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What You Should Know About Conservatorship—In Case A Parent or Loved One Becomes Incapacitated

What You Should Know About Conservatorship—In Case A Parent or Loved One Becomes Incapacitated

Whether through illness, injury, or other means, anyone can require a conservator to become appointed if they become mentally incapacitated. In such cases, if there is no estate planning in place (or insufficient planning) to keep family or other loved one’s out of court, a conservatorship, or conservatorship as it is sometimes called, must be established via a court process in the county probate court.

Obtaining conservatorship can be an extraordinarily challenging and expensive process. It begins with filing a petition in court for conservatorship and requesting the court declare the incapacitated person incompetent. In some cases, these types of filings are made “ex parte”, or in secret, and a conservatorship can be established before family or close friends even know what’s happening. In other cases, such a filing can result in a heated dispute between family members and/or friends, who may claim they’d be better suited for the role. Given this, things can get quite costly very quickly.

Of course, this assumes these matters haven’t already been decided through proper and up-to-date estate planning, including a valid durable power of attorney and advance health care directives, which are the best methods for ensuring this massive responsibility is handled as effectively as possible. Sadly, most people don’t think of the costly possibility of incapacity and therefore leave their families at risk.

If you do have a loved one who needs a conservator, here are some of the things you’ll need to know:

Who can be appointed as conservator?

Unless specified in a valid legal document, any family member or other interested person can petition for conservatorship—even a close friend can do it if they prove they’re best suited for the position. That said, most courts give preference to the ward’s spouse or other close family members. In some cases, the conservator is required to post a bond, which typically requires good credit and some level of deposit to be held in the event of the conservator’s wrongdoing. This bond requirement often disqualifies friends and family, who either don’t have good credit or the resources to post a bond.

If a relative or friend is not willing—or capable—of serving, the court will appoint a professional conservator or public conservator. This is one of the ways that an estate can be drained extremely quickly. If you want to hear more about how this can happen, read this terrifying article about the way public and professional conservators are stealing from our elders.

When are conservators appointed?

A conservator will only be appointed if a court determines there is enough evidence to show a person is mentally incapacitated, such that they can no longer make legal, financial, and/or health-care decisions.

What are a conservator’s responsibilities?

Depending on the extent of the ward’s mental capacity, a court-appointed conservator can be given near complete control over a person’s life and finances. Some of the most common duties include:

  • Paying the ward’s bills
  • Determining where they live
  • Monitoring their residence and living conditions
    Providing consent for medical treatments
  • Deciding how their finances are handled, including how their assets are invested and if any assets should be liquidated
  • Managing real estate and other tangible personal property
  • Keeping detailed records of all their expenditures and other financial transactions
  • Making end-of-life and other palliative-care decisions
  • Reporting to the court about the ward’s status at least annually

The extent of duties the conservator is responsible for is up to the court, and the conservator will not be allowed to act in areas the court has not authorized. Moreover, conservators are required to seek the ward’s preferences whenever possible—though ultimately, the decision about what action to take will be in the conservator’s hands.

The court can also divide out responsibilities to multiple parties. For example, one person may oversee the financial decisions, while another handles living arrangements and health-care decisions. What’s more, the court often requires detailed status reports, such as financial accounting, at regular intervals or whenever important decisions are made, such as the sale of assets.

Are conservators compensated?

Yes, conservators are entitled to reasonable compensation for their services based on the ward’s financial ability to pay. The appointed conservator is paid directly from the ward’s estate. In most cases, the compensation must be approved by the court ahead of time, and the conservator must carefully account for all of their services, the time spent on tasks on behalf of the ward, and any associated out-of-pocket expenses.

Given the huge level of responsibility and loss of control that comes with conservatorship, the best course of action would be to get proper and updated estate planning in place ahead of time to ensure that if you or anyone you love becomes incapacitated, you can stay out of the court process altogether if possible.

Contact us as your neighborhood Personal Family Lawyer® to schedule a Vision Meeting—first for yourself—and then for the people you love before something happens to make it too late to plan. If it’s already too late and you’re reading this article because you need assistance petitioning a court for conservatorship, contact us now to mitigate the risks, hassles, and expense.

Common Estate Planning Pitfalls Seniors (Including You or Your Parents) Can’t Afford to Make

Common Estate Planning Pitfalls Seniors (Including You or Your Parents) Can’t Afford to Make

Estate planning really should be considered as soon as you acquire your first asset, have a child, or step into adulthood in any truly meaningful way. And yet many of us put it off for far too long, leaving ourselves and our families at risk of getting stuck in the court system in the event of an unexpected accident, illness, or injury.

