current annuities and invest her life savings in another one (most likely generating surrender charges and high commissions for the financial advisor).

Two weeks after purchasing these annuities, the woman passed away, and the new annuity investment left her loved ones with half of what they would have inherited if she had not invested in the annuity.

In all fairness, I think it is critical to note that there ARE many circumstances when annuities can be a valuable piece of a family's financial plan - just almost never for ill elderly.

Quite often I must advise clients that the annuity they were sold (with the advisor knowing long-term care would be likely needed soon) must be cashed in in order to protect any of the money or to qualify for Medicaid. This often means paying a surrender charge (penalty) of thousands or even into the tens of thousands of dollars. This sometimes makes some shocked and angry clients.

Other times, I find clients that were told the annuity would protect their money from the nursing home, which is usually not correct. Would they have bought the annuity had they known the truth?

I've also seen people that bought an annuity to qualify for the Veterans Administration (VA) Aid and Attendance benefit, only to find out that when they needed nursing home care later that the annuity severely damaged their ability to leave money to children in the end.

Unfortunately, some people think seniors are good marks for financial fraud, identity theft, or financial products that really don't fit their needs.

My advice is to understand that like all financial investments, or even legal techniques you might develop with a lawyer, they must fit your individual goals and values. Otherwise, you won't get a whole lot of benefit, and it could possibly be damaging to your financial health.

As I said, annuities can be great investments, but beware of buying them when there are health concerns, advanced age, or if you are often advised to cash in one for another.

Ways To Help Your Aging Relative With Their Finances

2009-02-26T08:55:00.000-05:00

Sometimes aging loved ones need a little help managing their money. Many times they don't need everything handled for them, but a little guidance or a review is helpful.

In my prior post, Help Your Aging Relatives With Their Finances, some of the warning signs of financial meltdown were discussed, along with the need to bring up the issue early. Here are some tips on how to help without taking over completely.

Set up direct deposits for Social Security, Pensions
Set up automatic billpay for recurring expenses
Minimize the number of accounts ***Do your parents have 15 CD's at 15 different banks? Do they have 5 different brokerage accounts? In my opinion, these accounts should be consolidated with a qualified, trusted advisor in the first place...but even if not, the number can be pared down to make it easier to keep track of what's happening with the money***
Set up regular meetings to review
Arrange for duplicate bank and bill statements to be sent to you so you can track income and spending

Do NOT add your name as joint owner on your parent's bank accounts or brokerage accounts to help them manage the money. Many times, mom may name the in-town child as the joint owner because the other three children live across the country and have a more difficult time going into the bank. This causes large problems at death, when the entire value of the account passed to the joint owner in-town child, and leaves out the other children or loved ones entirely.

Instead, consider the use of a Revocable Living Trust with the in-town child named as co-trustee. That way, the in-town child can deal with the bank, but the money will pass in the intended fashion (perhaps equally to all four children). Another alternative, a little more risky, is to give the in-town child power of attorney to deal with the finances. Either one, however, is better than adding a joint owner to the account.

Help Your Aging Relatives With Their Finances

2009-02-22T08:36:00.003-05:00

Keeping an eyes on your elderly relatives may provide signs that they could use your help with handling their finances. Don't wait to get involved!

Eileen AJ Connelly of the AP writes:

[a]t first, you might notice a pile of unopened mail. Your normally fastidious mother might be getting sloppy with her checkbook. Your elderly uncle might be behind on his electricity bill. The signs are often subtle, but they might indicate that aging relatives are no longer able to handle their finances.

Once you have noticed a possible problem, now is the time to have a conversation where you offer help. Don't wait, as that will risk compounding any problems that already exist. The longer the topic goes unspoken, the greater the chance that once the problem is critical, that your offer of assistance will be met with resistance or denial. However, don't avoid the topic because you think there will be trouble...sometimes the elder may simply assume you're too busy and they don't want to bother you with their troubles.

Sometimes is is easier to enlist the assistance of one of the elder's professional resources: their lawyer, CPA, financial advisor, or doctor. Connelly writes:

Once the conversation is started, be sure to discuss a budget, income, assets and insurance policies. It also can be a good time to make sure that a will is in place, and discuss whether a health-care power of attorney is appropriate.

While I agree that this is an excellent time to discuss whether your parents have an appropriate estate plan in place (at a minimum: Will, General Durable Power of Attorney, Health Care Power of Attorney, Living Will, Organ Donor Registration, HIPAA Release), I strongly disagree that this is the time to "discuss whether a health-care power of attorney is appropriate".

A health care power of attorney is always appropriate from the moment one turns 18 years old. There is no reason to wait and risk having the court be involved in order to appoint the one in charge of making medical decisions on your behalf should you be incapacitated. All adults should have a health care power of attorney!

Should the financial problems be a result of limited, fixed income, investigate state or federal programs that might help with some of the monthly bills. Your local Area on Aging is a good place to start.

Warning Signals:

Signs to watch for if you suspect an elderly relative might be having trouble handling finances:

Unopened mail
Late or unpaid bills; collections actions
Confusion or lack of interest about what bills have been paid
Bounced checks
Disorganized personal paperwork
Uncashed checks or unclaimed property reverting to the state
A large number of magazine subscriptions
Unusual or increasing direct mail or shopping-channel purchases

Read the entire article, Aging Relatives May Need Help With Finances.

Family Financial Freedom Notebook

2009-02-17T19:06:00.001-05:00

The following article is written by America's Personal Family Lawyer, Alexis Martin Neely.

Lots of people are wondering, what do I do know that the economy appears to be melting down?

First and foremost, don’t panic. You are not going to end up standing in line for the soup kitchen. Not if you’re reading this right now.

What you are going to do is get more aware of your family finances, learn to live within your means and generally gain awareness you didn’t have before.

Then, you’re going to look back on this “financial crisis” as the best thing that ever happened to us.

One of the most important things you can do is to establish a family freedom notebook. This is a notebook that you use to keep track of everything related to the financial well-being of your family.

At a minimum, here’s what you put in it:

1. Monthly bank statements for every bank account you have, including any custodial accounts in your kids’ names (keep 12 months worth of statements in the notebook and then scan and archive older statements).

2. Monthly brokerage account statements for every brokerage account you have, including college savings accounts, like 529s (keep 12 months worth of statements in the notebook and then scan and archive older statements).

3. Monthly retirement account statements for each of your retirement accounts (keep 12 months worth of statements in the notebook and then scan and archive older statements).

4. Monthly insurance policy statements for each of your insurance policies ((keep 12 months worth of statements in the notebook and then scan and archive older statements).

5. Copies of your insurance policies (keep these forever).

6. Documents related to any other assets owned, such as the pink slip for your car or lease papers if you are leasing your car.

7. Monthly mortgage statements (keep 12 months worth of statements in the notebook and then scan and archive older statements).

8. Monthly credit card statements (keep 12 months worth of statements in the notebook and then scan and archive older statements). Also, in this section, keep a list of all of your credit card numbers, along with their security codes and the 800# on the back of the card. This list will be a lifesaver if you lose your wallet.

9. Any other loan statements or statements evidencing liabilities you may have, such as student loans, personal loans from parents or car loans.

10. Family Profit and Loss Statement: This is a monthly updated ledger of all income that comes into your family and all expenses that go out.

11. Family Balance Sheet: Updated monthly, this will list out the current values as of month’s end for each of your accounts, including liabilities.

12. Estate Planning Section: Your whole estate plan would be too big to keep in your Family Freedom notebook, but you can keep a CD or jump drive with your estate planning documents on it and any documents related to the transfer of assets into your Living Trust. Plus, keep your long-term guardian nominations and your Kids Protection Plan, medical powers of attorney for your kids, and your own health care directives and powers of attorney in this section as they will need to be accessed immediately if anything happens to you.

13. Other personal legal documents: if you own property with anyone else, have entered into any business arrangements, or have personal legal agreements, keep those in this section.

14. Pay stubs: keep a year’s worth of the part of your pay stub that shows how much you got paid, how much went to taxes and how many hours you worked. I can’t tell you how many non-breadwinner spouses have told me they don’t know how much money the breadwinner spouse makes. Bad idea. Make sure you know and have the records.

15. Social Security Statement: You know that green and white letter you get in the mail each year that says how much you’ve paid into social security and how much you can expect to get, keep it here. I can’t promise you’ll actually get this as our system may not have the money to fund it, but you can at least keep the record that shows you paid into the system.

Obviously, this notebook contains very sensitive information, so consider keeping it in a small fireproof safe in your house. Just make sure the safe is not one that can be lifted up and carried away by a thief. Make sure it’s the kind that anchors into the ground or the wall.

Please note: this is not a household notebook or a Family Emergency notebook. That’s a whole different animal and something that SHOULD be kept accessible to other family members, babysitters and household helpers.

SOURCE: Family Wealth Planning Institute

Caring For Your Parents

2009-01-28T07:19:00.002-05:00

Last April, PBS aired the program "Caring for Your Parents", which focused on the fact that many adult children are "grappling with an unprecedented social, cultural, economic, and personal revolution as they transition into the primary caregiver role for their aging parents."

This two-hour program covers "today's struggle to keep parents at home, tensions between siblings, and the complexity of shifting caregiver roles through an intimate look at five American families."

After the program, there is a half-hour discussion with medical correspondent Dr. Art Ulene entitled "A Conversation About Caring." During this session, the speakers offer concrete advice and guidance (read interviews with the doctors here)on how to start the conversation, which is quite often the most difficult step in caregiving - and one we cannot afford to avoid.

Watch the PBS program "Caring for Your Parents" online.

Access the Caregiver Handbok.

Caregiver Burnout - Adult Day Care Services to the Rescue

2009-01-07T15:38:00.004-05:00

If you are a primary caregiver for a loved one, you are well aware of the daily stress and emotional and physical impact it can have on your health.

Susan learned this first hand when she and her husband, Tom, brought his Mom home to live with them. Mom suffered from dementia and had to be watched constantly. Susan found that when you become a caregiver, you start by giving up a few things you usually do for yourself to make up for the time needed for caregiving. Even though your service is one of love and you are willing to do the sacrifice on behalf of your loved one, you find yourself giving up a lot more as time goes on.

“As a caregiver,” Susan laments, “You are often frustrated that you can’t do enough for your loved one and so guilt and feelings of inadequacy set in. Couple that with feelings of being unduly burdened, of resentment, of stress and then of more guilt at having those feelings."

She continues, "Now don’t get me wrong, I am very glad that I spent those years in caregiving. There were many cherished moments with Mom that only I experienced.”

In order to enjoy those moments and sustain your caregiving momentum, a little respite is essential.

An article posted on About.com by Carrie Hill, PhD states:

“Caregivers who use respite care often tell me that although caregiving is one of the hardest jobs they've ever had, they wouldn't trade the experience for anything. Helping a family member or close friend who has Alzheimer's disease can provide a sense of purpose and great satisfaction. Still, the emotional and physical demands of caregiving make it hard to be a caregiver 24 hours a day, 7 days a week. Without respite care -- a temporary break from the demands of caregiving -- you may be more susceptible to the effects of caregiver stress, such as depression, exhaustion and other health problems.

Carrie Hill, PhD, About.com “Why Caregivers Need Respite CareGiving Yourself a Break Helps You and Your Loved One” Updated: August 3, 2008

Be on the lookout for caregiver burnout. It can creep up on you without your noticing it. Caregiver burnout symptoms can include:

depression
anxiety, irritability, or anger
feelings of exhaustion
self-criticism
Withdrawal from usual activities
trouble with handling caregiving responsibilities
substance abuse

The need for support for caregivers at home has received national recognition. State Human Resource Departments and Area Agency on Aging Services are offering more counseling and respite services for caregivers. The ARCH National Respite Services is also an organization that is reaching out to educate and support caregivers in many states. There is, however, one service that is highly valuable but very underused:

Adult Day Care to the Rescue!

Adult Day Care respite is two-fold. It gives the caregivers much needed time to themselves and gives their loved ones social and interactive therapy with their peers.

Many adult day services offer such things as:

Social activities; music, movies, crafts, excursions
Meals
Fellowship support
Assistance with daily living
Nursing care
Help with activities of daily living
Medications
Physical therapy
Transportation

Finding an Adult Day Services provider takes a little investigating on your part. It is important to know what you are getting and that your loved one is comfortable with his or her new surroundings.

First: Ask for recommendations.

Check with your local Senior Center, Area Agency on Aging Services, Mental Health Centers, Doctor, Clinic, Family, Friends and neighbors. The best recommendation is by someone who has used the adult day services or is familiar with those who run it.

Second: Call and ask the facility to send you information.

Ask specifically to be sent the application, eligibility requirements and payment information.

Ask to see the calendar of activities, menus, hours and days of operation are needed to be sure to fit your schedule.

Ask about availability of transportation to and from the location and what is the cost.

Ask who runs the facility. Is it private, non-profit or a franchise or part of an assisted living facility or a nursing home?

Third: Visit the Adult Day Care facility.

Go visit the provider location along with the person you are caring for.

See if the staff is friendly.

Check that it is clean and odor free.

Ask about the experience of the staff.

Request a list of references.

Fourth: Find out the cost and payment requirements.

A survey from NCOA/NADSA provides the following information on fees:

“Fees for Adult Day Care providers range from $25 per day to $70 per day, with the average around $50 per day. Many facilities provide services with a sliding fee scale.”

One last word of advice. Don’t feel guilty about taking your loved one to adult day care.

Susan’s mother-in-law complained bitterly about leaving home and going to the adult day care facility, expounding on how Susan just didn’t want her around anymore. This only increased the guilt Susan was already feeling, but Susan was also determined that she needed the respite time the day care would provide and they pressed forward. That evening as Susan picked up Mom and helped her into the car, Mom -- who suffered from dementia -- exclaimed, “That was the nicest resort I have ever been to!”

Click here to learn more about the AOA National Caregiver Support Program.

The National Care Planning Council supports Caregivers and Adult Day Care Providers.

Non-Profit Leads Push for Tax Credit for Special Needs Families

2008-11-30T08:22:00.000-05:00

A Florida non-profit organization has begun a petition drive urging Congress to offer a tax credit to families of children with special needs to assist with the costs of obtaining guardianship.

Prosperity Life Planning, the organization behind the petition, teaches families of children with special needs how to locate resources for their children while preserving access to government benefits. According to a recent article in US News and World Report, the organization decided to pursue the petition because "families often can't afford to set up a guardianship, which involves court expenses and doctors' fees, so they don't do it."

Once a child turns 18, parents’ legal relationship with the child changes because suddenly it is presumed that the child has the ability to make decisions on her own, regardless of her abilities. At this point, one option is to become the child's legal guardian so that the parents can continue to make the important medical and financial decisions on child’s behalf. The proposed tax credit would give families an incentive to pursue guardianship, which many avoid because of the costs.
Prosperity Life Planning is proposing that a tax credit of up to $5,000 would be available to reimburse families for the legal fees they incur in order to obtain guardianship of their child.

The same tax credit could also be used to help families establish a supplemental needs trust for their child with special needs. These trusts are used to preserve assets for a person with special needs in order to supplement any benefits he receives from the government. According to the proposal, the tax credit should be made available to any family member of a child with special needs who pursues guardianship or intends to draft a supplemental needs trust (especially in situations where a child is being raised by family members other than her parents) and would be tracked using the child's Social Security number, so only one tax credit per child could be used.

Prosperity Life Planning points out that the government already provides numerous tax incentives for programs that benefit the public, including tax-deductible retirement accounts and education tax credits. Prosperity Life Planning argues that families of children with special needs face greater challenges than most with minimal government resources to assist them.

To read more about the tax credit proposal, and to download a statement that you can mail to Prosperity Life Planning to show your support for their initiative, go to www.prosperitylifeplanning.org.

Elder Mediation Resolves Family Conflicts

2008-11-28T09:12:00.001-05:00

“My daughter is insisting I move in with her,” complains Martha. “She just wants to control my life and take away my freedom,” she continues.

Jenny, Martha’s daughter worries that her mother keeps falling, and fears one day she will break her hip or hit her head.

“I’ll take my sister to court before I will let her get control of mom and my inheritance,” exclaims Jim about Jenny’s desire to move her mother in with her.

It is amazing how quickly formerly cordial relationships between family members will sour when the family has to deal with care of elderly parents or inheritance at their death. Sometimes the consequence of dealing with the final years of elderly parents can break families apart and create long-lasting animosity.

The National Care Planning Council has seen an increase in requests from caregiving children for help in solving disputes with siblings. In one case, the caregiver was being sued by her sister for abusing their parent and stealing the Social Security checks. In another, the caregiving child would not allow siblings to see their mother, claiming they would take advantage of her.

A lot of times it is a “she said,” “he said” situation with neither party really understanding what the elder person needs or wants.

Some families find it hard to communicate with each other when their parent is in need of care. Perhaps when they grew up together they were not accustomed to come together as parents and children to work out problems. And now those children are older and taking care of parents and they don't have this family council strategy to rely on. It may seem unnatural to them. But that is often exactly what is needed, especially in situations where perhaps one child is caring for the parents and the others are left out of the loop.

Children all have a common bond to their parents and as a result a common obligation or responsibility to each other. When disagreements arise, suspicions begin to grow. Suspicions or distrust often lead to anger and the anger often leads to severing the channels of communication between family members. This can occur between parent and child or between siblings or between all of them.

It is often at this point that a neutral third party can come in and repair the damage that has been done and help correct the problems that have come about because of the disagreement.

A practitioner experienced in elder mediation is a perfect choice for solving disagreements due to issues with the elderly.

