Fong Law Group

What You Need to Know About Medicaid’s Personal Needs Allowance

Seniors who rely on Medicaid and live in nursing homes receive a personal needs allowance — a monthly stipend the Medicaid recipient can use to pay for needs that Medicaid does not cover. Medicaid restricts the amount of the allowance and how it is used. If recipients do not use all the money they received in a month, they may risk losing their coverage.

What Can I Buy with My Personal Needs Allowance?

The items a Medicaid recipient can buy with their personal needs allowance are limited to things that Medicaid does not cover. A recipient can buy vitamins, hair care, snacks, clothing, and other personal-use items. However, since the nursing home facility is required to cover toiletries, the personal needs allowance generally cannot be spent on those types of items.

How Much Money Do I Get for My Personal Needs Allowance?

The Medicaid personal needs allowance has not adjusted for inflation for more than 30 years. In the 1980s, the federal government increased the Medicaid personal needs allowance to a minimum of $30 per month, which has not increased since. The monthly amount Medicaid recipients receive for their expenses varies from state to state. For example, in California, Medicaid recipients get $35 per month while senior citizens in Alaska receive $200 per month.

Am I Allowed to Manage My Personal Needs Allowance Funds?

The recipient may manage their funds. Those who are unable to manage their own money can have a guardian or the nursing home take charge of their personal needs allowance.

If the nursing home where the recipient resides manages their personal needs allowance, the facility must provide an accounting for how it spent the money. Medicaid prohibits the nursing home from using the money on anything that Medicaid provides.

Guardians can manage the recipient’s personal needs allowance on their behalf. The guardian is held to the same standards as the nursing home where the recipient resides and so must provide an accounting, usually some itemization of expenses.

What Happens If I Don’t Spend the Entire Allowance in a Month?

A recipient is not required to spend their entire allowance each month. Sometimes the money accumulates. However, recipients should be careful if they regularly do not spend all the money. Any money from the personal needs allowance a recipient does not spend is deemed an asset. Medicaid limits the value of assets that recipients are allowed to have, and if the recipient accumulates more assets than allowed, they may lose Medicaid eligibility. The Medicaid asset limit for 2022 is $2,000 in most states.

The Powers and Responsibilities of Representative Payees

Do you have a friend or loved one who receives Social Security and is unable to manage her payments? If so, you can request that the Social Security Administration (SSA), the government agency that disburses Social Security, name you as the representative payee for that person.

Being a representative payee gives you the power and the responsibility to manage that money for your friend or loved one. (The Office of Personnel Management and the Railroad Retirement Agency also appoint representative payees, and the responsibilities are basically the same.)

As a representative payee, you only have the power to handle the Social Security benefit for your friend or loved one (the beneficiary) and not any other money or property for that person unless some other document or government agency appoints you to do so. 

It is important to remember that the check from the SSA is not yours; it belongs to the beneficiary. The beneficiary is supposed to get the benefit of the money. Your role includes performing four very important duties:

1. You must act only in the beneficiary’s best interest, which means the beneficiary’s money belongs only to them. You cannot pay yourself for managing their money, and you cannot borrow it or lend it to anyone else; those would be conflicts of interest, which you must avoid. You should also do your best to make sure the beneficiary does not get scammed or mistreated.
    
2. You must manage the beneficiary’s Social Security check carefully, which means you should make sure the beneficiary’s daily needs and any other foreseeable needs are met, bills are paid on time, and all taxes are paid.
    
3. You must keep the money from the Social Security check separate from your own money, which means you cannot keep the money in any kind of joint account or sign any contracts or leases for the beneficiary. If you have to open an account or sign anything for the beneficiary, sign “(beneficiary's name) by (your name), representative payee” so everyone knows you are acting on the beneficiary’s behalf.
    
4. You must keep good records of everything you do with the beneficiary’s money, which means keeping track of all money you spend for the beneficiary and keeping all receipts. Representative payees also have to file annual reports unless they are exempt. The following types of payees are now exempt from the annual accounting requirements: 

• Natural or adoptive parents or legal guardians of a minor child beneficiary who primarily reside in the same household as the child
• Natural or adoptive parents of a disabled adult beneficiary who primarily reside in the same household with the beneficiary
• Spouse of a beneficiary

Remember, there may be other people appointed to help the same beneficiary with other things. They have the same general four duties as you, and all of you must work together if that is in the beneficiary's best interest.

