Who Will Make Your End-Of-Life Decisions When You Are Incapacitated?

December 28, 2010

Filed under: Estate Planning,Medical Care — Tags: — Alexis @ 11:10 AM

As we get older, the threat of illness or injury increases, and many of us wonder what will happen if we fall or get injured.  Who will make important healthcare decisions if we become incapacitated?  How will medical personnel know how to treat us if we cannot communicate with them?  The answer to all of these questions is: Healthcare Agents.

A healthcare agent is the person you name in your Health Care Proxy to make medical decisions for you when you cannot make them for yourself.  This person will talk to doctors, manage your medical care, authorize treatment, and possibly even make life and death decisions.  Knowing all this, it is important to choose someone who thinks clearly under pressure, is not intimidated with medical problems, and who will keep the medical staff in check.  But beyond choosing the right person, it is essential to discuss your wishes with your agent ahead of time.

Executing a healthcare directive and nominating a healthcare agent is not just about choosing the right person to make the big life-and-death decisions for you, it’s also about taking care of the loved ones you leave behind.  Most people have strong wishes about life-support and end-of-life care, but rarely do they want those wishes carried out at the expense of their loved ones.  Creating a healthcare directive which outlines those wishes—and discussing those wishes with your agent and your family—is important not only for your own peace of mind, but also to ensure the peace of mind of your loved ones, those who will be left to mourn your absence after you’re gone.  As a health care directive, I give each client the “Your Way” workbook.

And if you don’t name an agent in a Health Care Proxy?  Your family will be forced to go to court and spend thousands of dollars pursuing a guardianship.

Can A Trust Benefit Your Family?

December 15, 2010

Filed under: Estate Planning — Tags: , , — Alexis @ 9:04 AM

Most Americans don’t realize that they have an estate.  Most people think that an “estate” includes a mansion in the hills, a private jet, or millions of dollars in investment accounts.  But the true definition of “estate” is a person’s possessions or property—regardless of the size or amount.  Everybody has an estate; and if you own a home, have a retirement account, or have any personal property of value you should consider creating a trust for your “estate.”

Before you scoff that you aren’t wealthy enough to need a trust, consider that there are many different kinds of trusts, each of which may be used for specific situations.  Some trusts are complicated and extensive, created by wealthy families to preserve assets through generations.  Other trusts are simple and to the point, created by young parents to ensure that their minor children will be provided for.  What kind you will need will depend on a number of factors, including the size of your estate, your goals for that estate, the age of your children, your marital status, whether you have a special needs child or grandchild, and many, many more.

Most trusts created for estate planning purposes are revocable living trusts (or RLTs).  An RLT is a document created not simply to distribute your property, but to own your property during your lifetime, to be invested and spent for your benefit or the benefit of your named beneficiaries.  As such, a trust takes effect as soon as you sign it, and your property is protected by it, as soon as you place your assets in the name of your trust.  There is a lot of flexibility available with a revocable living trust, and yours can be created to fit your unique situation.  Most RLTs name the trust creator (you) as the initial trustee, nominating individuals or banks to take over as trustee when you become incapacitated or pass away.

One of the primary benefits of a trust is that when you pass away, property is not merely distributed and that’s the end of it; you can instruct the trustee to distribute the money slowly and in any number of ways, for example, keeping it out of the hands of a spendthrift child or protecting it for the benefit of a special needs child.

You may not have a Back Bay penthouse or an Italian villa, but you do have a family to protect.  We’d like to help.  Contact our office to find out if your family needs a trust.

Frontal Lobe: Last In, First Out

December 8, 2010

Filed under: Alzheimer's — Tags: — Alexis @ 9:06 AM

The frontal lobe of the brain is responsible for impulse control, decision-making, planning out tasks, and the like. It doesn’t fully develop until we are in our 20’s. Essentially, it is the last part of our brain to mature. If you recall the questionable decisions you made in your teens and college years, you will most likely agree.