WHAT IS ELDER MEDIATION?

Mediation is a non-adversarial approach to solving disputes. Mediation is a process of bringing two or more disputing parties together and having them mutually negotiate a solution to their disagreement. The mediator is not a judge and does not render a decision but is there to make sure that communication flows freely between the disputing parties. Elder Mediators are trained in the art of negotiating resolutions between elderly parents and family members.

Mediation can achieve results that the family by itself may not be capable of realizing or have the expertise of achieving. Here are some reasons that make Elder Mediation so valuable.

A trained expert on communication gives the family a perspective it could not gain by meeting together on its own;
All family members involved meet and prevent problems from arising by anticipating situations that may cause disputes;
Allows for the mediator to invite experts such as care managers or other care providers into the meeting to educate the family and give them a new perspective;
Allows parents to focus on their abilities rather than their limitations;llows children to come up with and consider options not thought of previously;
Encourages uninvolved family members to become involved;
Allows parents to express wishes and desires that had previously gone unuttered;
Allows for a neutral third party to challenge family members and make them take responsibility for their actions;
Promotes consensus of all involved which in turn creates a much higher rate of compliance with the plan than with any other process; (the success rate for compliance with elder mediation is estimated to be about 80% to 85%)
Requires a written plan with specific responsibilities which makes compliance feasible.

There are many organizations and companies throughout the country providing expertise in “Elder Mediation” to help seniors and their families. You will also find that mediators often have many coincident professional accreditations such as, Professional or Geriatric Care Manager, Elder Attorney, Clinical Social Worker or Certified Mediator.

In choosing a mediator, consider your needs. Is there a need for a medical assessment to determine the type of care? Are legal concerns with inheritance or family business or power of attorney, the main need? Perhaps, just bringing the family together to communicate on what needs to be done and who will do it is the agenda for now.

In one case, after months of dispute with her parents over their health and safety issues, Connie enlisted the service of a professional care manager mediator.

“Bringing a neutral person with a professional and compassionate attitude into our disputes was the best thing for all involved,” Connie recalled. “My parents shared their concerns and listened with acceptance to mine. All of a sudden we could communicate and work out a plan that they could live with and I could relax knowing they were safe.”

Seniors Use Mediators to help the family plan for long term care.

In the National Care Planning Council's book, “The 4 Steps of Long Term Care Planning,” the process of creating your own “Care Plan” before you need it is introduced. Quoting from the book:

“If the current or future caregiver wants the other persons attending the meeting to give support with respite care, transportation to doctors, etc., everyone needs to be aware of this and in total agreement to do it. All must also be willing to work with the member of the family, friend or professional who is designated as the Personal Care Coordinator.

If you feel the communication will be strained, consider having a professional mediator present. The mediator will be able to keep things calm and running smoothly
and help work out each person's concerns.”

“The 4 Steps of Long Term Care Planning” book can be found at http://www.longtermcarelink.net/a16four_steps_book.htm

Where to Find an Elder Mediator

• In your local phone book, on the internet or with your community senior services.
• References from friends and neighbors
• Contact the local area agency on aging
• Contact your state bar association
• Contact a local university or college and asked to speak to the department that provides mediation training and ask for a referral.
• On the internet look up mediation in your area
• Yellow pages in local phone books

The National Care Planning Council lists Professional Mediators throughout the United States on its website at http://www.longtermcarelink.net/a7mediation.htm

Holiday Blues - Depression In The Elderly

2008-11-24T11:13:00.000-05:00

The holiday season is quickly coming upon us. If you are a caregiver for an elderly loved one, you may notice a change in your loved one's mood as the holidays approach. Perhaps you are one of many, who visit elderly parents and family during the holidays who live a distance away. When you visit you may notice that loved ones are not as physically active, or they show symptoms of fatigue or sadness and have no interest in the holiday or in their surroundings.

According to the National Institutes of Health; of the 35 million Americans age 65 or older, about 2 million suffer from full-blown depression. Another 5 million suffer from less severe forms of the illness. This represents about 20% of the senior population -- a significant proportion.

Depression in the elderly is difficult to diagnose and is frequently untreated. The symptoms may be confused with a medical illness, dementia, or malnutrition due to a poor diet. Many older people will not accept the idea that they have depression and refuse to seek treatment.

What causes depression in the elderly?
It is not the actual holiday that causes depression, but the fact that holidays tend to bring memories of earlier, perhaps happier times. Additional contributing factors that bring on depression may be the loss of a spouse or close friend, or a move from a home to assisted living, or a change with an older person's routine.

Depression may also be a sign of a medical problem. Chronic pain or complications of an illness or memory loss can also cause depression. In addition, diet can also be a factor when proper nutrition and vitamins are lacking.

As an example, Selma’s husband passed away, a few months before Christmas. Her family lived close by and would call or drop in often to check on her. Selma seemed a little preoccupied and tired, but this was to be expected as she had been the caregiver for her husband for many years. It wasn’t until the family noticed that her holiday decorations were not out and her yearly routine of Christmas card writing was not happening that they began questioning her mental and physical well being.

A trip to her physician confirmed depression, caused by not only the loss of her spouse, but a vitamin B12 deficiency. There were both mental and physical reasons for her depression.

Symptoms to look for in depression might include:

Depressed or irritable mood
Feelings of worthlessness or sadness
Expressions of helplessness
Anxiety
Loss of interest in daily activities
Loss of appetite
Weight loss
Lack of attending to personal care and hygiene
Fatigue
Difficulty concentrating
Irresponsible behavior
Obsessive thoughts about death
Talk about suicide

How do you know if it is depression or dementia?
Depression and dementia share similar symptoms. A recent article on Helpguide.org gives some specific differences:

In depression there is a rapid mental decline, but memory of time, date and awareness of the environment remains. Motor skills are slow, but normal in depression. Concern with concentrating and worry about impaired memory may occur.

On the other hand, dementia symptoms reveal a slow mental decline with confusion and loss of recognizing familiar locations. Writing, speaking and motor skills are impaired and memory loss is not acknowledged as a being problem by the person suffering dementia.

Whether it is depression or dementia, prompt treatment is recommended. A physical exam will help determine if there is a medical cause for depression. A geriatric medical practitioner is skilled in diagnosing depression and illnesses in the elderly. If you are a care taker of an elderly person it may be beneficial for you to seek out a geriatric health care specialist. Click this link for more information on senior health services.

Treating depression in older people.
Once the cause of depression is identified, a treatment program can be implemented. Treatment may be as simple as relieving loneliness through visitations, outings and involvement in family activities. In more severe cases antidepressant drugs have been known to improve the quality of life in depressed elderly people. Cognitive therapy sessions with a counselor may also be effective.

As a care giver or family member of a depressed older person, make it your responsibility to get involved. The elder person generally denies any problems or may fear being mentally ill. You can make the difference in and remove the Holiday Blues from seniors suffering from depression.

The Geriatric Mental Health Foundation offers a “Depression Tool Kit.”

To find a Senior Health Care Services in your area on the National Care Planning Council website go to http://www.longtermcarelink.net/a7seniorshealthservices.htm

The National Care Planning Council supports the work of geriatric practitioners and their services to the growing senior population. If you are a geriatric practitioner and would like to list your services with the NCPC please call 800-989-8137.

Can I Create a Trust Inside My Will?

2008-11-21T07:01:00.000-05:00

All trusts aren't alike. When you put a trust in your will, it should be drafted precisely in order to satisfy your wishes and goals. Just any old boilerplate text or preprinted legal form won't do.

You may have one or more reasons to put a trust in your will (called a testamentary trust by lawyers). It can benefit your family, protect your money and save taxes. When the initial beneficiary dies (your spouse, perhaps), your trust can make certain other heirs chosen by you (say, children or grandchildren) will share the principal. Or you may want your favorite charitable organization to benefit. Quite likely you have other goals you want your trust to achieve.

You can set up a trust for just about any purpose. It's a remarkably versatile and flexible means to carry out your intent and assure the prudent management and eventual distribution of your assets. Let's look at some possibilities and benefits.

Types of Trusts
Testamentary trusts are often given various kinds of descriptive labels to identify their nature and purpose. Still, a trust can have multiple objectives.

Marital trust. You can leave some of your estate to a marital trust for your surviving spouse's benefit. The trust assets will be free of federal estate tax in your estate because of a marital deduction, but they will be subject to estate tax when your spouse dies later. You can give your spouse the right to appoint the trust remainder to anyone. Or, if you prefer, you can use a "QTIP trust" so you can name the remainder beneficiaries.
Family trust. Also called a bypass or credit-shelter trust, this provides lifetime financial support for your spouse. The trust assets can bypass the federal estate tax twice: first, at your death, when it qualifies for the unified estate and gift tax credit; second, on your spouse's death, when the remaining principal passes directly to your children or other beneficiaries you name. Many couples include both a marital trust and a family trust in their estate plans.
Other trust types. An irrevocable life insurance trust is funded by the proceeds of life insurance on your life. A trust that benefits your family first and then distributes the principal to your favorite philanthropy is called a charitable remainder trust. Trust types go on and on.

Typical and Special Trust Provisions
Trusts usually last a long time. Just as you wisely choose the right kind of trust, you should include essential terms to assure flexibility and anticipate unpredictable circumstances.

Plan Carefully
Don't take chances—make sure your trust plans fulfill your beneficiaries' needs, allow prudent investment management and shelter the assets from unnecessary taxes. See an attorney who specializes in drafting wills and trusts. Equally important, name an experienced corporate trustee.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Spice Up Your Estate Plan By Using Trusts

2008-11-15T06:59:00.000-05:00

Are you looking for new ways to protect your family and your money? Would you like to cut estate taxes and probate costs, too?

Trusts can be the answer. They are remarkably versatile and can broaden your estate plan. While not magical, they can produce results that seem beyond belief.

The particulars are simple. A trustee chosen by you manages the trust assets, called the principal, and pays an income to those you want to support, your beneficiaries. Your will or a separate legal document is needed to establish a trust. When you create a trust, you are referred to as the grantor or donor.

Why Would You Use Trusts Today?
A trust can be either revocable or irrevocable. A revocable living trust agreement allows you to amend or cancel the trust at any time, in case you change your mind. On the other hand, if you put a trust arrangement in your will, it will become irrevocable upon your death.

You can set up a trust for anyone for just about any purpose. Here are some typical trust arrangements.

Family trust. You can create a trust in your will—known as a testamentary trust—for the benefit of your spouse, children and other family members. In a typical family trust, a husband and wife set up a trust in their wills for the surviving spouse's benefit. Each directs that after his or her death, the trust shall continue for the support of their children until the children attain a certain age, say 25 or 30. Then the trustee is to turn over the principal to the children.
"QTIP trust." The acronym stands for qualified terminable interest property. Although the surviving spouse receives lifetime income from this trust, he or she may not have the power (other than certain limited rights) to determine the beneficiary of the remaining trust assets upon the survivor's death.

The intent is generally to allow more control in a second marriage situation where the goals are to provide maximum financial support for the surviving spouse, but still ultimately pass the trust principal to children of the prior marriage.
Living trust. You might decide to create a trust for your own benefit, a trust that will remain operative while you are living. It logically is called a living, or inter vivos (Latin for "between living persons"), trust. In this case, you direct the trustee (which can be yourself or a professional trustee of your choice) to look after the trust assets, pay you the income and counsel you about the investments. You are to be kept fully informed about all transactions. You can reserve the right to amend or revoke the trust, to add or withdraw assets, and to approve investment changes. The trust can continue after your lifetime for the benefit of your family or others, and the trust assets avoid the costs and delays of probate.

A Versatile Tool
If you'd like to make a gift to our organization or another charitable organization, but you first must satisfy your own family's financial needs during your lifetime and after, a trust can be the ideal solution.

Trusts let you have it both ways—pass assets to your heirs with the least amount of tax and make a gift to us. Often trust arrangements will accomplish much more, including professional investment management and the assurance that your wishes will be fulfilled.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Should I Create a Joint Trust? (Should We Have One Trust or Two?)

2008-11-11T06:56:00.000-05:00

If you're married, perhaps you and your spouse are thinking about setting up living trusts. If so, you might ask, "Can't we have just one living trust for the two of us?" Is a joint trust a good idea?

How a Joint Trust Works
First, don't confuse a joint living trust with jointly owned property. A joint trust is created by a single document that manifests your and your spouse's respective wishes about the disposition of your respective property placed in the trust. As to joint ownership, there are various forms, but the most familiar is joint tenancy with rights of survivorship, by which the share of the deceased joint owner passes automatically and outright to the surviving joint owner.

With a joint trust, community property and separate property of both spouses may be transferred into the trust and retain their character as community or separate property. Both spouses benefit from the trust during their joint lifetime. When one spouse dies, the entire trust continues for the benefit of the surviving spouse.

Estate Tax Advantages
A joint trust is most commonly used in community property states, where most of the property in the trust is characterized as community property.¹ In some cases, there can be significant estate tax advantages to this type of arrangement.

Typically, the terms of such a joint trust are somewhat like this: When the first of the couple dies, the trust splits into Trusts A and B. The assets allocated to Trust A qualify for the federal estate tax marital deduction and include the survivor's share of the community property and the survivor's separate property, if any.

Example: Fred and his wife, Jean, have $5 million of community property in a joint trust. When Fred dies, normally one-half, or $2.5 million, would be allocated to Trust B, intended eventually to bypass Jean's taxable estate. However, this would generate estate tax in Fred's estate on the excess over a tax-free allowance $2 million in 2008. So, assuming Fred made no prior gifts, the excess of $500,000 will be allocated to Trust A. Result: Trust A will wind up with $3 million and Trust B with $2 million, both fully exempt from federal estate tax in Fred's estate.

However, the potential estate tax advantages must be weighed against many other factors and issues created by joint trusts.

Which Is Better?
Needless to say, arriving at a decision between a joint trust versus separate trusts is relatively complex. If you reside in a community property state, you and your advisor may wish to seriously consider a joint living trust. (One cautionary note: You may live in a community property law state, but perhaps the majority of the property you plan to place in the trust is characterized as separate property. In this case, separate trusts should be considered.)

If you reside in a noncommunity property state [Ohio is a SEPARATE PROPERTY State], each spouse's wishes and property usually are dealt with more efficiently by separate trust agreements. Ultimately, the right answer depends on your state laws and your personal circumstances. Whichever course you choose, it is imperative that your selected executor and trustee are experienced in dealing with separate and community property, and that they take all the necessary steps to maintain the original character of the property.

Your living trust will have legal and tax consequences. Equally as important, the structure of that document will have an impact on you and your beneficiaries in many other ways. Seek the counsel of an attorney who specializes in estate planning. And, of course, our organization's trust and estate planning professionals are available to assist you in exploring your options in developing this very important financial planning document.

¹ Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Discover the Flexibility of Living Trusts

2008-11-08T06:45:00.000-05:00

A living trust is just what its name implies—a trust you establish while you're living. Living trusts can be "revocable" or "irrevocable," and there are unique characteristics to each. Although it's not normally intended to completely replace a will, a revocable living trust can be an effective way to maintain control of property during your lifetime—and a private way to dispose of it after your death.

Revocable Living Trusts
The benefits of establishing a revocable living trust—one that allows you to change the terms at any time—are many. Here are some of the most important advantages.

Professional management. You may not have the ability or the time now to act as your own trustee and manage your assets the way you want. A professional trustee will do that for you. You can then observe how your trustee manages your money and continually make clear to him or her exactly what you want done with your money during and after your life.
Probate avoidance. At your death, the revocable trust will become irrevocable. Then the assets in your living trust will bypass the expense and delay of probate. Transfers will not be public, so your privacy will be preserved.
Asset protection. A trust will protect beneficiaries from others (protecting children's inheritances, for example, from divorced spouses).
Control of terms. You may select the location of your revocable trust, thus choosing the law that will govern its operation and the interpretation of your trust instrument. By choosing the law of one state over another, it may be possible to do things that you cannot do under the laws where you are domiciled.

The Irrevocable Charitable Trust
If you are interested in making a major charitable gift but feel you can't give up the income from your assets, consider an irrevocable charitable remainder trust. Eventually [the charity] will receive what's left of the trust after your lifetime (and that of another beneficiary, if you wish), but in the meantime you'll benefit in these ways.

Tax savings. If you transfer long-term appreciated assets to a charitable trust, you'll receive an income tax deduction based on your age and the fair market value of the assets on the day you set up the trust. Plus, the transfer is not subject to up-front capital gains tax.
Lifetime income. Every year, the charitable trust pays you (or your beneficiary) either a fixed income (with the annuity trust) or variable income (with the unitrust) You make the choice when you set up your trust.

See how a charitable remainder annuity trust can benefit you.

See how a charitable remainder unitrust can benefit you.

SOURCE: University of Georgia in an article written by Mary L. McCormack

A Living Trust? You Don't Need to Be Rich

2008-11-03T06:43:00.000-05:00

The term "trust fund" conjures up images of mansions, yachts and huge fortunes. But once the province of the very rich, trusts have found themselves into the lives of many families who've never thought of themselves as wealthy.

Trusts come in myriad forms, but for middle-class families, the living trust is popular because the person creating the trust can enjoy lifetime benefits. You can deposit assets in your own trust and ask the trustee to manage them prudently and pay the income to you, so you have more time for hobbies, travel and family.

Later, there are other important advantages. The property in a living trust that survives you can avoid the costs, publicity and delays of probate and speed property distribution to your spouse or other beneficiaries. If you choose, the trust can continue for their benefit in order to provide sound investment management and reliable financial support.