If you are not a family member and the beneficiary has family, you must keep family members informed about what you are doing for the beneficiary. This will reduce the chance that they will have problems with your actions. In the end, however, the decisions about the Social Security check are yours to make because you are responsible. You are the one who will get in trouble if something goes wrong. For example, if someone thinks you violated one of your four important duties, they can report you to the SSA. The SSA will investigate, and if it decides that you misused the beneficiary's money, it will make you replace what was lost out of your own pocket.

The SSA has created a Representative Payee Portal as a central gateway for individual representative payees with a my Social Security account to conduct their own business or manage direct deposit, wage reporting, and annual reporting for their beneficiaries.

If you have more questions about what it means to be a representative payee, check out www.ssa.gov/payee.

For more information, visit the SSA’s online guide for representative payees. 

How Do I File for a Guardianship?

No one wants to see a loved one become unable to make decisions for him or herself. If this happens, however, the court may appoint a substitute decision maker, often called a "guardian," but in some states called a "conservator" or other term. A guardian is only appointed as a last resort if other, less restrictive, alternatives, such as a power of attorney, are not in place or are not working.

In most states, anyone interested in the well-being of an individual who may be incapacitated – called the “proposed ward” -- can request a guardianship for that person (also called a "conservatorship" in some states). An attorney is usually retained to file a petition for a hearing in the probate court in the proposed ward's county of residence. Protections for the proposed ward vary greatly from state to state, with some simply requiring that notice of the proceeding be provided and others requiring the proposed ward's presence at the hearing. The proposed ward is usually entitled to legal representation at the hearing, and the court will appoint an attorney if the allegedly incapacitated person cannot afford a lawyer.

At the hearing, the court attempts to determine if the proposed ward is incapacitated and, if so, to what extent the individual requires assistance. If the court determines that the proposed ward is indeed incapacitated, the court then decides if the person seeking the role of guardian will be a responsible guardian.

A guardian can be any competent adult -- the ward's spouse, another family member, a friend, a neighbor, or a professional guardian (an unrelated person who has received special training). An individual may nominate in advance the person they would like to serve as their guardian by executing a durable power of attorney while they are still competent to do so.

The guardian need not be a person at all -- it can be a non-profit agency or a public or private corporation. If a person is found to be incapacitated and a suitable guardian cannot be identified, courts in many states can appoint a public guardian, which is a publicly financed agency that serves this purpose.

In naming someone to serve as a guardian, courts give first consideration to those who play a significant role in the ward's life -- people who are both aware of and sensitive to the ward's needs and preferences. If two individuals wish to share guardianship duties, courts can name co-guardians.

Britney Spears Case Puts Renewed Focus on Guardianships and Less Restrictive Alternatives

Britney Spears’s legal fight to wrest back control over her personal and financial affairs has flooded the issue of guardianship in Klieg lights. While a full guardianship may be necessary for many individuals who are incapable of managing their own affairs due to dementia or intellectual, developmental or mental health disabilities, the Spears case underlines the option of more limited alternatives.

Every adult is assumed to be capable of making his or her own decisions unless a court determines otherwise. If an adult becomes incapable of making responsible decisions, the court will appoint a substitute decision maker, usually called a "guardian" or a "conservator," depending on the state.

Guardianship is a legal relationship between a competent adult (the "guardian") and a person who because of incapacity is no longer able to take care of his or her own affairs (the "ward"). The guardian can be authorized to make legal, financial, and health care decisions for the ward. The National Center for State Courts says that about 1.3 million adults are living under guardianships or conservatorships with some $50 billion in assets.

The standard under which a person is deemed to require a guardian differs from state to state, and because guardianships are subject to state law, data on them is hard to collect and protections against abuse vary widely.  Netflix’s popular movie, I Care a Lot, spotlighted some weaknesses in the guardianship system that make it possible for an unscrupulous guardian to take control of an elderly person’s life and bleed their resources dry. 

The Spears Case: An Unusual Situation

Britney Spears has been under a court-ordered conservatorship that has controlled her career and finances since 2008. Her father, Jamie Spears, was appointed her temporary conservator when the pop singer was allegedly struggling with mental health issues and had been hospitalized, and a Los Angeles court later made the conservatorship permanent.

