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Guarding Your Wealth for Senior Citizens
Protect the Ones You Love: Lesson Learned from
Experience of Friends
Advice on what to do to protect your family after
you no longer can
By Jeffrey D. Voudrie, CFP
 Sept. 28, 2007 - Alzheimer’s. Stroke. Heart Attack
- they are words we all dread to hear, especially when they occur to a
loved one. The emotional strain is tremendous. But it can be compounded
if the loved one didn’t take steps in advance to authorize someone to
manage his or her assets. Regardless of your age, it’s imperative that
you have the proper documents in place. Read on to find out why.
My wife and I have a friend who is in a terrible
predicament. Her husband, who is much older than she, had a stroke
almost two years ago. He didn’t have any legal documents in place that
would give her the ability to ‘take over’ if he were incapacitated.
Shame on him! He was a medical doctor and should have known better.
I wish he could see the nightmare his wife is
living with on a daily basis. Initially, she didn’t know anything about
their finances. She had to go through his papers to try and determine
where they had accounts and how much was in them.
But that was just the
start because her name wasn’t even on the daily checking account! She
didn’t have access to any money!
Fortunately, she was able to set up a trust account
for his Social Security check to go into, but that took months to
accomplish. Think of the emotional trauma she was enduring, all the
while trying to care for her husband while being a mother of 3 minor
children. And it all could, and should, have been avoided.
Husbands, you have an obligation to take steps to
provide for your wife in the event that something happens to you. Don’t
keep them in the dark about your finances. They need to know where you
have accounts. Keep a list and/or copies of statements in a location
that she knows about. Always maintain at least one checking account with
both of your names on it with enough funds to cover three to six months
worth of expenses.
There are additional steps you need to take. If
both husband and wife’s names aren’t on all the accounts, then be sure
there are the legal documents in place that allow the other to manage
that account if necessary.
If you are single, it’s even more important to take
steps now. You need to have the legal documents in place naming the
person you would like to handle your finances in the event you can’t.
You need to let that person know where you will keep the important
papers, account statements, etc.
There are two different documents that can be used
to grant someone the authority to manage your assets for you without
granting them ownership. One is a financial Power of Attorney. The other
is a Living Trust. Nowadays, both can be obtained easily and
inexpensively.
The Living Trust, in my opinion, is by far the best
choice. Living Trusts are like buckets you put your assets in so you can
control how they are managed during your lifetime and at your death. You
still have complete control and can buy and sell and invest just like
before.
But should you suffer a stroke or pass away, you decide how your
assets will be handled. Depending on what’s stipulated in the trust,
your successor trustee may only need two letters signed by your doctors
and a copy of the trust to present to your bank or other financial
institutions. That’s it.
A financial Power of Attorney also allows you to
grant someone the authority to manage your assets. You determine whether
they have control immediately or only when you become incapacitated.
I’ve heard of situations where a bank wouldn’t
honor a properly drafted power of attorney because it was over 6 months
old. The person had been incapacitated for years so she couldn’t sign
another one! In these situations a lawyer would be needed. If you rely
on a Power of Attorney, you might want to keep it relatively up-to-date.
After two years, my friend is still fighting
battles that have resulted from her husband’s lack of action. Frankly,
she’s going through hell. Don’t let this happen to the ones you love. I
know it’s easy to put off. But unless you choose to make it a priority,
it won’t get done.
If you have a specific question or would like more
information, give me a call toll-free at 1-877-827-1463 or you can also reach me by email at
jeff@guardingyourwealth.com.
I will answer your financial question FREE.
About Guarding Your Wealth:
“Guarding Your Wealth” is a
nationally syndicated weekly personal finance column written by Jeffrey
D. Voudrie, CFP. Mr. Voudrie is the President of Legacy Planning Group,
a private wealth management firm that employs sophisticated proprietary
strategies designed to protect and grow its clients' investments. Visit his website,
www.guardingyourwealth.com to read past articles under the Guarding
Your Wealth Article Archive that may not have appeared in
SeniorJournal.com.
Guarding Your Wealth for Seniors, on
SeniorJournal.com, is
a collection of columns by Voudrie that deal with issues of particular
interest to senior citizens.
Click here
for all columns.
In addition to being a nationally
syndicated columnist and Certified Financial Planning Practitioner, Mr.
Voudrie provides personal, private money management services to select
private clients
nationwide.
Looking for an energetic expert who
is passionate about financial and wealth management? Mr. Voudrie is an
excellent speaker who will excite and inspire your audience. Mr. Voudrie
is available for a limited number of speaking engagements, television
appearances and radio talk shows. For bookings, email
jeff@guardingyourwealth.com.
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