What Is a Living Trust, Anyway?
Unlike a trust you might establish by will, a living trust is set up by a written agreement between you and the trustee, and it takes effect immediately.

While you can be your own trustee, you may prefer to name a professional trustee to manage the trust assets, keep good records, pay you a regular income and—should you become incapacitated—pay your household and medical bills.

A living trust can be revocable or irrevocable. The advantage of a revocable trust is that you don't give up control—you can amend its terms or even cancel it whenever you wish. On the other hand, you may want to put some of your assets in an irrevocable trust so you can achieve other significant goals.

For example, you could set up a charitable remainder trust to pay yourself a dependable income for your lifetime and then distribute the remaining principal to our organization. The substantial, current income tax savings as well as future estate tax savings of this kind of trust magnify its appeal.

Your Estate Plan, Too

A revocable living trust can be an important part of your estate plan. It's an ideal vehicle for holding title to real estate outside your home state. You can make your life insurance payable to your trust. And the trust can include a credit shelter trust provision to help minimize estate taxes and other provisions to make gifts to family and charitable beneficiaries.

Along with your attorney, we can show you how a living trust can blend your personal needs, estate plans and philanthropic intentions.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Five Benefits of a Living Trust

2008-11-01T06:41:00.001-05:00

Living trusts are flexible estate planning tools that can offer you many advantages, five of which are mentioned below:

1. Revocable. Because the needs of family members may change over time, a living trust normally allows you to modify trust provisions or change the beneficiaries.

2. Private. A living trust avoids the costs and delays of probate—the state-sanctioned system that oversees the administration of your estate. Because a living trust is not subject to public scrutiny, your beneficiaries and the specific amounts or percentages they receive remain confidential.

3. Continuous. Assets put in a living trust stay under the control of the trustee, until you choose differently. When the trust is established, you can name a successor trustee who will carry on financial responsibilities in the event of your incapacity or death.

4. Flexible. You may add other assets to the trust during your life. The living trust can be especially useful if you own real estate in another state by eliminating the need to have a separate probate proceeding in the other state.

5. Professionally managed. Though not exclusive to living trusts, banks are generally well prepared to act as trustee. Also, some attorneys are willing to take on the task. Through prudent investing, these individuals can help make the most of your trust's assets and ultimately deliver more money to your beneficiaries.

A living trust is a remarkable financial and estate planning tool. To secure the plan best suited to your individual needs, be sure to consult an attorney who is knowledgeable about the features and benefits of living trusts.

SOURCE: University of Georgia in an article written by Mary L. McCormack

Getting Started: The Revocable Living Trust

2008-10-29T06:36:00.002-05:00

The University of Georgia's Mary L. McCormack wrote the following article entitled "Getting Started: The Revocable Living Trust:

The subject of a living trust as an estate planning tool generates quite a bit of discussion. A living trust is an arrangement you create during your lifetime to provide for yourself and your family both before and after your death. It has built-in flexibility that can work very well with your overall estate plans. Though there are many advantages to using this estate planning tool, it is not a substitute for a will.

Looking at Both Sides

Reduction of probate costs. Although you can enjoy the use of the assets you place in a trust during your lifetime, a living trust removes those assets from your estate for probate purposes. Therefore, you save the probate and administration costs you would incur if those same assets were distributed by the terms of your will.
Speedy distribution of trust assets. By establishing a living trust during your lifetime, you are setting up a method of managing and distributing your assets. Because a living trust escapes the probate process, the plan of distribution you describe is set in motion immediately at your death. There are none of the delays that occur under distribution by will, and you can be sure your assets ultimately will benefit the charitable institution(s) that mean so much to you.
Flexibility of planning. Most living trusts are revocable. This gives you the freedom to amend, add to or even completely revoke the trust agreement as you wish.
Freedom of control. Living trusts give you the freedom to name both the beneficiaries and the trustee. Most likely you will name yourself as the trustee during your lifetime and maintain the right to appoint and select successor trustees and beneficiaries. You also control the income and principal and how much of it you wish to use during your lifetime.
Investment management. You may choose to appoint a professional trustee such as a bank trust department or trust institution. This frees you from the worry of the day-to-day management of assets, yet if you remain as co-trustee, you still may direct investment goals, including instructing your trustee to change investment strategies.

If you wish, you can give your trustee broad powers and allow the trustee to make the decisions, do all the paperwork and collect the dividends and interest and credit them properly. You would receive periodic and detailed accounting statements, including year-end data for tax purposes. Should you suffer a prolonged illness, your trustee could even pay your medical and household bills.

Confidential trust terms. A living trust is private. Unlike a will, no one, other than the beneficiaries, needs to know the contents of a trust.
Charitable contributions. Once your needs and those of your family are met, trust assets can be distributed to charitable organizations like UGA.
Tax savings. Although all the assets in a living trust are subject to estate taxes, a living trust may be drafted to make the most of estate tax advantages afforded under federal law. After your lifetime, the value of the assets distributed immediately to a charitable institution completely avoids estate tax.

Some Final Thoughts

Keep in mind that there's no income tax charitable deduction when you create a revocable trust, and the level of income is not guaranteed. The trust's assets can be invested in highly rated securities, of course, but the yield is dependent upon economic and market conditions. From your standpoint, these drawbacks may be more than offset by your right to retain control of the trust terms and investments.

A living trust generally is not a stand-alone document. It is advisable to have a pour-over will since it is difficult to get every asset into a trust.

A living trust gives you flexibility while you receive income from your assets during your lifetime, and it can provide asset management after your death.

2009 Annual Gift Exclusion Increases to $13,000

2008-10-24T08:01:00.000-05:00

Just a quick note here - The IRS has provided in Rev Proc 8-66 that the Annual Gift Exclusion amount for 2009 has been increased to $13,000.

This means that individuals may give $13,000 in gifts each year to other persons without having to file a gift tax return. Should you be married, you can "split" these gifts and essentially give another person $26,000 in one year...but you need to file a gift tax return in that case to advise the IRS of what you've done.

When Your Aging Parents Need You

2008-10-23T06:55:00.001-05:00

Caregiving can bring guilt and anxiety—and it can be a gift as well.

By Sally Wadyka for MSN Health & Fitness

For most children, their parents are the people in charge of taking care of them from infancy and even into adulthood. Mom and Dad were there to bandage your boo-boos, sing you to sleep, and soothe you when you were sick. But as the population ages—and more are afflicted with age-related diseases such as Alzheimer's, stroke and cancer—the tables are often turned on parents and their now-adult children.

According to statistics from the National Institute on Aging, there were 37 million people age 65 or older in 2006; that's about 12 percent of the population. But by 2030, as the Baby Boomer generation ages, that number is predicted to rise dramatically. Projections forecast that approximately 71.5 million people—about 20 percent of the population—will be 65 or older. Alzheimer's disease currently affects 5 million Americans, and strokes, which also afflict about 5 million people, are the number-one cause of adult disability.

Finding answers to tricky questions

For most adult children who are thrust into a caregiving role for a parent, the change happens suddenly. "It usually starts with a phone call, and it's like getting hit over the head," says Andy Cohen, CEO of caring.com, a Web site that offers support and advice to caregivers.

Read the remainder of this excellent article by clicking here.

Financially Preparing for Special-Needs Kids

2008-10-20T06:45:00.001-05:00

Sarah Palin's son Trig helps spark a national conversation

By Kimberly Palmer

Posted September 30, 2008

Sarah Palin's 5-month-old son, Trig, who has Down syndrome, has sparked a national conversation about kids with special needs: the extra care they require, available government benefits and the pros and cons of prenatal testing.

One topic that has gotten less attention is the financial stress that parents often face. Many kids with special needs require financial support throughout their lives, and while government assistance often covers basic medical care, holding assets over $2,000 can make them ineligible. That means advance financial planning, through wills, estate planning, and trusts, can be essential to ensuring kids with special needs have the support they require once they grow up.

"If [parents] fail to deal with these issues now, it will jeopardize their child's quality of life down the road," says Tanya Harvey, an attorney who focuses on special-needs planning in the Washington, D.C., law office of Bryan Cave.

Here are tips from leading experts in the field of financial planning for kids with special needs on how to get started:

1) Establish legal guardianship. After a child reaches the age of 18, he is considered an adult. But some kids may still need a guardian, says Harvey. One of her tests includes asking whether a child would impulsively buy a pretty diamond in a store window. If the child shouldn't be held responsible for such a purchase, then he needs to have a legal guardian, or else the contract would be binding.

Karen Greenberg, director of Prosperity Life Planning, a nonprofit that teaches financial planning to families of children with special needs, along with her husband and associate director, Jaret Vogel, are urging Congress to adopt a special-needs tax credit that would help parents pay for the cost of establishing such a guardianship. Their proposal would provide up to $5,000 in tax credits to offset the cost of legal fees.

Families often can't afford to set up a guardianship, which involves court expenses and doctors' fees, so they don't do it, say Greenberg and Vogel.

2) Describe your child in writing. Greenberg recommends writing down a "minibiography" of children that could be given to any future guardians or caretakers. It should include medical information like allergies but also personal preferences, goals, and details about friends.

3) Protect your child's eligibility for public benefits. Medical care can be so expensive that even relatively wealthy families may need to rely on Medicaid and Social Security income. Because having more than $2,000 in assets threatens that eligibility, "you want to make sure that if your child is going to receive any money, that it's in a special-needs trust so it doesn't disqualify them," says Harvey. A lawyer or financial professional can help establish a special-needs trust, which doesn't count against the $2,000 limit. Money left to the child through a will should be directed into this trust.

Parents often choose to set up a trust that goes into effect when they die, says Harvey, to allow them flexibility to spend that money in different ways in the meantime. But families may be better off setting up the trust immediately if a grandparent wants to leave money to the child, for example.

Greenberg adds that another benefit to establishing a trust is that the money is then considered separate from the parents' assets, which protects it from creditors and divorce settlements.

4) Consider insurance policies. Life insurance that pays out upon the death of the second parent—often called "last to die" policies—can help parents ensure their child has enough money after they both die without straining their budgets too much beforehand.

When Greenberg, who has an autistic son, examined her budget several years ago, she decided to purchase such a policy. It pays out $650,000 on the death of Greenberg or her former husband, whichever comes second, for about $2,000 a year. In addition, for years, she tucked away about $400 a month into a special-needs trust, which now holds around $55,000. That means that if both she and her former husband were to die, their son would have the $650,000 life insurance payout and the $55,000 trust. Together, she calculates, that will generate an income of around $35,000 a year—enough to pay the bulk of his expenses.

5) Avoid common family-related mistakes. "A lot of parents say, 'How about if I give money to a relative?'" says Harvey. But doing so is a mistake, she says, because not only is the relative not legally bound to spend that money on your child but a creditor or divorce settlement could take it.

Greenberg recalls looking into her options for her son in the 1980s, when the common wisdom held that parents should leave money to their other children, who would then be expected to care for their sibling with special needs. But Greenberg doesn't like the idea of burdening siblings, who have often already experienced so much stress.

Family members and friends planning to leave money to a child with special needs should also be encouraged to do so through a special-needs trust instead of leaving money directly to the child, which could interfere with benefits eligibility. Grandparents may even want to have their wills looked over by an attorney to make sure any gifts don't threaten that eligibility.

SOURCE: US News & World Report

Medicare Enrollment Period Starts November 15, 2008

2008-10-19T13:39:00.000-05:00

It’s that time, once again, to make changes to Medicare options. According to CMS, which is the government entity that oversees Medicare, the six weeks from November 15, 2008 through December 31, 2008 is a hectic time of the year otherwise known as the Annual Election Period (AEP.) Once a year, Medicare allows enrollees to opt in or out of Medicare Part D and Medicare Part C -- otherwise know as Medicare Advantage Plans. Before we get into what that means, some background is in order.

Medicare consists of four parts -- Part A, Part B, Part C and part D. The majority of Medicare enrollees have Part A and Part B. In addition they may have an employer-sponsored supplement or a Medigap policy to go along with Part A and Part B. The fourth part of Medicare is Part D or prescription drug coverage. Most people think that the "D" in Part D is because of the word "drugs." Actually it’s because there is a Part C. Part C is the Medicare Advantage program. It was started in 2003 as part of the Medicare Modernization Act -- the same Act that created the Medicare Part D prescription drug coverage. Medicare Advantage Plans have been around for some time. Before 2003 they were known as Medicare + Choice Plans. With Medicare Advantage, Medicare pays a private insurance company to take over and administer someone’s Medicare benefits. That person is still a part of the Medicare system. He or she doesn't leave the system. A person is simply now receiving his or her benefits from a Private company not the Government.

Back to the massive stack of mail from Medicare that is coming and will be coming over the next few months. Hopefully your people are sitting down. This gets confusing. From November 15, 2008 through December 31, 2008, those eligible for Medicare have the option to change existing Medicare Advantage Plans and/or Medicare Part D. This period is called the Annual Election Period or AEP.

There is also another period of time from January 1, 2009 through March 31, 2009 that is called the Open Enrollment Period or OEP. During OEP, a person can enroll in Advantage but cannot change Part D status, meaning if there is just a Part D, a change or cancellation to the drug Plan cannot occur at this time. If there is a Medicare Advantage Plan which includes Prescription Drug Coverage (MAPD), a change can be made by purchasing another MAPD. Or, if there is just prescription coverage, an MAPD can be purchased. Going the other direction from an MAPD to prescription coverage only, is not allowed.

On April 1, 2009 and thereafter, Medicare institutes a lock-in period. During this time, no changes to drug coverage or an MAPD are allowed. As with most government programs there are a few exceptions to the rule. If a person has moved out of the area the plan operates in, or if a person becomes a resident in any long term care facility, or if a person involuntarily loses coverage, that person can enroll for new coverage under a Special Election Period or SEP. Finally, most people who are eligible for or who are on Medicaid can change coverage whenever they choose.

So why the big deal? Why does someone need to be aware each year of what is going on? The reason is the insurance companies that sponsor the Medicare Advantage and the Part D Plans have the option to change what they offer each year. Changes may come as a result of directives from Medicare, from previous years' claims experience, or from a multitude of other issues. Asking 10 people if there are pending changes to the plans they are in will result in 9 of them replying they have received notice of adjustments or premium changes. However, not all changes are for the worse. There are some instances where the plans have gotten better. Nevertheless, from year to year most plans will have changes. Sometimes a plan may pull out of an area thus forcing an individual to make an unwanted change.

Medicare allows the Advantage companies to start marketing their plans to the public on October 1 and the companies can release information on intended changes to existing plans. For any pending changes, a beneficiary should receive an Annual Notice of Change (ANOC.) Most people will receive this document in November. People need to take the time to review changes. They need to be aware of the plan they are in and the benefits it provides when they might need to use the coverage.

Medicare Advantage Plans can be a great fit for many Medicare enrollees. As with anything, one size does not fit all. During the six-week period when changes can be made, people owe it to themselves to evaluate their options. In the past, many Advantage Plan companies made a big push during this change period to move people out of existing plans and into new ones. Medicare has changed the rules on how companies can induce people to change. In the past, seniors were invited to attend presentations where they received free meals as an inducement to attend. Starting in 2009, only snacks can be provided. Preliminary indications are that pie and coffee are on the menu. Personally we like Pecan pie and free pie is good pie.

On the National Care Planning Council website, at www.longtermcarelink.net, is a link to all medicare approved advantage plans in every state. All the plans listed in an area can be found there. Finally, those people who need help or who are facing changes should contact a trusted insurance agent. Medicare Advantage plans are only available from someone who is licensed to sell health insurance.

Family Wealth Planning Institute Personal Family Lawyers & Story of My Life Team Up To Preserve 'Priceless Conservations'

2008-10-17T06:38:00.001-05:00

The Family Wealth Planning Institute™ and Story of My Life® announce a partnership program to capture and preserve "Priceless Conversations™" that clients create when they create their estate plan with a Personal Family Lawyer® law firm. The Story of My Life website deposits these precious memories into its perpetual, secure Vault to store them for their loved ones and ensure they are never lost.

Long Beach, CA (PRWEB) October 5, 2008 -- The Family Wealth Planning Institute™ and Story of My Life® announce a partnership program to capture and preserve "Priceless Conversations™" that clients create when they create their estate plan with a Personal Family Lawyer® law firm. The Story of My Life website deposits these precious memories into its perpetual, secure Vault to store them for their loved ones and ensure they are never lost.

The mission of the Family Wealth Planning Institute is to help parents make smart legal and financial decisions during life and leave the world a better place when they are gone. One way it achieves its mission is to train Personal Family Lawyers throughout the nation on how to help their clients pass on more than just their money. After the final "I"s are dotted and "t"s crossed in the Wills and Trusts, the tape recorder is then turned on and the Personal Family Lawyer captures, documents and preserves her client's most valuable wealth … the intellectual, spiritual and human assets that are most often lost when someone dies.

"Guiding our clients to pass on more than just their money is what makes being a lawyer truly meaningful," says Alexis Martin Neely, America's Personal Family Lawyer, founder of the Family Wealth Planning Institute and author of Wear Clean Underwear! A Fast, Fun, Friendly - and Essential - Guide to Legal Planning for Busy Parents. "For our VIP membership clients, we have a new Priceless Conversation each year allowing our clients to build and leave behind a true Legacy Library™ for their loved ones."

The annual audio recordings are uploaded to the Story of My Life site, and permanent data storage space is purchased from the Story of My Life Foundation, a 501(c)(3) not-for-profit, which preserves Stories and files for users in perpetuity.