On July 14, a Los Angeles judge approved the resignation of Spears’s court-appointed lawyer and granted her request to hire her own lawyer. The 39-year-old singer told the judge that she wants to end the long-running conservatorship that put her father in charge of her estimated $60 million fortune and business affairs, and others in control of such personal decisions as whether she can marry and have a baby. "I'm here to get rid of my dad and charge him with conservatorship abuse," she said.

Whatever the merits of this controversial case, what makes Spears's situation so unusual is the fact that she does not appear to be incompetent, at least when it comes to her professional accomplishments. In the 13 years since the conservatorship was put in place, she has continued her career as a pop star, earning millions from a four-year concert residency act in Las Vegas and serving as a judge on the television reality show “The X Factor.”

Another anomaly is the fact that until now Spears was represented by a court-appointed attorney who, she argued, did not represent her wishes or interests. However, while the media has given wide coverage to Spears’s side of the dispute, we have heard almost nothing from the professionals handling her affairs, who are constrained from publicly disclosing confidential information.

It’s easy to see why conservatorship, which takes away a person’s right to make decisions about significant aspects of his own life, is considered among the most restrictive legal remedies in the American judicial system. For this reason, courts are legally required to seek alternatives that will safeguard the ward’s finances and wellbeing but with the fewest restrictions, in an effort to protect that person’s rights.

Protections Without Total Loss of Control

In the case of an elderly person who may no longer be able to handle some or all of her own affairs, there are various approaches that provide protection without stripping that person of control over all decisions, as in Spears’s case.

Many people in need of help can make responsible decisions in some areas of their lives but not others (such as making major financial decisions). Families might consider setting up what’s called a “limited guardianship.” Most states allow judges to appoint guardians with limited powers that are specifically tailored to the alleged incapacitated person's needs. For example, a court can appoint a guardian to oversee a person's housing and health care, but not to manage the person's bathing, eating, and socialization. Conservators can be appointed to handle the financial affairs of someone who is not good with money, without having any power to manage health care decision making—the options are almost infinite.

Alternatives to Guardianship

Sometimes, guardianship isn't the answer at all. If a person can execute estate planning documents, she can also sign a durable power of attorney and a health care proxy, which allows someone to assist her with decisions without court involvement. "Supported decision making" is a growing alternative to guardianship in which trusted advisors like family, friends or professionals assist in making decisions, although the individual retains the ultimate right to make their own decisions.

Trying an alternative to guardianship can be important for several reasons. First, it prevents a court from ruling that someone is "incapacitated," which carries with it a stigma and can be hard to undo, as Britney Spears is finding. Second, it puts the person in the driver's seat. Third, it is much less expensive and time-consuming.

Another option is a revocable or "living" trust that can be set up to hold an older person's assets, with a relative, friend or financial institution serving as trustee. Alternatively, the older person can be a co-trustee of the trust with another individual who will take over the duties of trustee should the older person become incapacitated.

Experts say that Britney Spears faces a long, difficult path if she seeks to terminate her conservatorship. She would need to file a formal petition, which would require presenting evidence in hearings and depositions. She could face objections at every stage from attorneys representing her father and others involved in her care. (Spears has indicated her unwillingness to submit to a mental evaluation or test in her effort to end the conservatorship.)

If you have questions about what type of guardianship may be right for your family member, or if you are currently under guardianship and are looking to gain control of your affairs, talk to your elder law attorney today.

For an article on what may lie ahead in the Britney Spears case, click here.

For an article by University of Virginia Family Law Professor Naomi Cahn on how guardianships can lead to abuse, click here.

What to Do If You Are Appointed Guardian of an Older Adult

Being appointed guardian of a loved one is a serious responsibility. As guardian, you are in charge of your loved one's well-being and you have a duty to act in his or her best interest.  

If an adult becomes mentally incapacitated and is incapable of making responsible decisions, the court will appoint a substitute decision maker, often called a "guardian," but in some states called a "conservator" or other term. Guardianship is a legal relationship between a competent adult (the "guardian") and a person who because of incapacity is no longer able to take care of his or her own affairs (the "ward").

