TIME FLIES … Tempus fugit, so carpe diem

December 12th, 2013 | written by Nancy Larson

Seven D’s of Life That Affect Your Estate Plan:
Desires, dreams, drama, diagnosis, dementia, decline, death.

Time flies when you’re having fun!  Time also seems to pass more quickly the older we get.  There is nothing we can do to stop the passage of time, so we might as well make the best use of it.

Early in life, the brain is experiencing things for the first time.  Baylor neuroscientist, David Eagleman, has found that the brain uses more energy to process new and exciting experiences which results in more information being stored in your memory.  If these experiences take more space in our memory due to being new or novel, then this may account for such experiences being so vivid in our long-term memory.

As the brain and body age, there are natural changes that occur.  The focus of our thoughts and daily lives shift, and energy declines.  With the passing of time, priorities change. The focus of a young adult’s life is quite different from that of a retiree.  Now is a good time to take care of tasks that have been on the to-do list for a long time. Take a deep breath, grab a hot beverage, notepad and a pen – or an iPad – and jot down a few tasks that need tending.  Note the mile markers in your life as they have receded or those coming up ahead.

Clergy note that people often seek emotional and spiritual support at crossroads in their lives.  Rights of passage traditionally observed involve birth, marriage and death:  to hatch, match, dispatch.  Think of those crossroads as a time to reevaluate and update estate planning documents taking into consideration significant life changes.  Here are seven life events you can refer to as the Seven D’s:  (1) Desires (2) Dreams (3) Drama (4) Diagnosis (5) Decline (6) Dementia, and (7) Death.

Reflect on your ever-changing life and resolve to take care of what you can.  People continue to be surprised that time passes so quickly and waits for no one.  My mother remarks that life is like being on a boat in a moving river that never stops flowing — at some point we are simply not on the boat anymore.  (Thanks Mom!)

As time passes, know that you can make a difference in the quality of your life and others.  Live your life with peace of mind.  Prepare to leave a thoughtful legacy.  Remember to laugh, treasure each day, and have fun.  Time flies, so seize the day: Tempus fugit and carpe diem!

(December 2013)

Now, Where Did I Put My Keys? The Staggering Impact of Dementia

October 15th, 2013 | written by Heidi Dodd

Many of us joke that constantly losing our keys is the first sign of Alzheimer’s.  Well, breathe a sigh of relief.  Just misplacing your keys does not mean you suffer from dementia.  However, displaying several early symptoms of dementia may cause you to re-examine your situation.  Early symptoms of dementia include, but are not limited to: memory loss, difficulty in performing activities of daily living (i.e. bathing, dressing, eating), difficulty with communication and language, disorientation of time and place, changes in personality, or loss of initiative. Many of us know someone, or have a relative, diagnosed with dementia. A costly, heart-breaking and life-altering syndrome, it affects one in 20 people over the age of 65 and one in five over the age of 80.  These staggering statistics present a major economic, financial, and societal impact.

According to a recent study by the RAND Corporation, the cost of caring for those with dementia currently comes in higher than caring for those with heart disease or cancer.  The direct costs of dementia, including the cost of medicine and nursing homes, totaled $109 billion in 2010 compared to $102 billion for heart disease and $77 billion for cancer.  When placing a value on family members caring for loved ones at home, the cost increases to $215 billion a year.  (http://www.rand.org/news/press/2013/04/03.html).

While the tremendous cost to society will likely impact all of us, the significance of costs to individuals diagnosed with dementia and their loved ones grows exponentially.  As evidenced by the RAND study, each individual case of dementia costs between $41,000 and $56,000 a year. In addition to the financial drain on families, dementia increases the stress on the caregiver loved one. In fact, studies show and experts find an increased risk for depression, anxiety, and long-term medical problems, for caregivers of dementia patients, which impose a further financial burden on the family.  Often, caregivers ignore their own medical needs because they focus on caring for their family member with dementia and raising their own family.  Some refer to this type of caregiver as the “sandwich generation.”

The proper attention given to improvements in medicine with regard to dementia will assist society on getting a handle on this costly condition. And with help from an Elder Law attorney, the family of those afflicted with dementia can obtain the guidance and support they need to care properly for their loved one.  This includes access to community resources, support groups and getting legal and financial affairs in order prior to a crisis.  Plan early.  Everyone should obtain a Health Care Power of Attorney, Property Power of Attorney and a Last Will & Testament to make their wishes known and avoid crisis and court intervention.

Yours, Mine & Ours: Estate Planning for Blended Families

August 1st, 2013 | written by Nancy Larson

Yours, Mine & Ours:  Estate Planning for Blended Families
The number of households with stepchildren has doubled in the last ten years, so it should come as no surprise that you may be the parent or grandparent of a “blended family.”  Are you prepared?