"Story of My Life is thrilled to be the repository of these special recordings," says CEO and co-founder Patrick Tardif. "Our intention is to capture stories in whatever digital format - whether text, important documents, audio and video - and ensure the technology stays up to date so the files are accessible in the future. These Priceless Conversations are indeed just that - priceless, and deserve the utmost care in storing and preserving them for private access by future generations."

To locate your neighborhood Personal Family Lawyer®, in Ohio, contact Golowin Legal. In other states, visit www.PersonalFamilyLawyer.com or call 866-999-3974.

New FDIC Rules for Inter Vivos Trust Accounts

2008-10-14T06:42:00.005-05:00

On September 26, 2008, the FDIC issued interim final regulations entitled Deposit Insurance Regulations; Living Trust Accounts. The interim rules amend 12 CFR 330 and took effective immediately, pending a sixty day comment period before finalization.

Here is a summary of the new regulations:

The FDIC is adopting an interim rule to simplify and modernize its deposit insurance rules for revocable trust accounts. The FDIC's main goal in implementing these revisions is to make the rules easier to understand and apply, without decreasing coverage currently available for revocable trust account owners. The FDIC believes that the interim rule will result in faster deposit insurance determinations after depository institution closings and will help improve public confidence in the banking system. The interim rule eliminates the concept of qualifying beneficiaries. Also, for account owners with revocable trust accounts totaling no more than $500,000, coverage will be determined without regard to the beneficial interest of each
beneficiary in the trust.

Under the new rules, a trust account owner with up to five different beneficiaries named in all his or her revocable trust accounts at one FDIC-insured institution will be insured up to $100,000 per beneficiary. Revocable trust account owners with more than $500,000 and more than five different beneficiaries named in the trust(s) will be insured for the greater of either: $500,000 or the aggregate amount of all the beneficiaries' interests in the trust(s), limited to $100,000 per beneficiary.

SOURCE: Wills, Trusts & Estates Prof Blog

Make sure your money is 100% protected! FOR MORE DETAILED INFORMATION get a free special report on "If Your Bank Fails, Will You Get Your Money Back? What You Need to Know About FDIC Coverage." Click Here.

____________________________________________________________________________

***Note: After this post was originally created, the following rules came out:

Deposit Insurance Coverage
Changes to FDIC Deposit Insurance Rules for Revocable Trust Accounts

FIL-99-2008
Revised as of October 8, 2008

Summary:

The FDIC has adopted an interim regulation simplifying the rules for insuring revocable trust accounts - commonly known as payable-on-death accounts and living trust accounts. The new rules are easier to understand and apply, and provide at least as much coverage as the former rules for revocable trust accounts. The revised rules take effect today and apply to all existing and future revocable trust accounts at FDIC-insured institutions. The FDIC welcomes comments on the interim rule for 60 days after its publication in the Federal Register.

Highlights:
Under the interim rule:

The concept of "qualifying" beneficiaries based on certain family relationships has been eliminated.
For each account owner with combined revocable trust deposit balances of $1.25 million or less at a single bank, the maximum coverage will be determined by multiplying the number of different beneficiaries by $250,000. (This will apply to the vast majority of revocable trust accounts.)
For each account owner with combined revocable trust deposit balances of more than $1.25 million and more than five named beneficiaries, coverage is the greater of $1.25 million or, as before, the aggregate of all beneficiaries' proportional interests in the trust deposits, limited to $250,000 per beneficiary.
In determining coverage for living trust accounts, a life estate interest is valued at $250,000.
Irrevocable trusts that spring from a revocable trust upon the death of the revocable trust owner will continue to be insured under the revocable trust rules.

Continuation of FIL-99-2008

Distribution:
All FDIC-Insured Institutions

Suggested Routing:
Chief Executive Office
Head of Deposit & Branch Operations
Compliance Officer
Training Officer

Related Topics:
FDIC Deposit Insurance Regulations 12 C.F.R.
Part 330

Attachment:
Draft Federal Register Notice

Contact:
FDIC Call Center at 1-877-275-3342
FIL-99-2008 - PDF (PDF Help)

Printable Format:

Note:
FDIC financial institution letters (FILs) may be accessed from the FDIC's Web site at www.fdic.gov/news/news/financial/2008/index.html.

To receive FILs electronically, please visit http://www.fdic.gov/about/subscriptions/fil.html.

Paper copies of FDIC financial institution letters may be obtained through the FDIC's Public Information Center, 3501 Fairfax Drive, E-1002, Arlington, VA 22226 (1-877-275-3342 or 703-562- 2200).

Financial Institution Letters
FIL-99-2008
Revised as of October 8, 2008

Deposit Insurance Coverage
Changes to FDIC Deposit Insurance Rules for Revocable Trust Accounts

The FDIC Board of Directors has issued an interim rule to simplify the coverage rules on revocable trust accounts without decreasing coverage. The FDIC believes the interim rule will make the regulation easier for depositors and bankers to understand and apply. It will also result in more rapid deposit insurance determinations following bank closings and will help strengthen public confidence in the nation's banking system.

Background

Two types of revocable trust accounts are insured under the FDIC's coverage rules: informal trust accounts and formal trust accounts. Informal trust accounts consist of a signature card on which the owner designates the names of beneficiaries to whom the funds in the account will pass upon the owner's death. These are the most common type of revocable trust accounts and generally are referred to as "payable-on-death" (POD) accounts. The other type of revocable trust accounts are accounts established in connection with formal revocable trusts. Formal revocable trusts are created for estate planning purposes and are referred to as living or family trusts.

The FDIC's former rules stated that all revocable trust accounts (both POD accounts and living trust accounts) were insured up to $250,000 for the interest of each "qualifying beneficiary" designated by the owner of the account. Qualifying beneficiaries were defined as the owner's spouse, children, grandchildren, parents, and siblings.

Summary of the Interim Rule

The interim rule eliminates the concept of qualifying beneficiaries. The relationship between the trust owner and the beneficiaries no longer affects deposit insurance coverage. Under the interim rule, coverage is based on the existence of any beneficiary named in the revocable trust, as long as the beneficiary is an individual, a charity, or another nonprofit organization.

For revocable trust account owners with balances of $1.25 million or less in one FDIC- insured institution, the interim rule eliminates the former requirement that based coverage on the proportional interest of each beneficiary in the trust deposit. For each trust owner with combined revocable trust account deposits of $1.25 million or less at a single bank, the maximum coverage will be determined by multiplying the number of different beneficiaries by $250,000. (This will apply to the vast majority of revocable trust account owners.) Note that for revocable trust deposits that are jointly owned, the $1.25 million threshold would apply to each co-owner's share of all revocable trust deposits at one FDIC-insured bank.

For revocable trust accounts where the owner has more than $1.25 million in one FDIC- insured institution and has named more than five different beneficiaries in the revocable trust(s), the maximum coverage is the greater of either $1.25 million or the aggregate amount of all the beneficiaries' proportional interests in the revocable trust(s), limited to $250,000 per beneficiary. (The impact of the interim rule results in no depositor being insured for an amount less than he or she would have been entitled to under the former revocable trust account rules).

In addition, the FDIC reminds insured institutions that the rules for coverage of informal revocable trust (payable on death) accounts require that the names of all trust beneficiaries be disclosed in the institution's account records. The FDIC also encourages bank customers to make certain that the names of living trust beneficiaries are included in the bank's account records.

The attached draft Federal Register notice provides details on the rule changes. Once the interim rule is published in the Federal Register, the FDIC will distribute a copy of that document in a follow-up FIL and highlight the due date for comments.

Sandra L. Thompson
Director Division of Supervision and Consumer
Protection

Long-Term Care Insurance: Pricey But Necessary?

2008-10-12T07:53:00.000-05:00

One of the most common questions I get is "Should we purchase long-term care insurance? Is it worth it?" The answer to that question is up to the individual client, but usually people feel that it's "too expensive" as they pay it while healthy, and it transforms into a "lifesaver" when one becomes ill and the insurance is paying out.

The following is an article from AP Business Writer Dave Carpenter.

cHICAGO – Joyce Smith visited friends recently at a modern nursing home that made her thankful she has long-term care insurance. With relatively plush conditions, including large private rooms and lots of space and privacy, this was the type of safety net she could live with someday.

Turning to her husband, she said: “You keep paying that long-term care, Harry!”

While the Green Valley, Ariz., couple are healthy and hope they are years away from filing a claim, they figure they’ll end up in much better hands thanks to the long-term care policy they secured six years ago when Harry was 54 and Joyce was 60. They acted after watching Joyce’s mother Gladys fall ill and go into a nursing home without such protection, draining her life savings of $200,000 in 2 1/2 years.

“If you’re able to, you should have it,” Joyce says of the coverage. She takes comfort in knowing that she and her husband will be able to provide for any daily assistance they may need in later years.

The Smiths are among 8 million Americans with long-term care insurance — an area where insurers expect big growth as baby boomers zero in on their senior years.

The projections are high because the reality is that about 70 percent of people over 65 will require some type of long-term care services during their lifetime, according to the National Clearinghouse for Long-Term Care Information. It might come at any age, actually; 40 percent of people currently receiving long-term care are 64 or under.

But adding a significant extra cost can be daunting, especially at a time when many are focused on saving for retirement.

So can figuring out what level of benefits you want and how long a period to pay for. Most people get three, four or five years of coverage, because only 20 percent of today’s 65-year-olds will need care for more than five years. The more you sign up for, the higher the cost.

The price varies widely based on age, policy type, benefit level and number of years purchased, among other things, and can range from hundreds to thousands of dollars a year. Someone seeking protection equal to today’s average annual cost of care, about $55,000, would pay $1,064 a year for a standard policy purchased at age 55 or $2,013 for a similar policy at age 65, according to the American Association for Long-Term Care Insurance, an industry group.

As a benchmark, Consumer Reports Money Adviser recently noted that, in general, coverage may be largely unaffordable for people with a net worth below $200,000 to $300,000, not including their home. If you’re in that category, you will likely have to rely on government programs for any long-term care, which can cost you your choice of care facilities and, like Gladys, all your savings.

Other drawbacks also exist, including the limits and conditions of many policies.

But foregoing it is risky. Retiree health costs can be enormous without even factoring in the savings needed to cover long-term care expenses.

A man retiring at 65 in 2008 will need anywhere from $64,000 to $159,000 in savings to cover health insurance premiums and out-of-pocket expenses in retirement just for a 50 percent chance of having enough money, according to the Employee Benefit Research Institute, and $196,000 to $331,000 for a 90 percent chance.

A woman the same age would need $86,000 to $184,000 for a 50-50 chance and $223,000 to $390,000 to have a 90 percent chance.

The Smiths, who are retired, pay $4,995 a year for a joint policy with MassMutual that will provide extensive long-term care benefits for an unlimited time — now rare — when they become eligible by virtue of needing help with daily living activities. They consider themselves fortunate they locked in for that amount, having been told by their agent recently that it might cost triple the amount today.

“It’s one of those insurance products that’s kind of difficult to understand,” says Harry, a retired firefighter. “I studied it for nearly a year. ... But it gives you peace of mind to have it.”

Having the insurance also protects children from a potentially heavy burden.

“We’ve had friends tell us ‘We’re not getting long-term care, let the kids take care of us,”’ says Joyce, who with her husband has two daughters and a son. “Well, that’s not being very nice to the children. We don’t want our kids to have to take care of us.”

Long Term Care's Impact On The Family

2008-10-09T08:42:00.000-05:00

"Families are not necessarily drawn together in a time of crisis. Very often, they are blown apart." says Nancy Dykeman, an educator of long term care planners.

Nancy illustrates this problem with an example:

Imagine a young family. The father is working toward a career promotion; he coaches his kids' soccer teams. His wife works part time. They have two children. The mom's parents are retired, healthy and live in Arizona, playing golf and loving life. Then the unthinkable happens - the young mom suffers a stroke. Months of rehabilitation and care at home follow. Grandma and Grandpa travel back and forth from Arizona, often staying for long periods to help, even though their retirement dream is slipping away.

Dad must continue working to support his family, but his employer is tired of the time he spends on the phone and his coming in late or leaving early. A promotion is off the table.

What about the kids? Their mom, confidante and best friend is hurting and no longer fun. All of her energy goes into trying to recover. Kids' roles change too. They must help prepare meals, keep things picked up, and support their dad and grandparents.

Who knew this young wife and mother would need long-term care? Would the impact be different had it been one of the grandparents? Whenever anyone of any age needs long term care, it's a family issue.

Dykeman says that Long-term care insurance (LTCI) would have been a priceless gift for this family because it "protects the family, allowing them to think and work together without the stress and sacrifice of constant crisis mode." It also allows each family member to keep their normal role, rather than that of a caregiver.

Make sure you have a plan - it's critical for all adults, of any age. Whether it includes long term care insurance, annuities, or Medicaid planning and asset protection, consult with a professional to ensure you and your family are taken care of.

Do Your College Age Children Have Healthcare Directives? DO YOU?

2008-10-06T09:30:00.000-05:00

We should all protect our families and our assets with legal documents like wills and trusts, but what are our essential needs and what can we do on our own to save on legal fees? Family financial and legal expert, Alexis Martin Neely, is the author of "Wear Clean Underwear: A Fast, Fun, Friendly and Essential Guide to Legal Planning," and shared some valuable advice in an appearance this week on View From the Bay on KGO in San Francisco.

Alexis is the founder of the estate planning law firm of Martin Neely & Associates in Southern California, as well as the Family Wealth Planning Institute, a nationwide cadre of Personal Family Lawyers guiding parents to make the best legal decisions throughout life and being there for loved ones afterward.

She says everyone over 18 needs an Advance Health Care Directive & Durable Power of Attorney. If you have assets, you should also have a Will & a Living Trust. If you have minor children, you should also have a Kids Protection Plan.

She raised a great point that many parents don't think about - go watch the show to find out the important legal documents that all young adults need to have in place.

During the segment Alexis shares what legal documents you must have in place for you, and your kids! At the end, listen as she explains, what you should look for and the questions you should ask when searching for the perfect attorney to handle your family planning for a lifetime.

If you have college age kids, this is a VERY TIMELY and IMPORTANT topic. Make sure BOTH you and your adult kids have these important documents in place to avoid problems in the event they are injured or incapacitated.

Before you send them back to school, make sure these documents are in place!

If you have prepared these documents in the past, be sure to have them reviewed for compliance with HIPAA laws! Our office can help you with those needs, as well as the Kids Protection Plan, Wills and Living Trusts. If we can help you with these things, please contact us at 614.487.8887 x3 or through the Golowin Legal Website.

Two Legal Documents Every Adult Needs No Matter The Size of Your Bank Account

2008-10-02T09:30:00.002-05:00

As of your 18th birthday, you became an adult in the eyes of the law.

Even though your kids may still act like teenagers (or you may feel like one), in the eyes of the government, turning 18 means you need to have legal documents in place in case of an accident.

Every adult should have in place an Advance Health Care Directive and a Financial Durable Power of Attorney. Estate planning is not just for rich people. These legal documents are important for everyone who loves their family.

If you don’t have these legal documents in place and something scary happens, it will make life a whole lot more difficult for the people you love.

An Advance Health Care Directive (also known as a Health Care Power of Attorney and Living Will) does two things: first, it names the person you want making health care decisions for you if you cannot make them for yourself and second, it lets that person know how you want them to be made.

This is important because if you are in the hospital and cannot communicate, you need someone to make decisions for you and you want them to make those decisions as you would want them made, without question.

If you don’t have this document in place, it could create a huge rift among your family as the people you love fight about what you would have wanted.

The important thing in this document is that the whoever you name is also given authority under the new (within the past three years) Health Insurance Portability and Accountability Act (aka HIPAA).

If your health care agent (the person named in your Advance Health Care Directive) is not designated as your agent under HIPAA, they will not be able to look at your medical records, which makes it mighty hard for them to make health care decisions for you.

By the way, if you have college age kids going off to college, you’ll want to get this in place for your kid. Otherwise, when you call the school nurse to discuss your child’s illness, you may find no one can or will talk with you because they would violate HIPAA if they did.

We get frantic calls in our office at least once or twice each fall from parents looking for legal documents for their college-age kid for just this reason.

The second legal document you absolutely need to have in place as an adult is a Durable Power of Attorney. This document names someone to make financial and legal decisions for you if you can’t make them for yourself.

Beware of the one-page standard durable power of attorney you find on the internet where you just check off a list of applicable powers. I’ve seen family members try to use those to access their loved ones assets and then not be able to because the form was too generic.

It’s important for your kids going off to college to have this in place too because if they are in an accident you are going to need to take over paying the bills and get access to bank accounts and make legal decisions. But, you will have to go through a long and expensive court process if there’s not a signed Durable Power of Attorney in place.

It’s the same for you too. If you are in an accident, and you don’t have a Durable Power of Attorney in place,it will be difficult for your family to deal with things on your behalf.

So, regardless of the amount of money you have in the bank, get your Advance Health Care Directive (or living will) and your Durable Power of Attorney in place at the bare minimum. Oh, and of course, if you have kids under 18 at home, get your comprehensive Kids Protection Plan in place too.

None of this has to do with money. It has to do with making life as easy as possible for the people you love. Contact Golowin Legal today to protect your loved ones.

SOURCE FOR POST: Family Wealth Matters by Alexis Martin Neely

What To Do If You Can't Decide Who To Name As Guardians For Your Kids

2008-09-29T07:30:00.001-05:00

There are a lot of parents out there who have not named
guardians for their kids because they really can't decide.