Are you caring for someone with dementia? Decreasing ability to control impulses, make decisions, and plan tasks – sound familiar? Many dementias attack the frontal lobe. Interesting, isn’t it?

Looking at Continuing Care Retirement Communities? Look Closely.

December 3, 2010

There are a lot of benefits to Continuing Care Retirement Communities (CCRC’s), also called “Buy-In’s.” These are the places where you put down a substantial sum (maybe $250,000 or more) as an entrance fee, and you plan to stay there for life – they have independent apartments, various levels of assisted living, and skilled nursing (nursing home), all on campus. There is definitely something appealing about the promise of being cared for for life.

But will they really care for you for life? There are some big questions right now about the nursing home units at CCRC’s. For example, when describing the nursing home to you, a potential customer, the sales staff will explain that if you run out of money, they will help you apply for Medicaid. Well, as it turns out, sometimes the CCRC makes you spend down even further than the Medicaid rules do.

For example, for a married couple, if one spouse needs nursing home but the other is still in the community (ex. in her own apartment or in the assisted living), MassHealth rules permit the community spouse to keep about $110,000 to live on. But guess what – before letting the husband move into a MassHealth nursing home bed, the CCRC might make the wife spend her own money down even further than the $110,000, maybe allowing her to keep only $50,000 for herself. And what did they have her spend it on? The husband’s private pay bed in the CCRC nursing home. And how much longer can she last in the community with only $50,000 to her name?

The sales team might also tell you that if a couple really runs out of money, there is a benevolent fund that will help you pay your monthly fees. I’d be a lot more comfortable moving into a CCRC if I saw the balance sheet for that benevolent fund – is there really enough in it for all the residents who might need help? And do they ever really expend from the benevolent fund?

Before committing to a CCRC, do your research. Dig around to make sure that what the sales staff is telling you is true. Two sources of hands-on experience with the nursing home units are going to be (1) local families who have been through the nursing home, and (2) local elder law attorneys who have helped clients navigate the CCRC nursing home experience.

4 Essential Qualities Your Executor Should Have

December 1, 2010

Filed under: Estate Planning — Tags: , , — Alexis @ 9:44 AM

If you have a Will, you have an executor. You are placing a lot of trust in your executor. After all, this is the person who will be serving in your stead when you pass away—helping your loved ones, overseeing your finances, paying your final bills and distributing your property. Serving as someone’s executor can be a tough job, and choosing the right person for that job can be just as difficult.

Although it is commonly considered an honor, serving as an executor is a lot of work, and often requires a great capacity for organization, attention to detail, meeting deadlines, and more. You may be tempted to name your favorite sibling or eldest child just to keep from hurting any feelings, but your family and heirs will not be well served if you choose your executor based on emotion rather than ability.

Keeping this in mind, here are four qualities to consider when choosing who will serve as your executor:

1. Is the person trustworthy? Your executor will be privy to all of your financial secrets: reviewing estate assets, determining your liabilities and paying off creditors, settling outstanding debts, and making distributions to heirs. Chances are you don’t want all that information spread throughout the family or community.
2. Is this person organized? The person you choose will be in charge of a number of detailed tasks, both large and small. He or she will be making lists of assets, meeting court deadlines, making timely distributions for estate taxes, and more. Missing or being late for one of these many steps can draw out the entire process, costing your heirs both time and money.
3. Is this person financially savvy? One of the responsibilities of executor is to keep the estate viable (making sure the mortgage and fees continue to be paid) during the probate process. If you have investment accounts you’ll want to ensure they won’t languish and lose their value before they can be distributed to your heirs.
4. Is this person compassionate? Although probate can be a difficult and detailed process, it is at its core about the people you love. Your executor should have the ability to be caring and compassionate during this emotional time.

Part of the estate planning attorneys’ job is to help you think through who among your family or friends would be best suited for the job. If you have any questions at all about who to name, make sure to bring it up with your attorney.