If you have been appointed guardian, the following are things you need to know:

• Read the court order. The court appoints the guardian and sets up your powers and duties. You can be authorized to make legal, financial, and health care decisions for the ward. Depending on the terms of the guardianship and state practices, you may or may not have to seek court approval for various decisions. If you aren't sure what you are allowed to do, consult with a lawyer in your state. 
• Fiduciary duty. You have what's called a "fiduciary duty” to your ward, which is an extremely high standard. You are legally required to act in the best interest of your ward at all times and manage your ward's money and property carefully. With that in mind, it is imperative that you keep your finances separate from your ward's finances. In addition, you should never use the ward's money to give (or lend) money to someone else or for someone else's benefit (or your own benefit) without approval of the court. Finally, as part of your fiduciary duty you must maintain good records of everything you receive or spend. Keep all your receipts and a detailed list of what the ward's money was spent on. 
• File reports on time. The court order should specify what reports you are required to file. The first report is usually an inventory of the ward's property. You then may have to file yearly accountings with the court detailing what you spent and received on behalf of the ward. Finally, after the ward dies or the guardianship ends, you will need to file a final accounting. 
• Consult the ward. As much as possible you should include the ward in your decision-making. Communicate what you are doing and try to determine what your ward would like done. 
• Don't limit social interaction. Guardians should not limit a ward's interaction with family and friends unless it would cause the ward substantial harm. Some states have laws in place requiring the guardian to allow the ward to communicate with loved ones. Social interaction is usually beneficial to an individual's well-being and sense of self-worth. If the ward has to move, try to keep the ward near loved ones.  

For a detailed guide from the Consumer Financial Protection Bureau on being a guardian, click here. 

Where There’s A Will, There’s a Better Future for Family

“Often people are under the misconception that a will is only necessary if a person has a lot of assets, is wealthy, or has a complicated financial planning program in place.”

The plain truth is, everyone needs a will. The value of someone’s personal property has very little to do with the need for a will or estate plan. Without one, the process of settling an estate and having heirs receive their inheritance could be delayed for many months, or even years, says the article “Where there’s a will, there is a plan in place” from The Advertiser. For wills to be legally acceptable, there are certain things that need to be included:

Identification of the person making the will, also known as the testator. The will must contain the person’s name, address, state their intention to create a distribution process for assets and the statement that this will is intended to be their last will and testament and all other wills are revoked. The will must also be dated to be sure to know hold old it is, with regard to other wills.

Outstanding debt payment. The will needs to explain how any outstanding bills will be paid, including funeral costs, medical costs, taxes owed, and any other expenses that a person may have at the time of their death. This may vary by state, so speak with a local estate planning attorney to find out what your state’s laws are.

Name any heirs and what they are being given. You may give your property to whomever you want, or to a charity. The bequest needs to be carefully written, so it is very specific and there are no misunderstandings. Since it may be hard to know what will be left after final expenses are paid, it may be wise to give percentages of assets, rather than specific figures. An estate planning attorney will know how to best handle this aspect of a will.

Chose an executor and name them in the will. The executor is responsible for carrying out the wishes of the testator and is in charge of paying debts, taxes, distributing assets and any tasks assigned in the will. Choosing the right person for this task is very important. They need to be able to handle the responsibility and be able to execute your wishes, without being bullied by family members or friends. Always name a secondary executor, in case the first predeceases you, or if the person is unable or unwilling to serve.

Name a guardian for minor children. This is why parents of young children must have a will. If there is no will, the court will determine who should raise the children, following the laws of kinship of your state. You may not agree with the court’s decision. Select a person (or couple) you believe will raise the children, as close as possible to how you would raise the children.

Plan for your funeral. This is a kindness to your loved ones. If you don’t plan in advance, your loved ones may spend more than you would wish on an elaborate funeral. The opposite may also happen. A simple paragraph may do the job, or you could visit the local funeral home and prepay, selecting everything so that it will be done according to your own wishes.

In addition to a will, you’ll want a power of attorney and health care power of attorney in place to protect you, in case of incapacity. This way, someone will be able to take care of your finances and someone else will be able to make health care decisions, if you can’t.

An estate planning attorney can work with you to make sure that all these documents are properly prepared according to your state’s laws.  They have worked with many others, know what kind of issues crop up and how to prepare for them. This is especially important with blended families or families where there are complicated histories. Think of the estate plan as a gift to your heirs, a chance to express your wishes and a way to create a legacy for your loved ones.