You might be one of them.

But, here's the thing. If you don't decide and something happens to you, the decision gets made by a Judge.

You don't want that, do you?

Here's a few things that may help you decide:

1. Think through on a practical, realistic and non-emotional (to the extent you can) level who would come forward to raise your kids if you were in an accident.

2. Is that who you would want to raise your kids?

3. If not, who would be better than that person or those people?

4. If more than one person would come forward, who
would a Judge pick if the Judge had to decide between all
the people who would come forward?

Bottom line?

If you don't decide, a Judge will. Even your worst choice would be better than that, right?

The free KidsProtectionPlan.com website will walk you through the entire process of choosing the right guardians for your kids and then legally document your decisions.

If not knowing who you want to name has been holding you back, don't let it hold you back a second longer.

Do it now. It's Free. It's Easy. No Excuses.

SOURCE: Alexis Martin Neely, who is a mom, writer, speaker and the Personal Family Lawyer you love. Alexis makes it super easy for your family to talk about and plan for sticky subjects like money, death and taxes. Find your own Personal Family Lawyer at www.PersonalFamilyLawyer.com. Get Alexis' humorous, enlightening, and often quite revealing Family Wealth Secrets by visiting her website at www.FamilyWealthMatters.com.

Your Parents, FDIC and Keeping Your Money Safe

2008-09-27T14:57:00.003-05:00

Timely discussion on how to protect your money held within financial institutions. Can you shield more than $100,000 via FDIC protection? Absolutely!

Don't fail to take advantage of these valuable planning techniques!

A Grave Issue of Parenting – Writing Wills and Choosing Guardians

2008-09-25T09:00:00.000-05:00

The following article, which appeared in the Orange County Register, features an interview with fellow Personal Family Lawyer Darlynn Morgan of The Morgan Law Group in Newport Beach, California.

Tips for making sure your children are cared for in the event of your death.

"Mommy, what happens after you die?"

It's a question most kids ask at some point – and we may quickly paint a picture of fluffy clouds, golden roads, rainbows and go about our day.

It's a question parents rarely want to truly consider. But ask yourself – what would happen to your kids if you died? Who would take care of them?

"A will may not be enough," says attorney Darlynn Morgan of The Morgan Law Group in Newport Beach. Morgan, a personal family lawyer, offers estate planning tips and advice to parenting and moms' groups, with a particular focus on children.

Here are her tips for ensuring your children's future in the event of your death:

•If both parents can't agree on a suitable guardian for the children, don't give up. Find a mediator who can help you to come to a mutual agreement for the benefit of the kids.

•When you name a couple to act as guardians, be sure to indicate what should happen if the couple broke up or one of the partners in the couple died. You want to ensure your children don't end up in the care of someone you wouldn't really want.

Name several alternate guardians if your first choice can not serve.

•It isn't necessary to take into account the financial resources of potential guardians when deciding who should raise your children. Your guardians are the people who will be in charge of your kids' emotional, spiritual and physical well-being, not necessarily their money.

It's your responsibility to leave enough money behind to take care of your kids either through savings or life insurance, and someone to manage that money if the guardians are not good money managers.

It's also a good idea to provide someone to manage your children's money so a lump sum doesn't go to your children at age 18 – without adult supervision.

•Be sure to name short-term guardians as well as long-term guardians. Short-term guardians will offer immediate care of your kids if you were in an accident. Otherwise, your kids could be taken out of your home and into the arms of strangers (child protective services) until the authorities figure out what to do.

•Be sure to specially name anyone you want excluded as guardians – those who might challenge your decisions or who you would never want raising your kids. (A grandparent or aunt or uncle, for example, who may fight the guardians for custody).

For a list of Morgan's upcoming speaking events, visit Morgan Law Group.

SOURCE: Orange County Register in an article written by CYNTHIA RUPE

Keep Your Memory Sharp With A Social Life

2008-09-22T07:30:00.000-05:00

A recent Harvard School of Public Health (HSPH) study found that people with the highest level of social integration had the slowest rate of memory loss, with the most active experiencing memory loss at less than half the rate of the least integrated people.

So there you have it! The perfect excuse to keep up that weekly golf, bridge, church or other activity!

Couples Face Pitfalls When Estate Planning In A Second Marriage

2008-09-18T17:57:00.005-05:00

Attorney Stephen M. Worrall writes the following in his Georgia Wills, Trusts and Estate Planning Blog. This centers upon an issue that is constantly overlooked, creating drastic and unfortunate impact upon the estates of many people! Don't overlook the importance of planning in second marriage situations.

Our greatest challenge is planning the estate for second marriage clients. The blended family carries with it a number of competing concerns as we prepare wills and trusts to meet their needs.
If the couple is financially sound with adult children from their former marriages and have a prenuptial agreement, our task becomes fairly easy. The challenge comes with the scenario wherein the surviving spouse would need the assets from the first to die, yet the first to die would ultimately want for his or her children to inherit once the surviving spouse passes.
The problem with leaving all of the assets to the spouse is that the spouse is under no legal duty whatsoever to include the children of the deceased spouse in his or her will or trust. The children of the first to die become disgruntled when their relationship with their step-parent begins to fade for fear they will never inherit anything from their parent. Invariably they feel that their parent would never have intended the inevitable result.
By way of illustration, let's assume that Tom has two children from his previous marriage, Terri and Tim. His wife, Julie, has two children from her previous marriage, Jack and Jennifer. Should Tom's will leave his assets to Julie? What about Terri and Tim? What should Julie's will say? In such a scenario, there are several options.
We explain the options to our clients as spectrum ranging from complete control of the assets from the grave to little or no control. The first-to-die spouse can control the assets by giving the surviving spouse lifetime rights over the assets, but when the survivor dies, the remaining assets must pass to the children of the first to die. This can work well for those children, but the surviving spouse often is uncomfortable with the feeling of being controlled .
The other end of the spectrum would be to simply leave the assets to the surviving spouse and trust that the survivor would provide for the deceased spouse's children in his or her trust in the future. While this latter option sounds nice, often the relationship between the stepchildren and step-parent fades as years go by and the stepchildren are typically disinherited in the end.
We like to see a hybrid approach taken. First, using our example, we recommend that Tom's estate plan provides that Terri and Tim first be left some amount outright and then provide the remaining assets to Julie - some restricted and some not restricted. The assets typically not to restrict would be the marital residence and retirement assets.
Life insurance proceeds and other investment liquid assets could pass to a "QTIP" trust whereby Julie could withdraw funds from this trust for the rest of her lifetime, but at Julie's subsequent death, the remaining QTIP trust assets revert back to Terri and Tim. "QTIP" stands for Qualified Terminable Interest Property and was created by Congress in early 1980s.
Each and every case is different but perhaps some combination of the above should be considered when the difficult challenge of planning the estates of the blended marriage is encountered.

SOURCE: Naperville Sun in an article by Richard W. Kuhn

Tips on Selling Your Senior's House

2008-09-17T08:10:00.004-05:00

Many seniors are faced with the task of selling their home after they decide to move into a senior-living community. At that point, the question becomes "how can I make this as easy as possible"?

Colleen Krupp, Health Services marketing director for First Community Village in Upper Arlington, Ohio, relayed the the following tips from relocation expert Joe Evans Realty Group:

1) Pack up your personal items so they're out of sight. The people who are considering buying your home are trying to visualize themselves living there. Your personal photos and other items will only distract them.

2) Update your house. If you haven't modernized your home in the last 10 years, it probably won't be received well on the market. Consider eliminating wallpaper, laminate flooring and old bathroom fixtures, to start.

3) Evaluate the market. Take a look at the other similar homes, and take a close look at which ones are selling - and copy that as much as possible.

4) Find the pricepoint. In this down market, you might consider pricing to sell rather than holding on and let months go by without a look.

5) Get an inspection. By showing potential buyers an inspection, you'll move to the top of the heap and buyers will be more comfortable.

6) Be ready to go. If you're flexible as to when the buyers can move in, you'll only make your home more attractive.

Planning ahead is key, and will take a lot of stress out of this process.

Heath Ledger's Will Fails His Family

2008-09-01T11:55:00.003-05:00

This morning I saw that the newest Batman movie, "The Dark Knight" had earned about 1/8th of the total summer box office. I began wondering how much money Heath Ledger, starring as the Joker, earned from this blockbuster.

I didn't find a current estimate of his take, but whatever it was, it's the center of a heated debate. Heath Ledger joins the list of wealthy celebrities that died without a proper estate plan. As you can see in this article from several months ago, Mr. Ledger's will was outdated (I'm shocked he even had one) and did not leave a penny to his child!

Remember - estate planning isn't a one time event. To ensure you and your loved ones are protected, it takes regular review to make sure your wishes are fulfilled.

Home Instead Senior Care

2008-03-05T08:05:00.004-05:00

Home Instead Senior Care is a company that serves around 200 Central Ohio senior citizens that live in their homes. They suggest that adult children will speak to their parents who are in their 70's about various issues to ensure the senior's needs are met.

Their "40-70" program is organized nationwide through the Home Instead Senior Care franchise,, and it offers various resources at 4070talk.com. These materials include a "conversation starter guide", an "online communications assessment", and a "communications guide". A booklet can be ordered online or by calling (614) 849-0200.

They emphasize talking early about aging issues so that there is less of a communication barrier when issues pop up later.

Eons.com - An Online Community for 50+ Americans

2007-04-28T07:06:00.001-05:00

This website follows in the footsteps of popular websites such as MySpace.com and Facebook.com. These websites are an "online gathering place" which are very popular with teens and young adults.

Eons.com is similar, but specifically made for the 50+ crowd. It includes networking tools, information on "body", "money", "love" and "fun", as well as a search engine designed to find items related to the users stage in life.

Give Eons.com a try and leave a comment as to whether you find it useful!

What is The New Medicaid Lookback period?

2007-01-17T10:12:00.000-05:00

What is the appropriate Medicaid Look-Back period under the DRA?

This is an important question for anyone making a Medicaid application in that the local office will request financial records for the time period of the Look-Back. I find it can be very difficult to gather 3 years of records for a senior who now requires Medicaid to pay for his or her long term care, and 5 years is an even greater burden.

So what is the Look-Back Period? I had been going with 60 months, as until recently all the States that had created the DRA enacting legislation had used that timeframe.

However, in Most States Fudging DRA Look-Back Change from Elderlawanswers.com, there is an excellent analysis that the states may have the changes to the Look-Back Period wrong.

In New York's enacting legislation, they have taken note of the fact that that DRA did NOT in fact changes the Look-Back Period from 36 months to 60 months. Instead, it said that IF there had been a transfer in the 60 months after enactment, THEN there was a 60 month Look-Back for the transfers.

New York then has taken a staggered approach to the Look-Back Period, since 60 months obviously have not expired since the DRA was enacted. For the first 36 months, the Look-Back Period remains 36 months (since any transfers would be before the DRA was enacted). The Look-Back Period then extends to 37 months in the 37th month after the DRA to capture any transfer in that month, until it finally reaches 60 months.

This approach appears to resolve the issue of the 60 month Look-Back for transfers after 2.8.06 with the 36 month Look-Back period in the Code not being changed by the DRA.

One would hope that in creating its enacting legislation to the DRA that New Jersey would take such a measured approach as well.

Most States Fudging DRA Look-Back Change - Elder Law Answers Articles:

"Since 1993, the look-back date on a Medicaid application for long-term care coverage has been 36 months, 42 U.S.C. S. 1396p(c)(1)(B), and this figure was not erased by Congress in the amendments to the statute it made through the DRA. Instead, the 36-month figure was preserved and a 60-month look-back date was added to the statute but made applicable only to transfers that occurred after the DRA effective date.

The last time Congress made any modification to the look-back date was in the Omnibus Budget Reconciliation Act of 1993, P.L 103-66 (OBRA-93), when it simply deleted '30' from the statute and replaced it with '36,' and thereby left little doubt that it intended to increase the look-back period on all prospective applications to 36 months. But Congress chose not to make the change in the same manner in its DRA amendments. In keeping the 36-month figure in the statute, Congress was clearly indicating that a 36-month look-back date is still applicable in some fashion. By attaching the 60-month look-back date to transfers made after the DRA enactment date, as opposed to applications filed after that date (a la OBRA-93), the design was obviously to at least phase in the extended look-back date over time. Based on the language Congress used in the DRA, the look-back period cannot be greater than 36 months until at least February 2009, because that will be the first point at which an
individual will have possibly made a transfer that occurred more than 36 months after the DRA enactment.

Agreeing with this reading of the DRA statute, New York keeps the look-back period at 36 months (60 months for trusts) until February 1, 2009. Beginning on that date, Medicaid offices will require resource documentation for the past 37 months (60 months for trusts). "

This is a confusing issue. Before you rely on "the grapevine", consult an elder law attorney who can help you sort through the convoluted laws of Medcaid.

Social Security E-mail Scam

2006-12-18T08:44:00.000-05:00

Beware e-mails that look to be sent from the government regarding Social Security, as they are a scam to obtain your personal information.

These messages have a subject line of "Cost-of-Living for 2007 update" and have a bit of information about a benefit increase for 2007. The email states:

NOTE: We now need you to update your personal information. If this is not completed by November 11, 2006, we will be forced to suspend your account indefinitely.

The reader is linked to a fraudulent website where the user is asked to enter their personal information to avoid losing the Social Security benefits.

Remember: The Social Security Administration (SSA) will not request your personal information online. In fact, SSA Inspector General O’Carroll recommends people always take precautions when giving out personal information. She says:

You should never provide your Social Security number or other personal information over the Internet or by telephone unless you are extremely confident of the source to whom you are providing the information.

If you have received this scam email, call 1-800-269-0271 (TTY: 1-866-501-2101) to report it.

Advancing Excellence in America's Nursing Homes

2006-12-18T08:34:00.000-05:00

On September 29, 2006 the National Nursing Home Quality Summit was held in Washington, D.C.

The Advancing Excellence in America's Nursing Homes website describes their work as follows:

Advancing Excellence in America's Nursing Homes is a new coalition based, two-year campaign that launched in September 2006. The campaign is reinvigorating efforts to improve the quality of care and quality of life for those living or recuperating in America's nursing homes.
The campaign's unprecedented coalition includes long-term care providers, caregivers, medical and quality improvement experts, government agencies, consumers and others. Together, we are building on the success of other quality initiatives, including Quality First, the Nursing Home Quality Initiative (NHQI), the culture change movement, and other quality initiatives.
Learn more about the campaign and its goals.

To learn about how you can help by registering as a Nursing Home consumer, visit this link.

Web Link - Ohio Association of Senior Centers

2006-10-24T07:26:00.000-05:00

The Ohio Association of Senior Centers exists to support and enhance the ability of Ohio's senior center network to effectively serve older adults by providing 1) education, mentoring, and training to senior center and aging network staff; 2) professional senior center staff certification; 3) development of new funding resources; and 4) information on legislative issues and organized advocacy efforts on behalf of older Ohioans.

Click here for OASC Member Senior Centers.

Coping With The Sudden Death of an Elderly Parent

2006-10-18T13:36:00.001-05:00

Lucy Whelchel works with businesses, professionals, and agencies to prepare for the demographic shift to an aging America. In her article "Coping With the Sudden Death of an Elderly Parent", she reminds us that even when we don't plan ahead, there are resources for spouses or family members in crisis.

Ms. Whelchel reccomends calling or visiting the website of the National Association of Professional Geriatric Care Managers. Members of this organization ore knowlegeable about aging, as well as the services and programs available to families. Care managers often create plans of action aimed at meeting the specific needs of that person, and may help on a daily basis to help with daily activities or to find appropriate housing.

Second, the Area Agency on Aging is a reccomended resource. The Agency for your community can be found by visiting the Eldercare Locator Website. This can link to services such as "Meals on Wheels, senior centers, home nursing and personal care, respite care for caregivers, homemmaking and chore services, adult day care, senior victims advocate programs, injury prevention and protection programs, information on Medicare, Medicaid, Medigap and Long Term Care Insurances, Alzheimer's Disease and other dementias servicses, transportation, senior employment services, long term care ombudsman programs, and health promotion and disease prevention."

Finally, Ms. Whelchel points out that those that are 85 and older will increase by 56% from 2010 to 2030, and the number of persons from 65 to 84 will increase by 81% from 1010 to 2030. The important piece to take out of this article is to realize that planning for these changes and the aging of your family and loved ones can ensure that all live a full, healthy life.

Squidoo Lens - Elder Law

2006-10-11T09:35:00.000-05:00

Check out my Squidoo Lens on Elder Law. It has many links and is generally a portal I've created for you to access information related to issues you may be facing. Please sign the guestbook and leave a suggestion so that I may make it better!

Thank you!

Where Can I Check Out My Financial Adviser?

2006-10-07T08:15:00.000-05:00

Visit the Securities and Exchange Commission website to make sure that your financial adviser (or a potential advisor that you're interviewing) is on the "straight and narrow".

You can download the adviser's "form ADV" to find out if he or she has ever been disciplined by the SEC or another ageny, what type of misconduct was found, and the resolution. There is also information on the adviser's education and business. For Ohio-specific information, visit the Ohio Department of Commerce - Securities Division.

Be aware, however, that I am told only advisers that manage more than $25 million in assets must register with the S.E.C. This means that many advisers may not show up on this webpage, which does not necessarily mean that adviser is "good" or "bad".

I've had the good fortune of creating some good working relationships with advisers with many varied backgrounds. I find that they are often a valuable, even indispensable, part of creating the best plans for my clients. For more information about retirement planning with your IRA or 401(k), feel free to contact me today.