Once you (or your parents) reach senior status, you can no longer pretend that estate planning is something you can put off. The effects of aging become impossible to ignore, and the fact that you’re not going to live forever moves to the front of your mind.

While planning for your incapacity and death can be scary, it’s even more frightening to think of the potential tragedies that can arise if you and your family don’t have the right planning in place. More and more, the media is highlighting the reality that without proper planning, the elderly can lose everything, even if they have family looking after them.

At the senior stage of life, effective estate planning is urgent, both for you and the people you love. And if you aren’t a senior yet yourself but have senior parents, get your own planning handled, and then use that as a model to get your parents’ planning taken care of.

Here are a few of the most common errors seniors make when it comes to estate planning and how to fix them:

Not creating advance medical directives

In your senior years, health care matters become much more relevant and urgent. At this age, you can no longer afford to put off important decisions related to your medical needs.

Two of the most important considerations you face are how you want your medical care handled in the event you become incapacitated, and how you want medical care to be handled at the end of your life. Both of these situations can be addressed using an Advance Health Care Directive, which contains a medical power of attorney and a living will.

The Advance Health Care Directive allows you to name the person you want to make healthcare decisions for you if you’re incapacitated and unable to make decisions yourself.

It also provides guidelines for how your medical care should be handled, if you become unable to voice your wishes. In addition to guidelines about how you want your medical care handled, your living will may also include instructions on the type of food you want to be fed to you, as well as who should be able to visit you.

In order to ensure that your health care wishes are properly handled—even in the most dire circumstances—creating these advance directives is a must.

Relying only on a will

Many people, particularly older folks, believe that a will is the only estate planning tool they need. While wills are definitely one key aspect of estate planning, they come with some serious limitations:

● Wills require your family to go through probate, which is open to the public and often expensive.
● Wills don’t offer you any protection if you become incapacitated and unable to make legal and financial decisions.
● Wills don’t cover jointly owned assets or those with beneficiary designations, such as life insurance policies.
● Wills don’t shield assets from your creditors or those of your heirs.
● Wills don’t provide protections or guidance for when and how your heirs take control of their inheritance.

Fortunately, all of the above areas can be effectively managed using a trust. However, some people are reluctant to use trusts because they’re unfamiliar with them and have been told a will is all they need.

What’s more, because until fairly recently trusts were primarily used by the ultra-wealthy, many believe they’re an extravagance they don’t need and can’t afford. But the truth is, people of all income levels and asset values can afford and benefit from trusts, which provide numerous protections unavailable through wills.

If you’re relying solely on a will for estate planning, you’re missing out on many valuable safeguards for your assets, while also guaranteeing your family will have to go to court when you die.

If you aren’t sure what you need, begin by contacting us for a Vision Meeting. Your Vision Meeting is custom-designed to your assets, your family, your wishes, and to educate you on the best way to reach your objectives for the people you love.

Not keeping your plan current

Far too often people prepare a will or trust when they’re young, put it into a drawer, and forget about it. But your estate plan is worthless if you don’t regularly update it when your assets, family situation, and/or the laws change.

We recommend you review your plan annually to make sure it’s up to date and immediately amend it following events like divorce, deaths, births, and inheritances. With us as your Personal Family Lawyer®, we have built-in processes to ensure these updates are made right away.
And when it comes to a trust, it’s not enough to simply list the assets you want it to cover. You have to transfer the legal title of certain assets—real estate, bank accounts, securities, brokerage accounts—to the trust, known as “funding” the trust, in order for them to be distributed properly.
While most lawyers will create a trust for you, few will ensure your assets are properly funded. But with us as your Personal Family Lawyer®, we’ve got processes in place to keep track of your assets over life, make sure none are lost to your state’s Department of Unclaimed Property, and that you don’t inadvertently force your family into court because your plan wasn’t fully completed.

Not pre-planning funeral arrangements

Although most people don’t want to think about their own funerals, pre-planning these services is a key facet of estate planning, especially for seniors. By taking care of your funeral arrangements ahead of time, you not only eliminate the burden and expense for your family, you’re able to make your memorial ceremony more meaningful, as well.

In addition to basic wishes, such as whether you prefer to be buried or cremated, you can choose what kind of memorial service you want—simple, elaborate, or maybe none at all. Are there songs you want played? Prayers or poems recited? Do you have a specific burial plot or a spot where you want your ashes scattered?