Reference: The Advertiser (March 10, 2019) “Where there’s a will, there is a plan in place”

Estate Planning for Parents with Young Children 給有年幼子女的父母的資產規劃 (中英對照)

“What would happen with your kids, should something happen to you? It’s a question that most parents don’t like to think about.”

Attorneys who focus their practices on estate planning, know that not every story has a happy ending. For some of them, it’s a professional mission to make sure that young parents are prepared for the unthinkable, says KTVO in the article “Family 411: Thinking about estate planning while your kids are young.”

It’s a very easy thing to forget, because it’s so unpleasant to consider. The idea of becoming seriously ill or even dying while your children are young, is every parent’s worst fear. But putting off having an estate plan with a will that prepares for this possibility is so important. Doing it will provide peace of mind, and a road forward for those who survive you, if your worst fears were to come true.

Start with a will. In a will, you’ll name a guardian, the person who would be in charge of rearing your children and have physical custody of them. Don’t assume that your parents will take over, or that your husband’s parents will. What if both sets of parents want to be the custodians? The last thing you want is for your in-laws and parents to end up in a court battle over custody of your children.

Another important document: a trust. You should have life insurance that will be the source for paying for the children’s education, including college, summer camps, after-school activities and their overall cost of living. In addition, proceeds from a life insurance policy cannot be given to a minor.

However, what if your son or daughter turned 18 and were suddenly awarded $500,000? At that age, would they know how to handle such a large sum of money? Many adults don’t. A trust allows you to give clear directions regarding how old the child must be, before receiving a set amount of money. You can also stipulate that the child must complete college before receiving funds or reach certain milestones.

An estate plan with young children in mind, must have a Power of Attorney for financial decisions and one for medical decisions. That allows a named person to make important financial and medical decisions on behalf of the child. You may not want to have their legal guardian in charge of their finances; by dividing up the responsibilities, a checks and balances system is set into place.

However, for medical decisions, it is best to have one primary person named. In that way, any care decisions in an emergency can be made swiftly.

While you are creating an estate plan with your children in mind, make sure your estate plan has the same documents for you and your spouse: Power of Attorney, medical Power of Attorney, a HIPAA release form and a living will.

Speak with a local estate planning attorney who has experience in planning for young families.

Reference: KTVO.com (Feb. 6, 2019) “Family 411: Thinking about estate planning while your kids are young”

“如果你的子女發生了什麼事，你會怎麼樣？這是大多數父母不喜歡思考的問題。”

專注於資產規劃的律師知道並非每個故事都有一個美好的結局。對於一些律師來說，確保年輕父母為不敢想像的事情做好準備是一項專業任務，KTVO在文章“Family 411: Thinking about estate planning while your kids are young.” 中說。

這是一件很容易遺忘的事，因為想這事令人不快。在子女年幼的時候，每個父母最害怕去想就是自己患重病甚至死亡。但制定資產規劃，為有可能發生的事情作出準備是非常重要的。如果你最害怕的事情成真了，那麼制定好資產規劃可以讓你高枕無憂，並為您在世的家人做好安排。

首先從遺囑說起。在遺囑中，您需指定一名監護人去負責撫養您的子女並給予實際監護權。不要以為你的父母會接管，或者你丈夫的父母會接管。如果雙方父母都想成為監護人那怎麼辦？你不會想最後是你的姻親和父母因你子女的監護權最終要鬧上法庭。

另一個重要文件：信託。你應該有人壽保險，作為支付子女教育費用的來源，包括大學，夏令營，課後活動和他們的生活費。此外，人壽保單的收益不能給予未成年人。

但是，如果你的兒子或女兒年滿18歲並突然獲得50萬美元，該怎麼辦？在那個年紀，他們會知道如何處理這麼大一筆錢嗎？許多成年人都不會。信託允許您明確地說明子女需達到某年齡才能獲得該筆錢。您還可以規定子女必須完成大學後方可獲得該筆錢或達到某些里程碑。

資產計劃還考慮到年輕子女，必須有財務授權書和醫療授權書。這可指定某人代表子女做出重要的財務和醫療決定。你可能不想讓他們的法定監護人負責他們的財務; 通過劃分責任，可以讓他們互相監督。

