After graduating from college, and even law school, the thought of drafting your estate plan probably did not make the top twenty on your “to-do” list, and why should it? The only thing most young professionals have when they first start out is debt. However, after you land your first job, preparing your estate plan needs to move quickly to the top of that elusive “to do” list. It’s especially important if you are starting a family. Below are five documents that should be part of your estate plan.
1. Durable Financial Power of Attorney. A Durable Financial Power of Attorney is a document whereby you name an agent to act on your behalf concerning your personal financial affairs. Typically, your agent would step into this role only if you were unable to handle your own affairs; e.g., if you were in a serious accident or were extremely ill. Your agent can be a family member, a close friend whom you trust, or even a private fiduciary. The Power of Attorney gives your agent a wide range of duties and responsibilities that should be tailored to your own situation. Some of the responsibilities of your agent might include paying your bills, caring for your home, and even handling disputes on your behalf with the Motor Vehicle Division or the Social Security office. This is one of those documents that you do not need . . . until you do. If you do not have a Durable Financial Power of Attorney in place, and you are unable to make your own decisions, your family members may have to petition the Court to appoint a Conservator on your behalf, which can often be time-consuming, involve delays, and is expensive.
2. Health Care Power of Attorney. A Health Care Power of Attorney is similar to the Durable Financial Power of Attorney, except it is used for decisions concerning your health care. Again, you will name an agent who will have the authority to make health care decisions for you, if you are unable to make them for yourself. Your named agent can assist with placement, if you must be moved to a rehabilitation facility, and is often given the ultimate authority to follow your wishes regarding life-sustaining treatment, if you were in a terminal situation.
It is important to contact an estate planning attorney to draft this document, due to changes in the laws over the past several years such as decisions on the disposition of your body (i.e. burial vs. cremation). Also, a properly drafted Health Care Power of Attorney is necessary if your physician has determined that, due to your deteriorating mental condition, you must be placed in a Level One Behavioral Health Facility. Without a Health Care Power of Attorney containing certain language, such Facilities will require that a Guardian be appointed to act on your behalf.
3. Last Will and Testament. A Will allows you to provide, with a great deal of specificity, to whom and in what manner your assets will be distributed upon your death. A Will is much more simple than a trust. There are many options to consider when preparing the provisions in your Will, for example: Who will receive your personal property, what will happen to your house, who will serve as guardian for your minor children, and who will be responsible for paying your final expenses? While it may seem overwhelming at first, once you have addressed these questions, and have properly executed your documents, you will be relieved that you have made the task of distributing your property significantly simpler.
Depending on your estate and goals, a Revocable Living Trust may also be an option to consider. Even if you decide to create a Trust, it is still important to execute a Will. If you have a Trust, the sole beneficiary of your Will is likely to be the Trustee of this Trust.
4. Beneficiary Designation. If that first new job that you landed came with a 401(K) or an IRA program, make sure that you contact your Financial Advisor to ensure there is a current beneficiary designation for you on the account. A Beneficiary Designation states that upon your death, the assets held in that account pass immediately to the named individual(s). Typically the individual(s) will have to provide the custodian of the account with a death certificate and complete forms required of a beneficiary. If you do not have a beneficiary designation on the account at the time of your death, the funds will be distributed as part of your estate. Under IRS regulations an estate cannot be a beneficiary, therefore, if this occurs, the funds in the account must be distributed over five years, which is disadvantageous from an income tax standpoint. Speak with your estate planning attorney to determine if having a Beneficiary Designation fits with your overall estate plan.
5. Beneficiary Deed. A Beneficiary Deed allows you to name an individual who will receive your interest in real property at your death. Chances are, if you are married, you hold title to your home as community property with right of survivorship or joint tenants with right of survivorship. If that is the case, a Beneficiary Deed would only be used at the death of the second spouse. However, if you are the sole owner of a home, and again, all of your assets will be distributable to one or two individuals, such as your significant other or your parents, a Beneficiary Deed will allow for a smooth transfer without subjecting your property to a probate proceeding. There are times when use of a Beneficiary Deed might not be in your best interest, e.g., if you wish the property to be distributed to minor children.
After the necessary documents are executed, be certain that one set of originals is placed in a safe or safe deposit box in your bank and let your family know that the documents are there. It is wise to re visit these documents when a major life event occurs, such as a wedding, a birth or even a death, to ensure no changes to your documents should be made. If no major life events occur, it is always a good idea to contact your estate planning attorney every five years to ensure there have been no substantive changes in the laws that may affect your documents. The above information is based on the laws of the State of Arizona.
“Planning is bringing the future into the present so that you can do something about it now.”
– Alan Lakein, author of How to Get Control of Your Time and Your Life
Copyright © 2015 Ryley Carlock & Applewhite. A Professional Association. All Rights Reserved.
By Dr. Katie Eastman, William Lightfoot and Elizabeth Hamilton-Guarino
From : Best Ever You
Former Sargeant, Bill Lightfoot, was a recent guest on The Best Ever You Show. Bill served with the Richmond Police Department for thirty-six years. He has served as an investigator and supervisor with the Property Crimes Unit, the Robbery & Homicide Division, The Narcotics Division, and the Criminal Intelligence Unit.
The show with Bill focused on caring for the elderly, elder abuse and ways we can be more mindful now to prevent or lessen issues later. To listen to the show Elizabeth and Katie hosted with guest Bill Lightfoot, click blog talk radio
The show prompted us to write these:
25 Best Questions to Ask Your Aging Parents.
1. What is most important to you about your aging?
2. If there is one thing you want to ensure happens when you are older, what would it be?
3. What are your three most important values? How do they relate to health, money and aging?
4. Have you thought about who best understands you and your values to make decisions on your behalf?
5. Do you have a certain idea/belief that you want to direct these decisions?
6. When you think about becoming medically challenged, what do you want others to know or to do or not do?
7. Do you imagine yourself living a certain way if you have future health challenges?
8. Do you have a living will or an advanced directive? (or Medical Power of Attorney)
9. Do you know someone who would best be able to make medical decisions on your behalf? Have you spoken with this person?