A blended family brings together children, assets, and often different family values and cultures.  The history and present circumstances of two distinct families coming together can be complex and sometimes volatile as often times one or both families have dealt with a painful divorce or death.  Bringing those issues under one roof takes commitment, planning, and pulling together. Some blended families come into the union from a position of distrust and suspicion, while others are naturally more in sync.  Over time, the dynamics often change.

Strong loyalty outside of the blended family unit add to complexity.  These are all factors to consider in estate planning, and need to be taken into account when choosing your executor, trustee, and/or guardian.  About one-third of all weddings in the United States create step-families, according to the National Center for Family & Marriage Research. In a first marriage, a spouse typically wants all assets to pass to the surviving spouse, then equally to the children at the death of the second spouse.  In a blended family where a couple has one or more children from a prior relationship, planning may not be so simple.

What about the kids? Adjustments may be needed if there is a significant age disparity between spouses and between two sets of children.  After discussion with your spouse, clearly state custodial and guardianship preferences in a will.  If you don’t, the state will step in and decide for you where your children will live and who will manage your children’s inheritance.  Do you want your husband’s next wife to have any influence over the management of your children’s inheritance?

The need for clear communication in the parental estate planning is of great importance and must also take into consideration the distinction between half-siblings and step-siblings.  Further, children may have multiples sets of grandparents and step-grandparents, all of whom may consider a child as part of the family and yet should they also make provisions for the step-grandchild — or just the biological grandchild?
Having biological and stepchildren or step-grandchildren in the mix requires you to clearly outline what and who is important in your estate plan.  If you are a parent or grandparent in a blended family, drafting a will (and sometimes a trust) is essential to carry out and to protect your wishes.  Don’t be too hasty to reassign family heirlooms or assets to new blended family member.

Remember:  there are no ex-parents or ex-grandparents; only ex-spouses.  Choose carefully in who takes responsibility for your estate and managing it after your passing.
Consult a trusted and patient estate planning attorney to work through the issues of estate planning for a blended family.

August 2013

Spring Cleaning, or 41.7 Billion Reasons to Engage in Estate Planning

May 22nd, 2013 | written by Nancy Larson

Money you don’t know exists may be earmarked for you.  Roughly $41.7 billion of unclaimed assets are held by state treasurers across the country – with $1.7 billion being held by the State of Illinois – according to the National Association of Unclaimed Property Administrators.  In 2012, $129 million dollars was returned in Illinois.

Much of this unclaimed money results from someone not having an estate plan or failing to stay organized.  People lose track of assets when someone dies or addresses change.  Effective estate planning imposes organization on personal and legal matters.  It is a time to check on the titling of assets and beneficiary designations.  Executing estate planning documents like wills, trusts, and powers of attorney, is essential — but equally important is letting your loved ones know where you keep them.

Keep estate planning documents safe, but tell someone where the documents are kept. Sometimes people forget where they hid something important.  Not only do they want to keep it safe, people also don’t want prying eyes to take a premature look at the contents of their private papers.  As attorneys, we will note in our file, if you tell us, where original documents will be kept.  A safe deposit box at a bank is ideal but some people choose metal boxes or file cabinets at home.  It is important for your executor or trustee to be able to retrieve the original will or trust document.

Spring cleaning includes organizing your electronic and internet information.  Keep a printed or handwritten list in a secure place of the following:  passwords and usernames, PINs, online accounts, and social media.

Compile this information in a file with copies (not originals) of your estate planning documents, recent financial statements, insurance policies, car titles, deeds, mortgages, promissory notes, certificates of marriage, divorce papers, military records, prepaid burial, immigration records, etc.

Unclaimed money that the state holds belongs to the owner in perpetuity. If you don’t claim the asset, generations from now an heir could claim the property with the right paperwork.  The state never takes ownership of the property, but serves as custodian.   According to the Illinois I-Cash program, typical unclaimed property currently held by the treasurer’s office includes money from inactive savings and checking accounts, unpaid wages or commissions, stocks, bonds, mutual funds, money orders, paid-up life insurance policies, and safe deposit box contents.

If a safe deposit box has been inactive for five (5) years, the name of the owner of the box will be published.  If the contents are not claimed, then the Treasurer’s Office for the State of Illinois receives the contents of the safe deposit box.  If the owner, or his/her heirs, do not submit a claim then the contents may be sold and the proceeds will be held in perpetuity by the state.  Items commonly held in safe deposit boxes that may be auctioned include jewelry, small heirlooms, coins, stamps, and other collectibles.  Military medals are not sold at auction.

Many of our clients are contacted by the state because as young children their parents bought small life insurance policies from companies that have been demutualized. They now may find themselves owners of shares of stock in well-known companies such as Metropolitan Life, Prudential, or John Hancock.  Decades later, it is possible to claim residual value on those policies by the individual or the heirs.