Pre-planning these things can help relieve significant stress and sadness for your family, while ensuring your memory is honored exactly how you want.
If you’re already in your senior years, about to be, or have a parent who is, it’s critical that you take care of your estate planning immediately and avoid these common pitfalls. As your Personal Family Lawyer®, we’ll walk you step-by-step through the process, ensuring that you have everything in place to protect yourself, your assets, and your family. Contact us today to get started.

I Don’t Have Kids, So Why Do I Need Estate Planning? Part 2

I Don’t Have Kids, So Why Do I Need Estate Planning? Part 2

Last week, we shared the first part of our series on the importance of estate planning for those without children. If you haven’t read it yet, you can do so here.  Here in part two, we discuss the other risks involved for those who forego estate planning.

Someone will have power over your health care
Estate planning isn’t just about passing on your assets when you die. In fact, some of the most critical parts of planning have nothing to do with your money at all, but are aimed at protecting you while you’re still very much alive.

Advance planning allows you to name the person you want to make healthcare decisions for you if you’re incapacitated and unable to make decisions yourself.

For example, if you’re temporarily unconscious following a car accident and unable to give doctors permission to perform a potentially risky medical treatment, it’s not always clear who’ll be asked to make that decision for you.

If you have a romantic partner but aren’t married and haven’t granted them medical power of attorney, the court will likely have a family member, not your partner, make that decision. Depending on your family, that person may make decisions contrary to what you or your partner would want.

Indeed, if you don’t want your estranged brother to inherit your property, you probably don’t want him to have the power to make life-and-death decisions about your medical care, either. But that’s exactly what could happen if you don’t proactively plan.

Even worse, your family members who have priority to make decisions for you could keep your dearest friends away from your bedside in the event of your hospitalization or incapacity. Or family members who don’t share your values about the types of food you eat, or the types of medical care you receive, could be the one’s making decisions about how you’ll be cared for.

Even if, or maybe especially if, you don’t have kids, you need to do estate planning in order to name health care decisions-makers for yourself and provide instructions on how you want decisions made.

Someone will get power over your finances
As with health-care decisions, if you become incapacitated and haven’t legally named someone to handle your finances while you’re unable to do so, the court will pick someone for you. The way to avoid this is by naming someone you trust to hold power of attorney for you in the event of your incapacity.

Durable power of attorney is an estate planning tool that gives the person you choose immediate authority to manage your financial matters if you’re incapacitated. This agent will have a broad range of powers to handle things like paying your bills and taxes, running your business, collecting your Social Security benefits, selling your home, as well as managing your banking and investment accounts.

Because these powers are so broad, it’s critical that you only give this power to someone you absolutely trust, and ideally, with the guidance of a lawyer who can watch out for your best interests.

The fact that durable power of attorney is granted as soon as you’re incapacitated means your agent can begin handling your finances immediately, without waiting for a judge’s decision, simply by presenting a legal document and appropriate proof of your incapacity to a financial account holder. Since courts are notoriously slow, this quick access can be immensely beneficial to ensure your bills get paid on time and you have the funds available when you need them.

Without signed durable power of attorney, your family and friends will have to go to court to get access to your finances, which not only takes time, but it could lead to mismanagement and even the loss of your assets should the court grant this authority to the wrong person.

Furthermore, the person you name doesn’t have to be a lawyer or financial professional—it can be anybody you choose, including both family and friends. The most important aspect of your choice is selecting someone who’s imminently trustworthy, since they will have nearly complete control over your estate. Besides, with us as your Personal Family Lawyer®, your agent will have access to us as your trusted counsel should they need guidance or help.

Given all of these potential risks, it would be foolhardy for those without children to ignore or put off these basic estate-planning strategies. Identifying the right planning tools is easy to do, and begins with a Family Wealth Planning Session, where we can consider everything you own and everyone you love, and guide you to make informed, educated, empowered choices for yourself and your loved ones.

It will likely take just a few hours of your time to be certain that both your assets, healthcare, and relationships will be managed in the most effective and affordable manner possible in the event of your death or incapacity.

I Don’t Have Kids, So Why Do I Need Estate Planning? Part 1

I Don’t Have Kids, So Why Do I Need Estate Planning? Part 1

It’s a common misconception to think that if you don’t have children, you don’t need to worry about estate planning. But the fact is, it can be even MORE important to do estate planning if you have no children.

Some of the common thoughts behind this mistaken belief may take one of these forms:

“If I die, everything will pass to my spouse anyway, so why bother?”

“I’m single with little wealth, so who cares who gets my few meager assets?”

“Estate planning is an expensive hassle and it doesn’t even benefit me because I’ll be dead, so I’m better off letting a judge handle things.”

