With increasing longevity comes a host of challenging issues. One of them is maintaining an up-to-date estate plan.
Do Your Parents Have an Up-To-Date Estate Plan?
Adult children are now more than ever challenged by their concern that their aging parents may not have an up-to-date estate plan, or even one at all, and what to do about it.
The Repercussions When They Don’t
Many of us have experienced firsthand the problems and distress that can result if a parent does not have a current will or power of attorney. Provisions that made sense 15 or 20 years ago may no longer do so and will not take into account family, financial, legal and tax changes. As well, if your parent does not have a power of attorney and becomes incapable, it will be necessary to apply to the court to have a guardian appointed, which is an intrusive, public, expensive and lengthy process.
Navigating Sensitive Conversations
Adult children will often feel a responsibility to make sure their aging parents’ affairs are up to date, including as a preventative measure since children will often need to deal with the repercussions if they are not. But it can be challenging to raise this issue with their parents, who may guard their privacy and quite bluntly may feel it is none of their children’s business. Talking about death and incapacity is also a cultural taboo for many.
So, how can you approach these topics and start the conversation if you are concerned that your parents may not have their affairs in order?
1. Small Steps First
One idea is to start with small steps. Children will want to and will need to know what to do if a parent becomes very ill and is not able to make personal care decisions, including in an emergency, or loses their capacity.
Who is appointed to make these decisions?
Is there an up-to-date power of attorney for personal care in place and a letter of wishes or other guidelines regarding personal care issues, including end-of-life decisions?
2. Breaking the Ice: Personal Care Matters
These are valid concerns and a good start might be for you to express your concern for your parent’s welfare. “Dad, I am concerned that if you suddenly become very ill that we know what the next steps are, who will make decisions for you and make sure your wishes are carried out”.
This approach hopefully can start a dialogue on a variety of personal care matters, such as aging in place in one’s home versus institutional care, dealing with issues such as whether or not your parent wishes heroic measures be used if they are at the end of life, and who is to act as attorney for personal care.
For the parent who does not have an up-to-date power of attorney for personal care, it can be the impetus to get one in place.
3. Raising Financial Management Issues
Dealing with personal care issues first can lead to a discussion on incapacity matters in general, including whether your parent has an up-to-date financial power of attorney in place so that should they no longer be able to manage their financial affairs, their chosen attorney or attorneys can do so on their behalf.
A concern many children have is understanding the process for “activating” a financial power of attorney. They may have noticed their parent declining, having memory loss, and generally finding it increasingly difficult to cope with paying their bills, filing their taxes, reviewing their insurance policies and other financial matters, but don’t know what the next steps are to deal with this situation.
In Ontario, most financial powers of attorney do not contain a condition that they only come into effect once a person is determined to be incapable of managing their property. Instead, it can be immediately used once the financial power of attorney has been delivered to the named attorney or attorneys to use.
In some cases, the law firm which prepared it may hold it in an escrow arrangement pursuant to the client’s direction not to release it to the named attorney or attorneys unless the client is capable and directs that it be released, or if the law firm is provided with satisfactory medical evidence that the client is not capable of managing their property.
4. Finally: Planning for Death
A conversation on personal care and financial powers of attorney can lead to a discussion on other estate planning matters, such as whether a parent’s will is up-to-date.
No doubt these conversations are very sensitive, but it is important that they be had in the best interest of your parent and the family. Looking at it that way can create common ground between parent and child, and the foundation for a constructive discussion.
There is a lot of media attention focused today on estate planning and many helpful articles and other reading. This has raised public awareness and created more transparency and openness on these issues, helping to erode cultural taboos. This will only continue in future—and is all for the good.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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