The "Senior Sandwich"

2006-10-05T14:06:00.001-05:00

The "Senior Sandwich" generation refers to persons over 60 years old and who face costs related to 1) college tuition for thier kids, 2) retirement for themselves, and 3) at-home or nursing home care for thier parents, all at once.

The fact that nearly 50% of people in thier 60's today have at least one parent still living is a far cry from the near 10% at the beginning of last century. This means that these families are facing concerns and problems that no generation before them have had to face. The bottom line can be a crushing financial burden.

Jean Chatzky of Money Magazine suggests in "Just When You Thought It Was Safe to Retire" that if you're already in your 60's you might plan to work a little longer, live a little leaner, and encourage your kids to study hard and qualify for merit aid. She goes on to sugges that if you are planning ahead in your 40's or 50's you're in a better spot, especially if you focus on the following:

1) Fit kids into your budget. When you make projections about your annual spending in your retirement years, be sure to plan for the possibility that one of your kids moves back home! This can increase food, utilities, and other costs.

2) Ask your parents hard questions. Understanding what sort of assets your parents have, and what type of lifestyle they wish to live is important. Ask them the following: How expensive a lifestyle do they want to live for the rest of thier life? Where do they want to live, and in what kind of home? What sort of health-care and lifesaving measures do they want to have taken, if needed? Who do they want to put legally in charge of carrying out all of these wishes?

3) Consider insurance. Long term care is very expensive. Buying long term care insurance may bring a great deal of financial secuirty, and personal comfort.

4) Look out for No.1. Too often those in the "sandwich generation" put thier own needs last. If you ruin yourself financially (by neglecting your own needs) at this point to take care of those around you, you'll only be setting up your children to face these difficulties later.

If you are a card-carrying member of the "sandwich generation" and you'd like to learn more about how to help implement a plan to make sure you and your family members are taken care of personally, legally, and financially, feel free to contact an elder law lawyer for assistance.

Look Closer, See Me

2006-10-04T08:53:00.000-05:00

I am told that this poem was found with the belongings of an elderly woman who died in the geriatric ward of a hospital near Dundee, Scotland. It is a powerful piece that should remind us all that a failing mind or body does not change who we are. I hope it helps you in some way.

If you can share a story, or any way that this poem affects your life, please leave a comment or contact Golowin Legal.

Look Closer, See Me

What do you see nurses, what do you see?
Are you thinking when you are looking at me— A crabby old woman, not very wise,
Uncertain of habit, with far-away eyes.
Who dribbles her food and makes no reply,
When you say in a loud voice—"I do wish you'd try."
Who unresisting or not, lets you do as you will,
With bathing and feeding the long day to fill.
Is that what you are thinking—is that what you see?
Then open your eyes, nurse, you're not looking at me.
I'll tell you who I am as I sit here so still;
As I do at your bidding, as I eat at your will,
I'm a small child of ten with a father and mother,
Brothers and sister, who love one another.
A young girl of sixteen with wings on her feet,
Dreaming that soon now a lover she'll meet;
A bride soon at twenty—my heart gives a leap,
Remembering the vows that I promised to keep;
At twenty-five now I have young of my own,
Who need me to build a secure, happy home;
A woman of thirty, my young now grow fast,
Bound to each other with ties that should last;
At forty, my young sons have grown and are gone,
But my man's beside me to see I don't mourn.
At fifty, once more babies play round my knee.
Again we know children, my loved one and me.
Dark days are upon me, my husband is dead.
I look at the future, I shutter with dread,
For my young are all rearing young of their own,
And I think of the years and the love that I've known.
I'm an old woman now and nature is cruel—
'Tis’ her jest to make old age look like a fool.
The body it crumbles, grace and vigor depart,
There is now a stone where I once had a heart;
But inside this old carcass a young girl still dwells,
And now and again my battered heart swells.
I remember the joys, I remember the pain,
And I'm loving and living life over again.
I think of the years all too few—gone too fast,
And accept the stark fact that nothing can last.
So open your eyes, nurses, open and see
Not a crabby old woman, look closer see me!

Courtesy of the Peninsula Hospital Center, Far Rockaway,
New York, and Greater New Hospital Association.

Golowin Legal is your source for elder law, estate planning, probate and asset protection.

How Can I Save On My Energy Bill?

2006-10-03T10:18:00.001-05:00

Visit the Department of Energy for money saving tips to learn how to keep dollar bills from slipping away (under the door, through the windows, and down the drain).

This site features an "energy audit" and other tools which show you how to do things such as check insulation, plumbing, or even to compare gas mileage in different models of cars.

Another section of this site educates on which tax credits are available for energy-conscious consumers. For example, installing a central air conditioning system can give you a $300 tax credit!

Web Link - Wills of the Famous (Part 2)

2006-09-24T14:42:00.000-05:00

The British National Archives has collected some famous wills from long ago. These include William Shakespeare, Jane Austen, Byron, and Sir Francis Drake.

Enjoy!

Web Link - Wills of the Famous

2006-09-19T12:19:00.000-05:00

CourtTV's Wills of the Famous allows you to see the wills of various celebrities, from Joe DiMaggio, Marylin Monroe, Elvis and even Princess Di.

You'll notice that some of them don't have much information for our prying eyes to see. This is because their living trust owned thier assets during life, which controlled who got thier "stuff" and when they got it. This way, the public does not see exactly who inherited, and who did not. To some, this privacy is extremely valuable.

If you are interested in why you may prefer a living trust centered estate plan rather than a will based plan, contact an estate planning attorney today.

Caregiver Agreement Follow-Up - Details

2006-09-15T09:54:00.000-05:00

If you read my prior post on caregiver agreements (also known as "personal care contracts" or "personal service contracts"), you know that they are a valuable tool. But knowing that they are out there is not enough! You need more!

This follow up to the Wall Street Journal article provides some additional infrormation and quotes several elder law attorneys on the topic. For more information on elder law, estate planning or medicaid planning, feel free to contact me today.

Setting Up a Contract For Who Will Mind Mom
By Rachel Emma Silverman
From the The Wall Street Journal Online
Trish Richert recently signed a binding employment contract. In exchange for taking care of a 77-year-old woman -- arranging and taking her to doctors' appointments, doing her bills, keeping her house tidy -- Ms. Richert, of Greensboro, N.C., receives a modest stipend that covers travel expenses and other costs.

Ms. Richert's employer: her mother. The two recently entered into a so-called caregiver contract -- a formal agreement, set up by a lawyer -- in which Ms. Richert, 45, receives a small payment for the long hours she spends caring for her mom.

A small but growing number of families are setting up caregiver contracts, in which adult children or other relatives are hired, for modest salaries, to take care of elderly or disabled family members. These arrangements, which are also called personal-service or personal-care agreements, can help reduce the size of a parent's estate and thereby improve their chances of becoming eligible for long-term-care coverage under Medicaid. They can also minimize battles between siblings and other family members. For many other families, the contracts simply help reward the significant amounts of time, effort and money that family members often spend watching over and taking care of an elderly relative.

There aren't any national statistics on how many family members are compensated for caregiving. But a huge swath of Americans already provide long hours of voluntary care for family members and friends -- and these numbers are likely to grow as the population ages and more people live longer. Some 44.4 million adult caregivers -- or 21% of the U.S. adult population -- provide unpaid care to seniors or adults with disabilities, according to a 2004 study by the National Alliance for Caregiving in Bethesda, Md., a research and advocacy coalition, and AARP, the Washington advocacy group for seniors. On average, those caregivers provide 21 hours of care a week; the average length of time spent providing care is 4.3 years.

Many caregivers have to balance their family duties with their real jobs. Nearly 60% of caregivers either work or have worked while providing care, the study found, with many having to make adjustments to their work life, including reporting late to work or even giving up their jobs entirely.

Kathy Nalven is in the process of drawing up a caregiver contract with her mother's 88-year-old fiancé, Edward Campbell. Ms. Nalven, a Fort Lauderdale, Fla., real-estate broker who is in her 50s, has agreed to take care of Mr. Campbell, but "the parameters have to be really clear," she says. "If it means that I can't work because I'm busy taking care of him, which I'm very willing to do, I need to be compensated. I'm not a saint." Ms. Nalven and Mr. Campbell both say that the terms of the arrangement are still being worked out.

Elder-lawyers and caregiver advocates say that more people are considering compensating family members for their efforts. In recent weeks, Jennifer Cona, a Melville, N.Y., elder-law attorney, has drafted five caregiver contracts. Before that, she had drawn up only three in the preceding couple of years. "We're seeing a real increase," she says.

"I know in my own practice they are definitely increasing," adds Lauchlin Waldoch, a Tallahassee, Fla., elder-lawyer. "People are more receptive to them now."

Qualifying for Medicaid

There's another key reason for the uptick: Legislation passed earlier this year makes it tougher to qualify for Medicaid long-term-care coverage by making outright gifts to family members. The measures were passed to prevent seniors who have the means to pay for their own care from obtaining Medicaid, which is intended for poor patients. Lawyers say that if set up properly, caregiver contracts shouldn't be considered gifts to children because the patient is receiving a real service in return.

Medicaid isn't likely to "disqualify you for making those payments to your children if you have an arm's length, commercially reasonable contract, in writing, ahead of time," says Charles Sabatino, director of the American Bar Association's Commission on Law and Aging in Washington. Scott Solkoff, a Boynton Beach and Miami, Fla., elder-lawyer, says he has drafted more than 250 caregiver contracts in recent years; about half of the arrangements, he says, have been "Medicaid-driven."

Still, there's a lot of stigma to overcome when recommending the idea to families, lawyers say. The main reason: "People are still uncomfortable with the idea that you are paying your kids," says Palo Alto, Calif., lawyer Michael Gilfix.

Indeed, when Ms. Richert first heard about the contracts from her mother's lawyer, A. Frank Johns of Greensboro, N.C., "it felt funny," she says. "It's hard to put a dollar figure when you are doing something for your mom."

Advisers and family members say the deals are also smart because a formal arrangement, done ahead of time, can minimize feuds among siblings and other relatives. Oftentimes, one child serves as a primary caregiver and a parent may reward him or her by making informal gifts or by doling out a bigger piece of the estate in the will. Unfortunately, those arrangements can lead to family fights or will contests.

A formal caregiver contract, drafted ahead of time, makes the arrangement "more iron-clad," says New York elder-law attorney Bernard Krooks. "You have a written document showing this is what mom wants you to do and what mom wants to do for you. It helps avoid family squabbles." But lawyers say it's important to discuss the contract with other siblings or relatives so they are aware of the arrangement ahead of time; that can help minimize family tensions later.

Terry Huffines, of Brown Summit, N.C., set up a caregiver contract with her aunt, who is 92 years old, to help avoid any estate problems down the road with her aunt's 15 additional nieces and nephews. The agreement, set up by Mr. Johns, the Greensboro, N.C., lawyer, outlines the services Ms. Huffines, 72, will provide for her aunt, including driving her to the doctors, the grocery store and other household chores.

In order for a caregiver contract to be respected -- and to pass muster with Medicaid authorities -- it has to follow certain formalities. For one, you can't pay the caregiver an inflated rate in order to shift lots of money out of your estate. Instead, you should specify what duties the caregiver is expected to perform and then contact local home-care agencies or geriatric-care managers to establish the market value of those services in your area. Such duties can vary from preparing meals, bathing and dressing to housecleaning and chauffeuring, as well as arranging doctor's appointments and friends' visits and overseeing medications.

Cost Varies Widely

The cost of care varies widely, depending on location and the services being performed, and can range from about $15 an hour to more than $100 an hour. Some families choose to pay a discounted rate to family caregivers, which is also acceptable, lawyers say. It's also much better to set up the caregiver contract when the incapacitated adult is of sound mind, as the arrangements can become far more complicated if a person acting as power of attorney signs the contract.

The contract should also specify whether the payment will be done in one upfront lump sum based on the senior's life expectancy -- a technique often used for Medicaid-planning -- or in regular weekly or monthly payments. It's also wise to create safeguards to prevent a caregiver from taking the money and running, such as depositing paychecks into an escrow account rather than to the caregiver directly.

There are also tax consequences to consider. The compensation is considered ordinary income, so the caregiver has to pay income taxes on the payment. Also, depending on how the contract is structured, Social Security and other payroll taxes may have to be withheld.

Many lawyers say they generally only set up the contracts as part of more-comprehensive estate plans, including power-of-attorney documents and wills, but that the arrangements can cost anywhere from about $500 to several thousand dollars to create.

It's smart to check whether there are other sources of funding you can use to pay family members. Some long-term-care insurance policies, such as those that pay lump-sum "indemnity" benefits, may be used to pay family members who provide care, says Jesse Slome, executive director of the American Association for Long Term Care Insurance in Westlake Village, Calif. If you already have a policy or are considering one, see if the coverage will allow you to pay family members for their caregiving services.

In addition, some state or federal government programs provide funding to compensate family members in what is known as "consumer-directed care." For instance, a growing number of states have a "Cash & Counseling" program for Medicaid enrollees that allows participants to pay family members for their services. Contact your local agency on aging or department of social services for more information on government funding.

Email your comments to cjeditor@dowjones.com.

-- September 13, 2006

Caregiver Agreements and Medicaid

2006-09-14T23:14:00.000-05:00

This recent Wall Street Journal article discusses a valuable planning technique for seniors who need help with thier daily activities, do not wish to move out of thier home, and have a relative who is willing to provide daily care.

In short, caregiver agreements are written contracts in which a relative agrees to care for a loved one for a specified amount of money. Not only do they help ensure the senior recieves the care they need in the comfort of thier home, but their assets are being transferred with no penalty under the Medicaid laws.

Without the use of a caregiver agreement, many children care for thier parents out of the goodness of thier hearts for years without any compensation. Unfortunately, in instances where the parent eventually needs nursing care, the senior must spend down essentially all of thier assets. The end result is that they leave thier loving child or family member nothing as an inheritance. Many times seniors would rather pay thier relative to care for them, even if the relative would gladly do it for free.

For more information, contact an Ohio Medicaid Attorney.

Who Will Mind Mom?
Check Her Contract

Seniors Turn to Written Agreements to Compensate
Relatives as Caregivers; Reducing Estate Size

By RACHEL EMMA SILVERMAN
September 7, 2006; Page D1

Trish Richert recently signed a binding employment contract. In exchange for taking care of a 77-year-old woman -- arranging and taking her to doctors' appointments, doing her bills, keeping her house tidy -- Ms. Richert, of Greensboro, N.C., receives a modest stipend that covers travel expenses and other costs.

Ms. Richert's employer: her mother. The two recently entered into a so-called caregiver contract -- a formal agreement, set up by a lawyer -- in which Ms. Richert, 45, receives a small payment for the long hours she spends caring for her mom.

A small but growing number of families are setting up caregiver contracts, in which adult children or other relatives are hired, for modest salaries, to take care of elderly or disabled family members. These arrangements, which are also called personal-service or personal-care agreements, can help reduce the size of a parent's estate and thereby improve their chances of becoming eligible for long-term-care coverage under Medicaid. They can also minimize battles between siblings and other family members. For many other families, the contracts simply help reward the significant amounts of time, effort and money that family members often spend watching over and taking care of an elderly relative.

There aren't any national statistics on how many family members are compensated for caregiving. But a huge swath of Americans already provide long hours of voluntary care for family members and friends -- and these numbers are likely to grow as the population ages and more people live longer. Some 44.4 million adult caregivers -- or 21% of the U.S. adult population -- provide unpaid care to seniors or adults with disabilities, according to a 2004 study by the National Alliance for Caregiving in Bethesda, Md., a research and advocacy coalition, and AARP, the Washington advocacy group for seniors. On average, those caregivers provide 21 hours of care a week; the average length of time spent providing care is 4.3 years.

Many caregivers have to balance their family duties with their real jobs. Nearly 60% of caregivers either work or have worked while providing care, the study found, with many having to make adjustments to their work life, including reporting late to work or even giving up their jobs entirely.

Kathy Nalven is in the process of drawing up a caregiver contract with her mother's 88-year-old fiancé, Edward Campbell. Ms. Nalven, a Fort Lauderdale, Fla., real-estate broker who is in her 50s, has agreed to take care of Mr. Campbell, but "the parameters have to be really clear," she says. "If it means that I can't work because I'm busy taking care of him, which I'm very willing to do, I need to be compensated. I'm not a saint." Ms. Nalven and Mr. Campbell both say that the terms of the arrangement are still being worked out.

Elder-lawyers and caregiver advocates say that more people are considering compensating family members for their efforts. In recent weeks, Jennifer Cona, a Melville, N.Y., elder-law attorney, has drafted five caregiver contracts. Before that, she had drawn up only three in the preceding couple of years. "We're seeing a real increase," she says.

"I know in my own practice they are definitely increasing," adds Lauchlin Waldoch, a Tallahassee, Fla., elder-lawyer. "People are more receptive to them now."

Qualifying for Medicaid

There's another key reason for the uptick: Legislation passed earlier this year makes it tougher to qualify for Medicaid long-term-care coverage by making outright gifts to family members. The measures were passed to prevent seniors who have the means to pay for their own care from obtaining Medicaid, which is intended for poor patients. Lawyers say that if set up properly, caregiver contracts shouldn't be considered gifts to children because the patient is receiving a real service in return.