但是，對於醫療決定，最好是指定一位為主要決定人。這樣，可以在緊急情況下迅速地作出醫療決定。

在您為孩子製定資產規劃時，請確保您跟您的配偶的資產規劃也有同樣的文件：財務授權書，醫療授權書，HIPAA放行表和遺囑。

具有規劃年輕家庭經驗的資產規劃律師交談, 會令您獲益良多。

參考: KTVO.com (Feb. 6, 2019) “Family 411: Thinking about estate planning while your kids are young”

Spare Your Family From a Feud: Make Sure You Have a Will

“If you die without a will, it can lead to conflict between your surviving loved ones, as they try to figure out how best to divide up your personal belongings and finances.”

If for no other reason than to avoid fracturing the family, as they squabble over who gets Aunt Nina’s sideboard or Uncle Bruno’s collection of baseball cards, everyone needs a will. It is true that having an estate plan created does require us to consider what we want to happen after we have died, which most of us would rather not think about.

However, whether we want to think about it or not, having an estate plan in place, and that includes a will, is a gift of peace we give to our loved ones and ourselves. It’s peace of mind that our family is being told exactly what we want them to do after we pass, and peace of mind to ourselves that we’ve put our plan into place.

A recent article from Fatherly, “How to Write a Will: 8 Tips Every Parent Needs to Know,” starts with the basic premise that a will prevents family squabbles. Families fight, when they don’t have clear direction of what the deceased wanted. That’s just one reason to have a last will and testament. However, there are other reasons.

A will is one way to ensure that your property is eventually distributed as you wish. Without a will, your estate is administered as an “intestate estate,” which means the state’s laws will determine who receives your assets after you pass. In some states, that means your spouse gets half of your estate, with your parents getting the rest (if there are no children). If the parents have died and there are no children, the rest of the estate may go to your siblings.

Most people—some studies say as many as 60% of Americans—don’t have a will. It’s hard to say why they don’t: maybe they don’t want to accept their own mortality, maybe they don’t understand what will happen when they die without a will, or perhaps they want to wreak havoc on their families. However, having a will is essential.

Don’t delay. If you don’t have a will in place, stop putting it off. Creating a will gives you the opportunity to effectuate your wishes, not that of the state. What if you don’t want your long-lost brother showing up just to receive a portion of your estate? If you don’t want someone to receive any of your assets, you need to have a will. Otherwise, there’s no way to know how the distribution will play out.

Be thoughtful about how you distribute your assets. If you have children and your will gives them your assets when they reach 18, will they be prepared to manage without blowing their inheritance in a month? A qualified estate planning attorney will be able to help you create a plan for distributing your wealth to children or other heirs in a sequence that will match their financial abilities. You may want to create a trust that will hold the assets, with a trustee who can ensure that assets are distributed in a wise and timely manner.

Every family is different, and today’s families, which often include children from prior marriages, require special planning. If you have remarried and have not legally adopted your spouse’s children from a previous marriage, they are not your legal heirs. If you want to make sure they inherit money or a specific asset, you’ll need to state that clearly in your will. If you are not married to your partner, they will not have any rights to your estate, unless a will is created that directs the assets you want them to inherit.

Parents of young children absolutely need a will. If you do not, and both parents pass away at the same time, their future will be determined by the court. They could end up in foster care, while awaiting a court decision. Battling grandparents may create a tumultuous situation. The court could also name a guardian who you would never have chosen. A will lets you decide.

Speak with an estate planning attorney to make sure you have a will that is properly prepared and follows the laws of your state. You also want to have a power of attorney and a health care agent named. Having these plans made before you need them, gives you the ability to express your wishes in a way that can be legally enforced.

Reference: Fatherly (Feb. 6, 2019) “How to Write a Will: 8 Tips Every Parent Needs to Know”

 

The Right Documents for Estate Planning

“Make sure that you have the right documents in place to protect your family and yourself.”

Having a properly prepared estate plan, that includes all the important documents, including a will and power of attorney, is one of the most important ways to protect your family and yourself. Despite this fact, many adults still neglect to take care of this important task, reports Consumer Reports in its article “8 Essential Steps for Estate Planning.”

A survey from Caring.com showed that as many as 60% of adults don’t have estate planning documents. When they asked families with young children, fewer than one in ten have even designated a guardian to take care of their children, if both parents should die.