10. Do you know someone who would best be able to make financial decisions on your behalf? Do you have a legal Power of Attorney? Have you talked with this person?
11..Do you have a will?
12. Where do you imagine yourself living for the remainder of your life?
13.. Have you prepared yourself financially to support your aging medical needs?
14.. Is there an assisted living/nursing facility you would consider if it becomes necessary? Have you investigated different care facilities for quality/cost/needs?
15.. Do you have Long Term Health Insurance?
16.. Is there a friend/family member you would like to be closer to in proximity? What would this require if they are not close?
17. When did you last update your documents? Do you feel the need to update your documents? (Many fail to do this once they have a document in place.)
18. Have you discussed any of these decisions with anyone else? If so, who?
19. Do you have legal representation?
20. Do you have spiritual/religious beliefs and or a representative or organization in your life?
21. Is there any information/ documentation available somewhere (safety deposit box etc.) that may be needed to care for you?
22. Do you own objects that are sentimental and most valuable to you? Do you have them listed in a document/are they a part of a will?
23. What else about your aging is important to you?
24. Have I missed anything?
25. How can I show you the most love and support as you age?
More important than any question you could ever ask is to show love and compassion for the elderly.
Dr. Katie Eastman, Bill Lightfoot and Elizabeth Hamilton-Guarino
Dr. Katie Eastman
Katie is the Founder of Children’s Palliative Care Community. Mentored by Dr. Elisabeth Kubler-Ross, Dr. Eastman has dedicated her career to improving the quality of life for seriously ill and dying children and those who care for them. She has a Doctorate in child psychology and a Masters degree in medical social work. In addition, she has studied and lectured extensively topics related to grief and loss, pastoral psychology, thanatology and all aspects of pediatric palliative care.
Katie serves as a Chief Advisor on The Best Ever You Network and is the co-host of The Best Ever You Show on Blog Talk Radio.
Bill served with the Richmond Police Department for thirty-six years. He has served as an investigator and supervisor with the Property Crimes Unit, the Robbery & Homicide Division, The Narcotics Division, and the Criminal Intelligence Unit.Bill served with the Richmond Police Department for thirty-six years. He has served as an investigator and supervisor with the Property Crimes Unit, the Robbery & Homicide Division, The Narcotics Division, and the Criminal Intelligence Unit.
Elizabeth is the Founder and CEO of The Best Ever You Network and host of the top-rated blog talk radio program, The Best Ever You Show. Her father, James Hamilton is a stroke survivor since 2004 and a kidney cancer survivor since 2011.
Elizabeth was resuscitated in 1998 from an allergic reaction.
- Gifts to persons (caregivers, service providers, friends) who are not the natural objects of the client’s bounty
- Gifts to anyone that are so large, given the size and nature of the client’s estate, as to threaten the client’s economic security
- Loans, particularly if undocumented, to anyone; special scrutiny required if to non‑family members
- Actions by client’s fiduciary (attorney-in-fact, trustee, other) that reflect poor judgment or conflict of interest
- Existence of estate-planning documents naming non‑family members as fiduciaries or beneficiaries
- Existence of joint accounts with non‑family members
- Evidence that client signs checks prepared by others
- Bequest plans or other arrangements favoring one child, particularly if a caregiver
- Evidence of physical harm (bruises, cuts, etc.)
- Evidence of excessive dependence on a child or other person, particularly if such other person is critical to the client’s independence and/or ability to avoid a nursing home
- Material inconsistency between client’s understanding of estate and its true value
- Excessive fees charged by professionals (trustees, attorneys, financial advisors, stockbrokers, other)
- Unconscionable terms of loans or other financial arrangements.
Courses of Action When Elder Abuse Identified :
- Require accountings from prior fiduciaries. Court procedures are available to compel such accountings.
- Institute conservatorship/guardianship procedures to formalize authority in a third party who will be accountable to the courts.
- Contact Adult Protective Services (or its equivalent) in the client’s community. [Caveat: Doing so may constitute a breach of confidentiality.]
- Revoke or amend estate-planning documents that do not comport with client’s wishes.
- Commence civil action against person(s) who take financial advantage of client. Such actions may include elder abuse (in jurisdictions so providing), fraud, negligence,
misrepresentation, theft and breach of contract.
- Commence civil action against person(s) who physically abused the client. Such actions may include elder abuse, assault, battery, wrongful death and violation of Patient Bill of Rights (if events occurred in a nursing home).
- Remove assets from accounts held jointly with suspected abuser.
- Involve the police and raise possible criminal charges against abuser.
- Draft documents (durable power of attorney, trust, other) to effect true, independent wishes of client.
- Involve social worker, counselor, psychologist or professional geriatric care manager.
- Involve professional, bonded fiduciary to manage assets for client.
- Wealth is not a Barrier to Abuse and Exploitation – it’s an Invitation (larkkirkwood.wordpress.com)
- Elder Abuse & Financial Crimes: What’s it all about? (larkkirkwood.wordpress.com)
- Appalling information about Missouri & Elder Abuse! (larkkirkwood.wordpress.com)
- National Organization to Stop Elder Abuse and Guardianship Abuse (larkkirkwood.wordpress.com)
- Seniors and Conservatorship – helping you understand. (larkkirkwood.wordpress.com)
- The 5 Senses of Abuse (larkkirkwood.wordpress.com)