Medicaid isn't likely to "disqualify you for making those payments to your children if you have an arm's length, commercially reasonable contract, in writing, ahead of time," says Charles Sabatino, director of the American Bar Association's Commission on Law and Aging in Washington. Scott Solkoff, a Boynton Beach and Miami, Fla., elder-lawyer, says he has drafted more than 250 caregiver contracts in recent years; about half of the arrangements, he says, have been "Medicaid-driven."

Still, there's a lot of stigma to overcome when recommending the idea to families, lawyers say. The main reason: "People are still uncomfortable with the idea that you are paying your kids," says Palo Alto, Calif., lawyer Michael Gilfix.

Indeed, when Ms. Richert first heard about the contracts from her mother's lawyer, A. Frank Johns of Greensboro, N.C., "it felt funny," she says. "It's hard to put a dollar figure when you are doing something for your mom."

Advisers and family members say the deals are also smart because a formal arrangement, done ahead of time, can minimize feuds among siblings and other relatives. Oftentimes, one child serves as a primary caregiver and a parent may reward him or her by making informal gifts or by doling out a bigger piece of the estate in the will. Unfortunately, those arrangements can lead to family fights or will contests.

A formal caregiver contract, drafted ahead of time, makes the arrangement "more iron-clad," says New York elder-law attorney Bernard Krooks. "You have a written document showing this is what mom wants you to do and what mom wants to do for you. It helps avoid family squabbles." But lawyers say it's important to discuss the contract with other siblings or relatives so they are aware of the arrangement ahead of time; that can help minimize family tensions later.

Terry Huffines, of Brown Summit, N.C., set up a caregiver contract with her aunt, who is 92 years old, to help avoid any estate problems down the road with her aunt's 15 additional nieces and nephews. The agreement, set up by Mr. Johns, the Greensboro, N.C., lawyer, outlines the services Ms. Huffines, 72, will provide for her aunt, including driving her to the doctors, the grocery store and other household chores.

In order for a caregiver contract to be respected -- and to pass muster with Medicaid authorities -- it has to follow certain formalities. For one, you can't pay the caregiver an inflated rate in order to shift lots of money out of your estate. Instead, you should specify what duties the caregiver is expected to perform and then contact local home-care agencies or geriatric-care managers to establish the market value of those services in your area. Such duties can vary from preparing meals, bathing and dressing to housecleaning and chauffeuring, as well as arranging doctor's appointments and friends' visits and overseeing medications.

Cost Varies Widely

The cost of care varies widely, depending on location and the services being performed, and can range from about $15 an hour to more than $100 an hour. Some families choose to pay a discounted rate to family caregivers, which is also acceptable, lawyers say. It's also much better to set up the caregiver contract when the incapacitated adult is of sound mind, as the arrangements can become far more complicated if a person acting as power of attorney signs the contract.

The contract should also specify whether the payment will be done in one upfront lump sum based on the senior's life expectancy -- a technique often used for Medicaid-planning -- or in regular weekly or monthly payments. It's also wise to create safeguards to prevent a caregiver from taking the money and running, such as depositing paychecks into an escrow account rather than to the caregiver directly.

There are also tax consequences to consider. The compensation is considered ordinary income, so the caregiver has to pay income taxes on the payment. Also, depending on how the contract is structured, Social Security and other payroll taxes may have to be withheld.

Many lawyers say they generally only set up the contracts as part of more-comprehensive estate plans, including power-of-attorney documents and wills, but that the arrangements can cost anywhere from about $500 to several thousand dollars to create.

It's smart to check whether there are other sources of funding you can use to pay family members. Some long-term-care insurance policies, such as those that pay lump-sum "indemnity" benefits, may be used to pay family members who provide care, says Jesse Slome, executive director of the American Association for Long Term Care Insurance in Westlake Village, Calif. If you already have a policy or are considering one, see if the coverage will allow you to pay family members for their caregiving services.

In addition, some state or federal government programs provide funding to compensate family members in what is known as "consumer-directed care." For instance, a growing number of states have a "Cash & Counseling" program for Medicaid enrollees that allows participants to pay family members for their services. Contact your local agency on aging or department of social services for more information on government funding.

Write to Rachel Emma Silverman at rachel.silverman@wsj.com

Choice of Health Care 'Proxy' Often Surprising

2006-09-13T22:50:00.000-05:00

In every meeting I have with a new client, I spend a considerable amount of time explaining what a "Health Care Power of Attorney" is, what a "Living Will" is, and the difference between the two.

Many people don't realize that failing to have these documents drafted to fulfill their personal, individual wishes can result in unfortunate circumstances where an unfavored person is making life or death medical decisions for them.

For example; if one-half of an unmarried couple becomes incapacitated, the "other half" has no legal right to make medical decisions for the other. In fact, under HIPAA, they likely have no right to any medical information at all, including whether they are even at a certain location. The parent(s) of the incapacitated person will likely make all medical decisions for them, regardless of whether they have a close relationship or not.

The article below illustrates that going to the "default" of spouse or parent decisionmakers is quite often not what people want. Make sure you are taken care of how you want, and by whom you want by seeing an estate planning attorney today.

Choice of Health Care 'Proxy' Often Surprising

By Alan Mozes
HealthDay Reporter

MONDAY, Aug. 21 (HealthDay News) -- When your health declines so badly that you can no longer speak for yourself and choose your care, who should speak for you?

Ideally, experts say, that's when a legally designated health-care "proxy" would take over. But, according to a new study, the choice of a proxy is often unexpected.

For example, a full third of married individuals said they would choose someone other than their spouse as their proxy, the study found. And female relatives -- such as a mother, a sister or a daughter -- are more likely to be chosen for the role than male relations.

Regardless of who is chosen, "every competent adult should name someone as their agent for health care," said study author Dr. K. Michael Lipkin, an assistant professor of clinical preventive medicine with the department of preventive medicine in the Feinberg School of Medicine at Northwestern University in Chicago.

Otherwise known as a "durable power of attorney for health care", a proxy is a patient-selected adult -- be it relative or friend -- who acts as the decision-maker for all health concerns if and when the patient becomes incapacitated.

"It's like insurance," Lipkin added. "You hope you never need it, and it's likely that only 5 percent of the population is going to get into the kind of crazy trouble that would require it, but that's exactly the point -- it's for the unexpected."

The study was published in the August 2006 issue of the Journal of General Internal Medicine.

In most states, in lieu of a designated proxy, power over health care decisions is automatically granted to spouses or parents if an individual becomes incapacitated.

For many Americans, these "default" choices for proxy may not be the best for them.

In the study, conducted for a six-week period in 1997, Lipkin interviewed 298 adult outpatients between the ages of 19 and 96, in various states of health, all of whom were patients at the General Eye Clinic at the University of Chicago.

These men and women were asked who they would want their doctor to notify in case of an emergency and who they would choose to represent them to execute decisions and deal with doctors if they were too sick to do so themselves.

Over half of the patients also completed a 12-question interview to ascertain attitudes toward choosing a health care proxy.

Among the findings:

* 100 percent of patients could identify a single individual to be their health proxy.
* 28 percent chose someone other than their emergency contact to serve as their proxy.
* Among the 45 percent of patients who were married, one-third did not choose their spouse as their proxy.
* Female relatives were preferred over males. For example, interviewees chose daughters over sons by a margin of 3 to 1, and sisters were twice as likely to be chosen as proxies compared to brothers.
* Nine out of 10 were supportive of doctors asking their patients to choose a proxy, and almost the same number said they would do so right away if their doctor asked them at that very moment.
* However, just over one-quarter said they had ever been asked to consider naming a proxy by their doctors.
* Only 18 percent of those interviewed had a proxy at the time, and just five percent knew for sure that they had given a copy of their proxy to their physician.

Lipkin said the findings should alert physicians that patients are more than willing to discuss the issue of health care proxies and related issues.

Everyone would benefit by talking things over while the patient is healthy, rather than dealing with these potentially difficult decisions when a crisis is at hand.

"What I think the public needs to know is that there's nothing better than having a human being to use their best judgment to speak for you when you can't," said Lipkin.

Living wills are available, but, "as an instructional document, a living will can not anticipate the ever-changing flow of issues when you're in coma, or unconscious or injured, or undergoing surgery," according to Lipkin. "So, a lot of times, the instructional documents alone -- which are static and unchanging -- are misinterpreted. Patients are much better off naming a trusted loved person as their medical proxy and giving them verbal power of attorney for health care," he said.

Another expert agreed. Lis Nielsen, the program director for the Psychological Development and Integrative Science department at the U.S. National Institute on Aging in Bethesda, Md., supported Lipkin's call for a greater focus on health care proxies.

However, she sees the establishment of a health proxy as just one piece of a good advanced-care plan.

Advanced-care planning is "not a one-shot decision," Nielsen stressed. "It's certainly an important part of planning, as people are living longer. But, as the author points out, keeping the channels of communication open is the key. You have to have continuing discussions with whomever you choose to make decisions for you if you become incapacitated, since your preferences can change over time. And you also have to open up an ongoing dialogue with care providers to facilitate having your wishes attended to later in your life."

"So, appointing a healthy proxy is one part of a project that could include a conversation about advanced directives -- namely, stating what I do or don't want to happen to me -- as well as long-term assisted care options," added Nielsen. "Naming a proxy is not a decision that you make and you're done."

More information

For more on health care proxies and other advanced-care issues, head to the AARP.

SOURCES: K. Michael Lipkin, M.D., assistant professor, clinical preventive medicine, department of preventive medicine, Feinberg School of Medicine, Northwestern University, Chicago; Lis Nielsen, Ph.D., program director, Psychological Development and Integrative Science, National Institute on Aging, Bethesda, Md.; August 2006 Journal of General Internal Medicine

Copyright © 2006 ScoutNews LLC. All rights reserved.

Consumer Reports - A Nursing Home Ratings Website

2006-09-11T11:08:00.000-05:00

Consumer Reports has launched a new website called the Consumer Reports Nursing Home Quality Monitor which ranks nursing home facilities in each state.

This site included general advice on how to choose a nursing home that is a good fit for you or your loved one, and also has detailed information on which homes have been fined for violating state or federal regulations, and so forth.

Consumer Reports suggests that persons who are interested in learning more about area nursing homes contact their local Area Agency on Aging. In Ohio, call 1-866-243-5678 to find your local agency.

Note: The Ohio Long-Term Care Consumer Guide also provides information on Ohio nursing homes (data compiled by Ohio’s Office of the State Long-term Care Ombudsman. Visit thier website to compare.

Keeping the Wolves from Grandma's Door: Financial Exploitation of the Elderly

2006-09-06T09:36:00.000-05:00

One of my prior posts mentioned World Elder Abuse Awareness Day. On that day, the International Network for the Prevention of Elder Abuse (INPEA) held meetigs at the United Nations and one of the speakers was Sally Hurme, Coordinator, Outreach & Service, AARP Financial Protection.

Sally's speech focused on ways to protect the elderly from financial predators, and an essay version follows below.

June 15, 2006 was World Elder Abuse Awareness Day. You might ask, what is World Elder Abuse Awareness Day, how did it come into being, and what is its significance? The proclamation of the "Day" came about through the efforts of the International Network for the Prevention of Elder Abuse (INPEA). INPEA is a standing committee of the International Association of Gerontology with representatives from 31 countries on all continents. (FN1) INPEA asked the representatives in the various countries to develop activities to raise political and media awareness of the problem of elder abuse in their respective countries.

As we recognize in the US, awareness of elder abuse is about where child abuse was two decades ago and domestic violence was a decade ago. Federal and state dollars spent on prevention, intervention, and prosecution of elder abuse is a slim fraction of what is devoted to child abuse and domestic violence. In many other countries, elder abuse isn't on the public's radar at all. This could be caused by denial or cultural acceptance. It does not mean that elders are not abused physically, emotionally, or financially around the world. The demographics of increasing aged populations worldwide are a reality. People today are living longer worldwide -- much longer.

Only 20 years ago, it was believed that population aging was primarily a phenomenon of the industrialized nations. We know now that population aging is a global phenomenon. Mortality rates in most developing nations have declined faster than expected over the past two decades, with the result that many such nations now have life expectancies approaching, or even exceeding, those of the developed nations. By the year 2050, there will be 2 billion older persons in the world -- compared with 600 million today. In 2050, the percentage of older persons will rise to 21 percent worldwide, up from 8 percent today. Today in India there are 80 million senior citizens, more than the entire population of Britain. (FN 2).

No country can ignore these demographics and no country can ignore the fact that their elders are vulnerable to being abused. Awareness of the reality of the potentiality and actuality of abuse is imperative before countries will devote the attention and resources necessary to put in place the policy, programs and procedures that will begin address the problem. World Elder Abuse Awareness Day was an initial step to focus the attention of the international public and policy makers that elder abuse happens.

The primary international event to raise worldwide awareness of elder abuse was a symposium held at the United Nations on June 12. Representatives from eight countries, as well as Mrs. Nane Annan, the wife of the United Nations Secretary General, spoke about efforts underway to attack elder abuse. I had the privilege to be asked to focus my comments on the financial exploitation aspect of elder abuse. Around the world, and even in the US, when people think about elder abuse, if they do at all, they think of physical violence. Unquestionably, physical abuses--the ducubidi caused by neglect, the assaults on persons with dementia, the rape of nursing home residents, and the murders that go uninvestigated because to old persons are supposed to die--are an outrageous shock to the social conscience. Just as shocking is the financial abuse of older persons that is happening around the world.

While we can project the worldwide demographic bulge, universally we acknowledge that we don't know exactly how much elder abuse or financial exploitation happens. (FN 3). We do know that what is reported is only the tip of the iceberg. (FN 4). One study has estimated that there are at least 5 million financial abuse victims in the United States each year, but officials only hear of about perhaps 1 in 25 cases. (FN 5). While many people associate elder abuse with physical violence, analysis of reported abuse in the United States demonstrates that financial exploitation happens more frequently. Its emotional consequences leave as lasting scars as physical violence. (FN 6).

Across the world it is imperative that we acknowledge that financial exploitation is already happening at an alarming rate and will continue to spread. To be equipped to address this inevitably growing problem, we first need to understand how elder financial abuse happens, who are the victims, and who are the perpetrators.

The victims of exploitation deserve society's special attention and protection because they are targeted for particularly pernicious crimes directed at their financial security. Studies point to specific cracks in victims' defenses against exploitation: trust, financial naiveté, cognitive impairments, social isolation, dependency, fear, and embarrassment. (FN 7). Perhaps unique among other types of crime, there is a very real chance that the victim has no idea that she has been or is being victimized. The victim may have no awareness that anything is amiss with his finances; that a trusted person is dipping into her bank account. Or he is just not able to recognize that the person who is taking his money is a thief. (FN 8)

It is not so much the victims' vulnerabilities or weaknesses that "allow" these crimes to happen. Credit must be given to, or blame be placed on, the perpetrators. They are good at what they do! They are cunning, experienced, and professional. They rarely look like criminals. Think of them as wolves in sheep's clothing. These perpetrator wolves come in two disguises: "the strangers" and "the trusts."

The strangers -- who work hard at looking like the trusts -- are the con artists, telemarketers, tradesmen, (FN 9) like the plumbers who used the ruse that they were working for the water board in Edinburgh, Scotland, to get inside homes of older persons to steal money, (FN 10), tricksters who charged a partially-sighted 89-year old woman in Manchester, England, £100,000 to resurface her driveway, (FN 11), and hucksters promoting money-making opportunities based on any number of enticing schemes ... the list seems endless.

The US Department of Justice recently announced 565 arrests in Operation Global Con that involved 2.8 million victims with $1 billion in losses. This international enforcement operation involved authorities in the US, Canada, Costa Rica, the Netherlands, Spain, the United Kingdom, New Zealand, and Nigeria. One case involved a fraudulent investment scheme that took $6 million from more than 13,000 foreign investors and 10,000 US investors. Another scam in Venezuela and Guatemala duped Spanish-speaking Americans to pay a fee in advance for the "La Familia Gold Card", a credit card that did not exist. Another involved foreign-currency option contracts pitched by telephone to customers in the United States, Canada, and the United Kingdom. (FN 12)

The second category of perpetrators includes those even more dangerous wolves called the "trusts." They are able to accomplish their crimes because they start with a huge advantage. The victim knows them before the crime begins. They trust their predator. They may have even given birth to them. They believe them, rely on them. Their life may even depend on them. They are their family, friends, neighbor, a new sweetheart, their caregiver, minister (FN 13), financial advisor, attorney (FN 14), insurance agent (FN 15), or banker. (FN 16) They may have a legal, fiduciary, or moral responsibility to take care of the person who is their victim. They violate that trust and responsibility by taking for their own purposes the resources and dignity of the person who relied on them.

How do these family members, friends and advisors commit their exploitation? It can be outright stealing by walking away with valuables or jewelry. A caregiver can sneak a blank check out of a checkbook, or use an ATM card to cover personal expenses. (FN 17) It can be done by coercion or duress with threats that "if you don't give me your pension check, I'll beat you or put you in a nursing home." It is done by persuasion: "If you give me your house, I'll always take care of you." It's done through professed affection: "I love you more than your kids who never come see you, so buy me a new car." It's done by professed authority: In Melbourne, Australia, a man impersonating a police officer only preyed on elderly victims. In one incident he flashed a badge saying he was from the drug squad. He appeared to be speaking into a lapel microphone while he searched the man for drugs and took his money. (FN 18)

Greed may play a role when family members prevent the parent from selling a home to pay for nursing care so the property will be available for the children to inherit. It happens through dependency when a daughter won't purchase medications for her ill mother because she needs her mother's income to live on. An unemployed son may snatch his mother's pension check to support an addiction.

