By Quentin Fottrell
"My sister did this to an older friend, at least that's what my parents think."
Caro Quentin,
My father and mother are quite elderly and in poor health, but of sound mind. You have a will and health decision documents. Both are concerned that if one of them dies, my sister, who lives in their town, will take financial advantage of the surviving spouse by emptying bank accounts, amending her will, etc. I live on the other side of the country.
My sister did something like this to an older friend, or so my parents think. (I don't have independent confirmation of this.) I don't think my parents are paranoid.
I am both executor and proxy for the succession if the surviving spouse is found to be legally incompetent. The will distributes the assets equally to the three children. My brother is disabled and unable to participate in decision-making and a special gift will be made to him by will.
My dad wrote me saying he never wanted my sister to have access to his accounts or make decisions about his finances or health care. My mother told me this verbally but not in writing. You don't trust her and neither do I. How do they ensure that their wishes are respected in this regard?
Worried son and brother
Dear Affected,
You already have your wishes written out in black and white: a will, a power of attorney, and a special needs foundation for your brother. A power of attorney – also known as a power of attorney – is essential so that you can make medical decisions on behalf of your parents, should they become unable to do so. According to studies, these documents are less common than wills, but they are crucial for decision-making on issues such as organ donation and requests for resuscitation.
First, a few words of caution for your parents and everyone else. Tell your parents never to give out their Social Security number over the phone, even if the number appears to come from the bank. Hang up and call the bank back. And never read SMS codes back; Your bank will never ask you to do this. In these cases, it is almost always a scammer trying to change the password to access the account. Why do people fall for these obvious scams? Because the number on your phone can actually flash like the name/number of the bank and people get stressed when they are told that they have been victims of fraudulent transactions.
But back to your parents, your sister and you. Neil V. Carbone, a partner at Farrell Fritz, P.C., says this type of situation is not uncommon. "However, there are some steps they should consider to address their specific concerns about their daughter," he says.
"They could revise their existing health powers of attorney to provide additional successor agents, so that if neither the spouse nor the child can act, the next person of their choice (other than the daughter) can act," he says.
"Then they can send copies of the signed documents to their various attending physicians for inclusion in their files," adds Carbone. "You could also include a letter to her doctors explaining that they intentionally didn't name her as an agent and don't want her to act like one."
He said her parents may also return to the estate planning attorney from time to time to confirm that their wishes regarding the will have not changed and to express their concerns about their daughter. "Perhaps a better idea would be to convert your estate planning documents from wills to trust deeds, name your son as a co-trustee of the trusts and fund the funds while the trustees are alive, be involved in administering the trusts and be able to collect unintentional distributions of them." to stop."
It is also important to keep documents and passwords - life insurance policies, bank account details, mortgage documents, etc. - in a safe place to prevent malicious people from accessing these accounts if your parents become disabled. This may also include revocable trust deeds containing assets from your parents' estate to avoid probate proceedings, which can be a public and lengthy process that can also be delayed by family disputes. The trustee can also administer the trust in a timely and efficient manner.
Other areas that are common for disputes include everything from funeral arrangements to naming beneficiaries. Would your parents like a service, would you like to be cremated, buried or otherwise buried? Have beneficiary names been updated to accurately reflect your requests? Family relationships come and go. What about items of sentimental value and real material value? How should they be divided among the three brothers? Your parents may also want to leave your sister a certain amount of money, or at least put her name in the will if she decides to contest it.
It's an uphill battle to contest a will, but family drama can lead to lawsuits and a delay in the probate process. Some states, such as Florida, have a statute of limitations - the amount of time an interested party has to contest a will - although in some states that period can be extended if there is fraud, misrepresentation or wrongdoing. You are right to do so now because another basis for contesting a will is diminished mental capacity. Your parents must complete this process under the guidance of an experienced attorney.
"We are encountering these scenarios more and more frequently," says Carbone. "Unfortunately, actions designed to derail the plans of older clients can often come not just from an outsider like a neighbor or caregiver, but also from a family member trying to get a bigger share of the fortune."
An elderly single parent is at risk, especially when their health is deteriorating. In fact, elder abuse costs billions of dollars annually, and these estimates can vary widely. You can add an "alert" to your parent's bank account that notifies the bank of any named person, also known as a bad person, who must and will never have access to their account.
This study suggests that financial abuse of the elderly is typically perpetrated by family members, trusted friends and caregivers. "But unlike physical abuse and neglect, financial abuse tends to occur with the elder's admission and tacit consent and can be more difficult to detect and verify," she adds.
I hope your worst fears about your sister are unfounded. But if there is cause for concern, these measures should ensure your parents' financial and physical security.
You can email The Moneyist at qfottrell@marketwatch.com for financial and ethical inquiries and follow Quentin Fottrell on Twitter
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04-01-23 0819ET
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