What happens when there’s no planning in place? Even the simplest things become more complicated, and complicated things become financial and legal nightmares. When there’s an emergency and decisions need to be made, the entire family is subjected to more stress and costs than would otherwise be necessary.

Here are the eight steps you need to take, right now, to protect your family:

1. Get the professional help you need. The change to the tax law may or may not impact your family and your estate plan, but you won’t know until you sit down with an estate planning attorney. Trying to do this online, may seem like a simpler way, but you will not have the same peace of mind as when you sit down with an experienced attorney—and one who knows your state’s laws.
2. Create a will. This is a legal document that explains how you want your assets to be distributed after you die. It names an executor to carry out your instructions. If you have minor children, this is an especially important document, since it is used to name their guardian. If you have no will when you die (called dying “intestate”), then the laws of your state determine how your assets are distributed and who rears your children. Depending on where you live, your spouse might not automatically inherit everything.
3. Discuss whether you need a Revocable Living Trust. In most states, when you pass away, your estate goes through a process called “probate.” The courts basically review your estate plan and determine whether everything looks right. The problem is that your will becomes a public document—and so does information about your assets. Some people prefer to keep their lives private by transferring assets to a revocable living trust, which distributes assets according to your instructions at your death. Titles to the assets must be changed, so they are “owned” by the trust. This is known as “funding” the trust. You still retain complete control of your assets, since you are the trustee. However, if you fail to retitle assets, the estate goes through probate. You will also still need a will to protect your minor children.
4. Review your beneficiaries. Whether you remember it or not, when you open many different kinds of accounts—banking, investment—you assign a beneficiary to receive the assets upon your death. Your will does not override the beneficiary designation. Therefore, if you haven’t changed your life insurance beneficiary, for instance, and your ex-wife is still named on the document, she’ll get the entire proceeds of the life insurance policy when you die. This is a very important task.
5. Have a Durable Power of Attorney (DPOA) created. This is something that protects you, while you are living. If you should become incapacitated, having a durable power of attorney in place will allow that person to manage your financial affairs. Make sure the institutions that have your accounts accept your attorneys’ POA form; you may need to get the one that the institution uses.
6. Don’t forget the Advance Directive. This is also known as a Living Will. It explains your wishes for medical procedures, if you are unable to communicate and explains what you want for end-of-life care. Make sure that your family members know that you have such a document and keep it accessible in case of an emergency.
7. Pick a Healthcare Proxy. The Healthcare Proxy, also known as the Durable Power of Attorney for Healthcare, names someone to convey your healthcare wishes. It should include a HIPAA release clause. This allows medical personnel to release your medical records and speak with the named person about your care.
8. Get it all organized. Think of this step as creating a user’s manual for yourself. All these plans won’t do any good, unless your loved ones know they exist and know where to locate them. Don’t put your estate planning documents and records in a bank safe deposit box, in case it is sealed on death. Your attorney will likely have an original, and you should have your original in a fire-proof safe in a secure location in your home.

Reference: Consumer Reports (Oct. 24, 2018) “8 Essential Steps for Estate Planning”

You Can Avoid Elder Financial Abuse, but How? 你可以避免老人經濟虐待，但如何？(中英對照)

“While a longer life is a good thing, it will also present challenges – and unfortunately, sometimes financial predators.”

The prospect of a long, healthy and active life is a wonderful thing to consider. However, one in 10 seniors have suffered financial abuse, according to The Kansas City Star’s article “Five ways to avoid elder financial abuse.” The grandson of Brooke Astor spoke at a conference about how his grandmother’s last years were spent living in squalor, as a result of her son and guardian stealing from the estate and cutting the amount of money available for her care. The grandson and his brother sued their father to protect their beloved grandmother, a leading philanthropist and one of New York’s high-profile society figures.

However, elder financial abuse is not limited to the super wealthy or socially prominent. One report noted that one in ten seniors suffers some form of financial abuse.

Why does this happen?

As we age, our brain also ages making us more susceptible to making poor decisions. Even high-functioning retirees with no outward sign of dementia, find it harder to distinguish safe investments from risky ones. The probability of dementia also rises as we age: only 7% of people over 60 have dementia, but nearly 30% of people over age 85 have some degree of dementia.

