2012-05-18 / Columnists

Spotlight On Elderlaw

Commentary By Nancy J. Brady, RN, Esq. And Linda Faith Marshak, Esq.

As estate planning attorneys, when we meet with clients during our initial consultation, it is necessary for us to obtain information regarding income and assets. On an all too frequent basis, the clients, and their families, do not have a clear understanding of the financial situation. This happens for many reasons such as the disability or recent loss of a spouse who handled the family finances; and sometimes a gradual decline in ability to manage finances due to advanced age.

People with an unclear or incomplete understanding of their finances often fail to budget for expenses properly, and may miss important payments which can affect overall credit scores. The elderly, in particular, may fall prey to various financial “scams.” Often, family members need to provide assistance to their relatives to avoid these situations.

Family members are often reluctant to overstep their bounds by suggesting they provide assistance with financial management, sometimes because of the fear of insulting their parent or loved one by suggesting that assistance may be necessary. We have found in many cases the opposite to be true – often the person having difficulty getting a handle on managing or understanding their finances is relieved and happy to have the assistance. The following is an outline of the steps that should be taken to provide assistance to your parent or loved one with managing finances.

Power of Attorney: notice the bolding, underlining and italicizing – this is THE MOST IMPORTANT document to have in place in order to provide legal authority to another person to manage one’s finances. In New York State, in 2009 and again in 2010, modifications were made to the power of attorney document. It is important to have the updated changes on the document, and the proper signing by two witnesses and notary. Without a valid power of attorney in place, should your loved one require assistance to manage finances, if he or she is incapacitated, without the power of attorney in place, a court appointed guardian may be the only alternative. Power of Attorney documents should be reviewed periodically by an attorney to ensure the document is complete and includes all of the authority that might be necessary.

Review and gather information: make copies of all personal documents, including birth certificates, passports, driver’s licenses, social security and health insurance cards, marriage certificates, death certificates, and military discharge papers. Keep a set of copies in a different place than the originals, so that if one set is lost, you will have the other. Make a list of prescriptions, pharmacy, doctors, attorney, and accountant. If there is a financial advisor or broker, add him to the list.

Make a list of monthly income amounts, and monthly expenses. Automatic bill payments should be considered for convenience. Look at the checkbook register to make sure the record is being maintained, and checks are not being written without being recorded.

Review tax returns from prior years, make a list of all accounts, make copies of the recent statements for all accounts.

Check the activity in the accounts for large withdrawals (especially if your loved one is unsure of account balances). Keep up to five years of statements for all accounts.

These preventative steps can make things easier for your relatives, and less stressful in the future! The attorneys can be reached at 718-738-8500 to schedule a consultation, or a reservation at a seminar.

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