It's done by intentional cunning like Pren Karaqi, who complimented a recent widow on her garden and within two weeks had moved into her home, posing as a registered nurse who would take care of her. He directed her to add his name to all her accounts, wire $42,000 to a Swiss bank account, buy a $29,000 car, and change her will to leave her home to him. (FN 19)

It's done by taking advantage of social isolation or even creating isolation so the victim is shielded or separated from existing social networks. The caregiver screens calls, intercepts mail and restricts visitors to gain psychological control. It is done by locking the elder in a back room and taking control over the apartment and pension. (FN 20)

Financial abuse most frequently is the result of a relationship gone wrong, or a betrayal of trust. A family member, friend or stranger may develop a trusting relationship with the older person with the expectation that they will derive financial gains from the relationship. All too often the caring person becomes an opportunist. He or she starts out actually helping to pay the bills. But as the older person declines in mental agility, the opportunity to dip into the bank account for personal needs becomes overpowering. (FN 21) The use of legal--or purported legal--documents such as joint bank accounts, durable powers of attorney, deeds, and wills exponentially complicates detection and recovery because of the intended screen of legitimacy. The legally complicated issues of consent, undue influence, (FN 22) and capacity create a golden opportunity for success in accomplishing the exploitation. It looks legal; it's hard to detect; it's unlikely to be reported; it's complicated to unravel; it's unusual to be prosecuted if it is revealed. The trusted-but-not-to-be trusted wolves are grinning ear to ear.

The stranger wolves are grinning, too. One international scam that rakes in a billion dollars each year is the "you have won the lottery" scheme, such as the prolific El Gordo scam out of Spain or the Canadian Lottery. (FN 23) The telemarketers promise instant wealth, but before the money can be delivered, the winner must first wire out of the country thousands of dollars in so-called fees and taxes. (FN 24) There is also the advance check scheme. This money-making ploy involves a large check that the victim is told to deposit and then refund a smaller amount, keeping the difference. Of course, the check is counterfeit so instead of gaining a commission, the victim loses the total check amount. (FN 25) One alert Florida senior spotted these two plots in one scam when he received a phony $4,000 check as an advance on the taxes he supposedly needed to pay to collect his $49,000 lottery payout. (FN 26) And there is the ubiquitous "Nigerian" or "419" scam that uses forged documents purporting to come from nonexistent government agencies or companies in West Africa that promise large amounts of money if the recipient reveals a bank account number.

Unsuspecting investors, intent on making sure their money will last their life span, are tricked into investment scams that leave them destitute in their final years. It could be the long familiar Ponzi scheme with promises of high returns that are financed only by bringing in new investors to the ruse. (FN 27) Fraudulent investment opportunities in coins and stamps also target older investors around the world. In Spain, more than 350,000 pensioners of modest means lost €3.5 billion in a stamp dealing scam. They were told the investment was guaranteed and the stamps would appreciate by 6 percent a year. (FN 28) When the pyramid scam crumbled, police were called to control hundreds gathering in protest outside the company's headquarters.

Our task as elder advocates is to become even more committed through national and international cooperation to shutting down the wolves, expanding our knowledge about the wolves' ways, and sharpening our skills to blunt their claws. Their lairs may be in Spain, Canada, Nigeria, or the United States. They could be anywhere in the world on the Internet hiding behind a pseudo URL. (FN 29) They are at their best in the bedroom or living room behind closed doors so no one becomes suspicious. Their tools are kind words, wonderful promises, and fancy pieces of paper. They don't need masks because the victims know exactly who they are because they are sons and daughters. They don't need guns or leave bruises because they talk their victims into handing over the money. They don't create fear; they build on trust.

Even though there are no broken bones, the effect is devastating financially and emotionally. Not only are life savings wiped out with little time to recover financial stability, there is an enormous psychological toll. Loss of assets means loss of independence and security, resulting in being dependent on family or pubic assistance. Financial abuse isn't just about loss of money. Its ramifications go far beyond the dollars. It causes fearfulness, loss of confidence, depression, hopelessness, and suicide. (FN 30) That list is too long.

Elder advocates must continue to stress that our clients are being abused. Policy makers cannot be allowed to ignore or forget what is happening to their constituents and their family members. Resources need to be allocated; laws need to be revised; (FN 31) attention needs to be paid to fact that how we treat our elders reflects what we are as a society. World Elder Abuse Awareness Day was one step to raise international awareness of elder abuse and financial exploitation and to reinforce our universal commitment to keeping the wolves away from our parents and grandparents wherever in the world they may live.

NAELA member Sally Hurme is staff attorney with AARP Financial Protection in Washington, DC.

Notes
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FN 1 "The International Network for the Prevention of Elder Abuse aims to increase society's ability, through international collaboration, to recognize and respond to the mistreatment of older people in whatever setting it occurs, so that the latter years of life will be free from abuse, neglect and exploitation."

FN 2 Lola Nayar, Celebrating Old Age by Making a Difference in Society, April 18, 2006, INDO-ASIAN NEWS SERVICE.

FN 3 A poll taken in conjunction with World Elder Abuse Awareness Day, found that more than half of all respondents believed that there was a great deal of neglect and mistreatment of the elderly in Britain. Elderly Abuse ‘Becoming Common', BBC NEWS, June 5, 2006. One in Five Israeli Elderly are Abused, Jerusalem Post, Feb. 19, 2006.

FN 4 One invaluable source of current information about fraud, exploitation and abuse in the United States and other countries are media scans by The American Society of Adult Abuse Professionals and Survivors (ASAAPS). The US Federal Trade Commission complies reports of fraud in its Consumer Sentinel database. For an analysis of fraud and identity theft complaints from consumers over 50 to the FTC in 2004, [click the link]. In 2004 reported fraud cost people 50 and older $15 million out of the $565 million total fraud losses reported nationwide.

FN 5 John Wasik, The Fleecing of America's Elderly, CONSUMERS DIGEST (March/April 2000).

FN 6 Reports of financial exploitation investigated by US Adult Protective Services were 20.8% of all reports, compared to 12.5% for physical violence. Pamela B. Teaster et al., ABUSE OF ADULTS AGE 60+: THE 2004 SURVEY OF ADULT PROTECTIVE SERVICES (2006).

FN 7 Thomas L. Hafemeister, Financial Abuse of the Elderly in Domestic Settings, in National Research Council, ELDER MISTREATMENT: ABUSE, NEGLECT, AND EXPLOITATION IN AN AGING AMERICA, 391-393 (2004).

FN 8 AARP, TELEMARKETING FRAUD VICTIMIZATION OF OLDER AMERICANS (1996).

FN 9 George Gregg was indicted in Maricopa County, AZ, for taking $50,000 from an elderly woman for roof repair. He never did any work but collected payment several times from the 77-year Scottsdale resident. Handyman Scams Targeting Elderly, KPHO PHOENIX, May 10, 2005. The president of a Japanese home repair company was arrested for possibly defrauding 800 older homeowners into doing 1 billion yen in unnecessary home repairs. 7 Home Repair Staffers Arrested, YORMIURI SHIMBUN, June 13, 2006.

FN 10 Plumbers, who claimed they needed access to the home to check taps and pipes, preyed on at least 14 elderly and vulnerable victims stealing thousands of pounds. Alan Roden, Bogus Callers Swoop on OAPs, The Trail of the Con Men, May 16, 2006, EDINBURGH EVENING NEWS.

FN 11 Plumbers, who claimed they needed access to the home to check taps and pipes, preyed on at least 14 elderly and vulnerable victims stealing thousands of pounds. Alan Roden, Bogus Callers Swoop on OAPs, The Trail of the Con Men, May 16, 2006, EDINBURGH EVENING NEWS.

FN 12 U.S. Department of Justice, Hundreds Arrested in Operation Global Con, May 23, 2006.

FN 13 Bradley Guy Miller knocked on the doors of elderly residents asking for money to help the homeless and victims of domestic violence, telling the people that he was a worker for a non-profit religious group. He altered $5 donation checks for the needy into $50 checks for himself, making $70 to $100 per day. Senta Scarborough, Police: Mesa Man Bilked Seniors in Charity Scam, ARIZONA REPUBLIC, June 1, 2005.

FN 14 A New Jersey attorney admitted bilking a 90-year-old client out of her home and life savings by drafting a power of attorney for her two "new friends" and helping them sell her home. Michelangelo Conte, Slap on the Wrist for Scam Attorney, JERSEY JOURNAL, July 9, 2005. Christchurch, New Zealand, solicitor stole $700,000 from elderly client using an enduring power of attorney. Dean Calcott, Four years jail for breach of trust, April 6, 2006.

FN 15 An insurance salesman made cash withdrawals and took out loans against life insurance policies he had sold to elderly clients. He also diverted premium payments for his own use. Former KC man gets one year for fraud, KANSAS CITY BUSINESS JOURNAL, May 17, 2006.

FN 16 Owens v. Mazzei, 1743 EDA 2003, 2004 Pa. Super. 106 (April 7, 2004) (bank employees and bank civilly liable for using undue influence to persuade 82-year-old customer to name branch manager and assistant manager as beneficiaries of a pay on death account and consolidate all other accounts and deposits totaling over $600,000).

FN 17 Travis Lau, Caregiver Allegedly Stole Woman's Credit Cards, EVENING SUN, April 9, 2005.

FN 18 Shelley Hodgson, Fake Cop Sent to Jail, HERALD SUN NEWS, May 13, 2006.

FN 19 Man Accused of Stealing $200,000 from Elderly Woman, CLICKONDETROIT.COM, July 1, 2005. In Connecticut Lynda Gardner befriended 77-year old women and began running errands for her. Gardner drained the victim's savings, checking and life insurance accounts, forged 65 checks and used the woman's PIN to access accounts at least 76 times, totaling $236,000. Tracy Kennedy, Mother and Son Plead Not Guilty to Fraud Charges, REGISTERCITIZEN.COM, April 27, 2005.

FN 20 Hurme, Perspectives on Elder Abuse (2002).

FN 21 Ronald Block was once a true friend, who spent years keeping Norman Roussey's accounts straight and his house clean until, tempted by Roussey's impaired mental state and bulging bank account, he finally gave in and plundered his friend's finances. Jason Dearen, Friendly Fraud: The Closest Person in His Life Took almost Everything He Had, INSIDE BAY AREA, April 11, 2005.

FN 22 San Diego prosecution team was successful in overcoming the defense that the victim willingly gave away by proving that the victim's consent had been stripped away by undue influence. Judy Campbell, Elder-abuse Prosecution Guru Sheds Light on Crimes, INSIDE BAY AREA, April 11, 2005.

FN 23 Binational Working Group on Cross-Boarder Mass-Marketing Fraud, Mass-Marketing Fraud; Report to the Attorney General of the United States and the Solicitor General of Canada (May 2003).

FN 24 An older woman was told that to win the "International Lotto" she had to wire $2,448 to cover "insurance fees." When she resisted she was threaten with legal action if she did not forward the money to claim her prize. Bryce Mursch, Elderly Graniteville Woman Victim of Lottery Scam, WISTV, Columbia SC, May 17, 2006.

FN 25 Caroline Mayer, Banks Honor Bogus Checks and Scam Victims Pay, Washington Post, June 1, 2006,

FN 26 Senior Citizen, Son Hunts Down Scammers, WPBFNEWS.COM, June 23, 2005.

FN 27 South Florida insurance agents were arrested for convincing clients to liquidate annuities to invest in a bogus company that would buy and sell distressed real estate with returns of up to 9 percent. No real estate was purchased, but phony investor statements were sent until the scheme collapsed. DFS Arrests Two S. Fla. Agents in $1.2 M Ponzi Scheme, INSURANCE JOURNAL, May 17, 2005. Gladys Meija, a 70-year-old restaurateur who would prefer to be retired, gave a frequent customer $50,000 to invest because he guaranteed 5 to 6 percent return so she could retire. The scheme collapsed and she now works two jobs to pay her bills. Penne Usher, Local Senior Victimized in Investment Fraud, AUBURN JOURNAL, July 8, 2005.

FN 28 Elizabeth Nash, Pensioners Fight to Recover Savings After Scam, THE INDEPENDENT, May 11, 2006. Fourteen older New York investors lost more than $1 million to a confidence scheme to sell rare coins that -- they were promised -- would be repurchased at a 20 percent premium in a year. Robert E. Kessler, Three Charged in Rare Coin Scheme, Newsday, January 21, 2005.

FN 29 More than 1 million consumers have been tricked into divulging their personal information to senders of phishing emails, with industry losses totaling nearly $1 billion. Bob Sullivan, ID Theft Concerns Grow, Tools Lacking, MSNBC.COM, June 23, 2005.

FN 30 Hafemeister, supra note 7, at 391-392.

FN 31 Congress is currently considering the Elder Justice Act (S. 2010). Its passage would provide a much needed federal focus point, and potential resources, to address elder abuse. NAELA is a member of the Elder Justice Coalition supporting passage of the EJA.

Is a Durable Power of Attorney a "License to Steal"?

2006-06-27T10:44:00.000-05:00

A June 5, 2006 BusinessWeek article discusses whether a Durable Power of Attorney is a "License to Steal" from seniors.

In that case, an 87 year old woman had named her son as her attorney-in-fact and a few years later, a few hundred thousand of her hard-earned dollars were now in her son's account - without her permission! The son had "a license to steal", and he used it!

Apparently, "80,000 such cases were reported last year, and more than two-thirds of the victims were defrauded by someone close to them." This is frightening news. What can be done to avoid such situations?

The article suggests that "it's best to start planning before a senior becomes unable to manage the finances. Document in writing such issues as who will have durable power of attorney, who will oversee the accounting of the finances, and what needs to be done if a problem arises. Too often these questions are confronted in times of crisis, and by then it may be too late." Your elder law attorney can help facilitate this entire process to take the stress off you or your loved one.

BusinessWeek suggests: "To prevent such abuse, hire a lawyer to customize the document, recommends Loewy. Make sure it explicitly states what bills and other financial transactions you want the agent to handle. Some states allow agents to make financial gifts to themselves without limit or restriction. Carefully review or delete these clauses.

Insist that the agent not commingle his or her own funds with those of the person granting power of attorney. It makes it easier to monitor the finances. Another safeguard is to notify the bank of any monthly bills to be paid by the agent with power of attorney. Have the bank agree to to alert another family member if there is an attempt to withdraw additional funds.

Even a well-drafted power of attorney is not foolproof. To add additional protection, assign a third-party, preferably a lawyer or other nonfamily member, to review all spending and monthly financial statements."

World Elder Abuse Awareness Day

2006-06-16T14:21:00.000-05:00

Today was the first "World Elder Abuse Awareness Day", launched at UN Headquarters in New York City, which calls for people to wear something purple to show support. This day was established by the INPEA (International Network for the Prevention of Elder Abuse), which is a standing committee of the International Association of Gerontology (IAG).

According to the INPEA, "[t]he key objective of World Elder Abuse Awareness Day (WEAAD) is to raise awareness
of elder abuse (which encompasses neglect and mal- or mistreatment) throughout the
world."

The main message that this organization is trying to promote is to never ignore elder abuse, and they also want to point out that 1) Most elder abuse is hidden; 2) Ageism (age discrimination) is a major cause of elder abuse; 3)Ageism and disempowerment lead to elder abuse being hidden; and 4) Empowering older persons is the most effective tool in the response
to elder abuse.

This day, at the very least, should remind us all that elder abuse happens. It is best to keep an eye out for warning signs and not simply look the other way. See if your community has an elder abuse hotline or other was for you to help anonymously.

Ethical Wills

2006-06-12T08:36:00.000-05:00

What in the world is an Ethical Will? You've heard about wills, living wills, and even "Good Will Hunting". An ethical Will is a different animal altogether.

A theme that you'll see in this blog is that estate planning is really about your family, the ones you love. It's not just about how much tax you can save, or how much more money you can pass along by planning. Most important is the impact of all of this on your little girl, or that person who has always been there for you.

In the March 2006 issue of Money Magazine, an article entitled "Leave a Legacy, Live Forever" discussed Ethical Wills.

The article states that more and more Americans are "making sure the money they leave behind does more than pad their progeny's bank accounts."

A traditional will tells the world what you want particular people to have. Billy gets your stock, Bobby gets your art, etc. An Ethical Will tells these people what you want them to know. It can be a personal history, stories, messages about what values you wish them to live by, or anything you wish it to be.

Rather than your grandchildren knowing they will be able to buy a car when they are 16 thanks to the money "PaPa" passed to them, they'll be able to take a spin in that car and read a handwritten note that you created 10 years earlier that tells the story of how you drove a Willy's Jeep in Europe during WWII, and how you hope they will always remember to be humble and thankful for their family, because it was the only thing that kept you going during those tough days. Maybe they'll even buy a Jeep in your honor, to remember you every time they turn the key.

An Ethical Will is something that should be used more than it is. I offer to assist my clients in creating their own, personalized Ethical Will. Why? Because your expression of who you are, what you lived for, and what you believed in will last far longer than the money you pass on - regardless of how many commas are in the figure. You can indeed live forever.

Welcome

2006-06-12T08:26:00.000-05:00

Welcome to the Elder Law and Estate Planning blog.

The purpose of this blog is to discuss issues facing the aging American population and thier loved ones, and hopefully to have a little fun along the way.

If you've reached this page and have a question, please feel free to leave it in a comment, or email me at russ@golowinlegal.com. For information on Ohio Medicaid Planning, Pet Trusts, Special Needs Trusts, Probate, Estate Planning, or Asset Protection, please visit Golowin Legal, LLC.