Family members play an extremely important role in representing and advocating for their aging loved ones in both legal and healthcare matters. At first, it may be uncomfortable to discuss end-of-life wishes with those close to you, but you will all have peace of mind knowing that estate planning wishes and advanced healthcare directives have been addressed.
Begin the Conversation
Start by arranging a comfortable time and place to discuss their plans. Ideally, all adults involved in the care plan will be able to meet at the same time so all voices are heard with first-hand communication. Sometimes, an attorney's office is an appropriate setting for this dialogue.
Will vs. Trust
Do your parents have a will? A trust? Accounts with named beneficiaries, pay-on-death or transfer-on-death accounts? Joint accounts with rights of survivorship? Understanding these details while your parents are in full command of their intellectual abilities is essential for protecting their wishes for their well-being and their legacy. Your parents should establish a will, which will outline how they wish to bequeath their assets and belongings to beneficiaries. They may also want to establish a trust to hold assets and transition them to the next generation; minimizing taxes and probate costs. Please refer to these two charts for more information: Wills Vs Trusts Form and How Trusts Save You Time and Money
The following are important legal documents an attorney will prepare to outline your loved ones' intentions in the event of an emergency such as incapacity:
Living Will – Provides specific instructions on whether your loved ones would like artificial life-sustaining medical treatments should they become permanently unconscious or terminally ill.
Durable Power of Attorney (POA) – Designates a specific individual as an "agent", who is legally authorized to make decisions on behalf of the individual(i.e., your parent, aunt, uncle). The nature of these decisions can be specified within the power of attorney, but generally include the ability to represent the client in a legal and financial capacity.
Durable Power of Attorney for Healthcare/Healthcare Proxy – This specific kind of POA authorizes the proxy to make healthcare decisions on your behalf, if you're unable to.
Location, Location, Location
Advanced directives and other essential documents are only useful if they are accessible. Original documents should be stored in a secure, organized location, such as a fire-proof safe at the attorney's office. Other important documents include copies of wills, trusts, and the advanced directives listed above; information on financial accounts; all non-employment income sources, including pensions, Social Security claims and retirement accounts; life insurance policies; titles to vehicles, homes and any other properties or assets; medical records; identity documents, including birth certificates, marriage certificates and Social Security cards; deeds to cemetery plots; and information on outstanding debts, credit cards, and any recurring expenses. If applicable, you'll also want to have them list all online accounts with their usernames and passwords. You can use this handy document checklist as a guide: Document Checklist
Solving the Long Term Care Puzzle
If the thought of paying over $150,000 a year for nursing home care is daunting, you are not alone. Even the most diligent saver can begin to feel the strain after a few months or years of care. In addition, Medicare insurance does not cover long-term care.
One option for handling the cost is long-term care insurance. Rates for long-term care insurance vary based on the policy holder's age, gender, health, type of coverage, daily benefit amount and benefit period, among other factors. Older clients can expect to pay more for coverage, and insurance companies may deny coverage for individuals older than 80 or those who have a chronic illness.
If your loved ones are unable to procure long-term care insurance due to health or financial reasons, another option to pay for care is Medicaid planning. This typically involves shifting assets into an irrevocable trust that can then be managed by you and/or your siblings. This option enables individuals to have their care covered by Medicaid while preserving assets they would like their loved ones to inherit, such as a house. Please refer to our long-term care puzzle https://bit.ly/3vcpAVX and schedule an appointment with one of our attorneys to position assets and reap the benefits of a clear flexible plan, even as puzzle pieces shift.
We hope these topics are a starting point to begin an ongoing conversation about how your loved ones wish to live life to the fullest on the road ahead and into the sunset years.
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.