This kind of thinking ignores several basic facts about both estate planning and life in general. Regardless of your marital status, if you don’t have children, you face potential estate-planning complications which those with children do not. And this is true whether you’re wealthy or have very limited assets.

Without proper estate planning, you’re not only jeopardizing your personal property, but you’re putting your life at risk, too. And that’s not even mentioning the potential conflict and expense you’re leaving for your surviving family and friends to deal with.

So if you’re childless, consider these three inconvenient truths before you decide to forego estate planning.

Someone will get your stuff
Whether you’re rich, poor, or somewhere in between, in the event of your death everything you own will be passed on to someone. Without a will or trust, your assets will go through probate, where a judge and state law will decide who gets everything you own. In the event no family steps forward, your assets will become property of your state government.

Why give the state everything you worked your life to build? And even if you have little financial wealth, you undoubtedly own a few sentimental items, including pets, that you’d like to pass to a close friend or favorite charity.

However, it’s rare for someone to die without any family members stepping forward. It’s far more likely that some relative you haven’t spoken with in years will come out of the woodwork to stake a claim. Without a will or trust, state laws establish which family member has the priority inheritance. If you’re unmarried with no children, this hierarchy typically puts parents first, then siblings, then more distant relatives like nieces, nephews, uncles, aunts, and cousins.

Depending on your family, this could have a potentially dangerous—even deadly—outcome. For instance, what if your closest living relative is your estranged brother with serious addiction issues? Or what if your assets are passed on to a niece who’s still a child and likely to squander the inheritance?

And if your estate does contain significant wealth and assets, this could lead to a costly and contentious court battle, with all of your relatives hiring expensive lawyers to fight over your estate—which is exactly what’s happening with Prince’s family right now.

Finally, even if you have a spouse and your assets are passed to him or her, there’s no guarantee they’ll live much longer than you. In the event of their death without a will or a trust, everything goes to his or her family, regardless of the fact that you can’t stand your in-laws.

You really don’t want your spouse’s sister, brother, parents (or the new spouse he or she marries after you die) inheriting what you’ve worked so hard for, do you?

Next week, we’ll continue with part two in this series on the value of estate planning for those without children: how you could be leaving YOURself at risk.

Securing Your Senior Parents' Identity and Financial Assets

Securing Your Senior Parents' Identity and Financial Assets

Today, we live in an uber-connected world, where nearly every type of financial transaction—shopping, banking, investment management—can be made online using a computer or mobile device.

In light of this, it’s critically important to have the appropriate safeguards in place to reduce the risk of fraud and identity theft, especially for your senior parents. Because your parents are probably not as savvy about digital technology and may be losing some of their powers of discernment as they age, it’s quite likely up to you to help them protect themselves—and ultimately your inheritance.

Along with traditional estate planning strategies to ensure you’re parents’ planning is handled in the event of their incapacity or death, you should take the following four precautions to ensure the safety of their identity and finances while they’re still alive and well.

1) Secure their computer: Your first step should be to make sure all computers they use are protected by robust security software bundled with anti-virus, anti-spam, and spyware detection features. Always go with the latest version of software, and make sure it’s configured to provide automatic updates, including security patches.

2) Use strong passwords and PINs: Create strong passwords and PINs that contain numbers, letters, and symbols, and change them regularly (once every six months). Don’t use the same password for multiple accounts—each account should have its own unique password. Never share passwords, don’t store them on a computer, and keep them in a secure location.

Since diligently keeping up with passwords can be a hassle, invest in a password manager, such as LastPass, which generates and stores strong, complicated passwords and can be used to share passwords with you and other family members.

Consider activating 2 Factor Authorization (2FA) on your parents’ accounts by using your cell phone number as the authenticating phone number or even Google Authenticator, and then teach your parents how to use it.

3) Regularly monitor their credit score and reports: Because thieves can use your loved ones’ personal information to set up new credit cards and other accounts, with bills that won’t get mailed to their home, be sure to regularly check their credit score and report for any suspicious activity. We like to use CreditKarma.com or TotalCreditCheck.com.

4) Use their own computer and avoid public wireless: Because public computers can be rigged to capture passwords and other personal data, seniors should always use their own computer or device to make financial transactions.

Even using one’s own computer can be risky if it’s done on a public wi-fi network, as found in airports, hotels, and restaurants. Many public wireless hotspots reduce their security settings, so people can more easily access and use these networks, which makes it easier to intercept personal information.

While taking these precautions is vital, it’s only the first step to ensure your elderly parents’ financial resources are protected. Consult with us as your Personal Family Lawyer® to develop comprehensive estate planning strategies to safeguard not only their finances, but all of their tangible and intangible assets—as well as your own.

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