Here are some suggestions to minimize the likelihood of financial elder abuse:

Communicate. Talk with your loved ones on a regular basis, so you know how their health is and what they are doing. If they don’t want to talk about money, you can start the conversation by sharing something about your own situation. Remind them about safe practices like shredding receipts, bills and account statements. Remind them not to open emails from people they don’t know and not to give their Social Security number or account numbers on the phone or online to people they don’t know.

Stay involved. Know how your loved ones are spending their time and money, by staying involved in their lives. If they are hiring people to do work on or in the house, know who those people are and check their backgrounds. Get to know their home healthcare aides. Review their bank statements to ensure no unusual activity is taking place. If you see that they are starting to decline, offer to take over tasks for them.

Check and balance. Make sure that the correct estate planning documents are in place to allow trusted family members to help, if the need arises, such as power of attorney and medical directive. Divide up responsibilities; consider having one person in charge of bank accounts and another in charge of investment accounts. Trade responsibilities every few months.

Have a relationship with their professionals. Attend meetings with their estate planning attorney and their financial advisor. If there is any hesitation on the part of the professional, push back: any qualified estate planning attorney or financial advisor or CPA should welcome family involvement.

Streamline accounts. Fraud is harder to see, when there’s money in multiple financial institutions with multiple advisors and life insurance policies from several different brokers. Spend the time to do a complete inventory of all accounts. If you can, consolidate accounts.

Reference: The Kansas City Star (Sep. 8, 2018) “Five ways to avoid elder financial abuse”

“雖然長壽是一件好事，但它也會帶來挑戰 - 不幸的是，有時也會帶來財產掠奪者。”

長壽，健康和積極的生活前景是一個值得思考的好事。然而，根據 The Kansas City Star的文章“Five ways to avoid elder financial abuse”，十分之一的老人正遭受經濟虐待。Brooke Astor的孫子在一次會議上發表講話，談到他的祖母過去幾年如何生活在惡劣環境中，她的兒子和監護人偷了她的資產並減少用於照顧她的錢。這位孫子和他的兄弟起訴他們的父親，以保護他們心愛的祖母，她是一位慈善家先鋒和紐約一位備受矚目的社會人士。

然而，老人的經濟虐待並不僅限於超級富豪或傑出人士。一份報告指出，十分之一的老人遭受某種形式的經濟虐待。

為什麼會這樣？

隨著年齡的增長，我們的大腦也會退化，使我們更容易做出糟糕的決定。即使是沒有癡呆症跡象的高能力退休人士，也很難將安全投資與風險投資區分出來。隨著年齡的增長，癡呆症的概率也會上升：60歲以上的人中只有7％患有癡呆症，但85歲以上的人中有近30％患有某種程度的癡呆症。

以下是一些建議，以盡量減少老人經濟虐待的可能性：

溝通  定期與您的親人交談，讓您知道他們的健康狀況以及他們正在做的事。如果他們不想談論金錢，你可以通過分享一些關於你自己的情況來開始。提醒他們關於撕碎收據，賬單和月結單的安全做法。提醒他們不要打開他們 陌生人的電子郵件，也不要在手機或網上向他們陌生人提供社會安全號碼或帳號。

保持參與  透過保持參與去了解親人是如何花時間和金錢。如果他們正在僱用人在家里工作，要知道那些人是誰並查他們的背景。了解他們的家庭醫療助理。查看他們的銀行月結單，確保沒有發生異常動靜。如果您發現它們開始下降，請接手管理。

檢查和制衡   確保制定正確的資產規劃文件，以便可信賴的家庭成員在需要時能幫助，例如財務授權書和醫療授權書。分工負責;考慮讓一個人負責銀行賬戶，另一個負責投資賬戶。每隔幾個月交換一次。

與專業人士建立關係   與他們的資產規劃律師及其財務顧問一起參加會議。如果專業人士有任何猶豫，請挻回去：任何合格的資產規劃律師或財務顧問或註冊會計師都應該歡迎家庭參與。

簡化帳戶   當錢在多個金融機構中, 而金融機構中有多個顧問及人壽保險單來自幾個不同經紀時，欺詐就更難看到了。花點時間去完成所有帳戶的完整清單。如果可以，合併帳戶。

參考: The Kansas City Star (Sep. 8, 2018) “Five ways to avoid elder financial abuse”