$41.7 billion in unclaimed assets is motivation to visit an estate planning attorney to put your legal affairs in order and to give yourself and your family the peace of mind that you and they deserve.

You can find out if you have unclaimed property in the State  of Illinois by checking the I-Cash program at www.icash.illinois.gov, emailing info@icash.illinois.gov, or calling 217-785-6998.  The website of the National Association of Unclaimed Property Administrators (NAUPA) has links to search your name in the database of each state in the country.  Any state you have worked or lived, or any name you have used (i.e. maiden name), can be searched by using the NAUPA website.  Additionally, 37 states (other than Illinois) have cooperated to combine databases where users can search at MissingMoney.com .

(Submitted to BND Adult Lifestyles, 05/09/13)

Top 10 Reasons

April 16th, 2013 | written by Nancy Larson

The Top 10 Reasons To Execute a Power of Attorney
By:  Heidi Dodd

The benefits of a highly detailed, comprehensive power of attorney are numerous.  Unfortunately, many powers of attorney are more general in nature and can actually cause more problems than they solve, especially for our aging population.  It is important to choose a reliable and honest agent.

The agent under a power of attorney has traditionally been called an “attorney-in-fact” or sometimes just “attorney.”  The “principal” is the individual who has appointed the agent to represent him or her.

Powers of attorney are voluntary delegations of authority by the principal to the agent.  The principal has not given up his or her own power to do these same functions but has granted legal authority to the agent to perform various tasks on the principal’s behalf.  A “durable” power of attorney allows principals to include in their powers of attorney a simple declaration that no power granted by the principal in a power of attorney will become invalid upon the subsequent mental incapacity of the principal.

Let’s review the top 10 reasons to execute a property power of attorney:

1.  Provides the ability to choose who will make decisions for you (rather than a court).
If someone has signed a power of attorney and later becomes incapacitated and unable to make decisions, the agent named can step into the shoes of the incapacitated person and make important financial decisions.  Without a power of attorney, a guardianship may need to be established, and can be very expensive.

2. Avoids the necessity of a guardianship.
Someone who does not have a power of attorney at the time they become incapacitated would have no alternative than to have someone else petition the court to appoint a guardian.  The court will choose who is appointed to manage the financial and/or health affairs of the incapacitated person, and the court will continue to monitor the situation as long as the incapacitated person is alive.  Unfortunately, an incapacitated person has no input on who will be appointed to serve on their behalf.

3.  Provides family members a good opportunity to discuss wishes and desires.
There is much thought and consideration that goes into the creation of a comprehensive power of attorney.  One of the most important decisions is who will serve as the agent.  When a parent or loved one makes the decision to sign a power of attorney, it is a good opportunity for the parent to discuss their wishes and expectations with the family, especially the agent.

4.  The more comprehensive the power of attorney, the better.
As people age, their needs change and their power of attorney should reflect that.  Seniors have concerns about long-term care, applying for government benefits to pay for care, as well as choosing the proper care providers.  Without allowing the agent to perform these tasks and more, precious time and money may be wasted.

5. Prevents questions about principal’s intent.
Many of us have read about court battles over a person’s intent once that person has become incapacitated.  A well-drafted power of attorney, along with other health care directives, can eliminate the need for family members to argue or disagree over a loved one’s wishes.  Once written down, this document is excellent evidence of their intent.

6.  Prevents delays in asset protection planning.
A comprehensive power of attorney should include all of the powers required to do effective asset protection planning.  If the power of attorney does not include a specific power, it can greatly dampen the agent’s ability to complete the planning and could result in thousands of dollars lost.

7.  Allows an agent to enter into a care agreement.
Most of us want to age in place in our homes.  Allowing your agent the authority to enter into a contract on your behalf to provide care for you through a home healthcare agency or a family member as a caregiver is critical.

8.  Allows agents to talk to other agencies.
An agent under a power of attorney is often in the position of trying to reconcile bank charges, make arrangements for health care, engage professionals for services to be provided to the principal, and much more.  Without this authority, many companies will refuse to disclose any information or provide services to the incapacitated person.  This can result in a great deal of frustration on the part of the family, as well as lost time and money.

9.  Allows an agent to assist in qualifying for government benefits.
In the event you need to enter into assisted living or a long-term care facility, it is important that your agent have the authority to assist in qualifying you for any government benefits such as Medicaid and veteran’s benefits.

10.  Provides peace of mind for everyone involved.
Taking the time to sign a power of attorney lessens the burden on family members who would otherwise have to go to court to get authority for performing basic tasks, like writing a check or arranging for home health services.  Knowing this has been taken care of in advance is of great comfort to families.

Which benefits are most important depends on the situation of the principal and their loved ones.  This is why a comprehensive power of attorney is so essential:  Nobody can predict exactly which powers will be needed in the future.  The planning goal is to have a power of attorney in place that empowers a succession of trustworthy agents to do whatever needs to be done in the future.