Massachusetts Estate Planning and Elder Law » Retirement Planning

You Have a Plan in Mind, but Do You Have a Plan in Place?

Leanna Hamill — Fri, 25 May 2007 15:31:41 +0000

I was speaking with someone from the Planned Giving Department of the Salvation Army today. She was relaying the story of a woman who wanted to leave a donation to the Salvation Army in her Will. She had an old Will that left her money to some nieces and nephews, she also had several bank accounts that named one niece as the beneficiary on the account (the person who was to receive the money upon her death), and she had a hand written note listing who she wanted her money to go to, including the Salvation Army.

Despite her wishes to leave a bequest to the Salvation Army, she never saw an attorney to make sure that her plans would be carried out.

When the woman died, all of her accounts were automatically payable to the one niece listed as the beneficiary. The other nieces and nephews listed in the Will inherited nothing, since the funds passed outside the Will. This has lead to problems in the relationships between the cousins, which could have been avoided had the aunt understood that her Will would not adequately provide for them. In addition, because she never formalized her plans, there was no money to leave to the Salvation Army. Thankfully, the niece found the handwritten note and voluntarily made a donation in her aunt’s name, but she was under no obligation to do this and there was no guarantee that the niece would have found the note, let alone chosen to make a donation.

It is good to have a plan in mind, but after you make your plan, you need to see an attorney to make sure that your plan will actually be carried out the way you intended.

Organizing Your Financial Life – Month by Month

Leanna Hamill — Thu, 04 Jan 2007 16:10:46 +0000

January is a great time to get organized and make plans for the year. Attorney Joel Schoenmeyer, who writes the Death and Taxes Blog in Chicago, has a recent post called Organize Your Financial Life in 2007. He lays out, month by month which tasks you should tackle such as making an appointment with a financial planner, meeting with your accountant, getting your taxes in order, opening a safe deposit box, reviewing your insurance policies, and more.

However, he puts estate planning all the way in October. I have to recommend that at least part of your estate plan – the Durable Power of Attorney – be done in the beginning of the year. Then if something happens to you, the person you have named as your agent can continue to organize your financial life and manage your affairs for you.

New Year’s Resolutions

Leanna Hamill — Fri, 29 Dec 2006 17:33:23 +0000

People make New Year’s Resolutions about a lot of things – getting in shape, stopping smoking, getting organized, drawing up their Will and other planning documents. And just as your personal trainer can give you information about the best way to get in shape and guide you on your way, your doctor can offer assistance in stopping smoking and your local organizing whiz can help you find the best way to manage your paper – your attorney can help you figure out the best way to form your estate plan.

Don’t be afraid to contact your attorney and say "I know I need to have an estate plan, but I don’t know what I need and I’m not sure how to distribute things." That’s OK. I have many clients who call up with the same concerns. The initial meeting with my clients involves gathering a lot of information from them, and asking a lot of questions to help them form in their own mind what they want. Through the questions I ask, they can figure out who the best person is to serve as their agent under a Durable Power of Attorney, who they should appoint as guardian for their young children, or as trustee of their trust. And through our conversation, we can decide if they just need a will, or if a trust of some sort would work best for them.

So, give your personal trainer a call and let him know your fitness goals – he can help you get there. Then, make an appointment with your attorney and let her know what your goals are for your and your family’s future – and she can help you get there.

Managing Your Parent’s Finances

Leanna Hamill — Fri, 01 Dec 2006 18:18:48 +0000

If you find yourself in the position of having to take over the management of your parent’s finances, this recent article by Bankrate is a good place to start. It lists the 8 steps you should take:

1. Find All of Your Parent’s Financial Accounts and Documents
2. Collect and Start Paying Bills
3. Locate Power of Attorney or Living Trust
4. Open Your Parent’s Safe Deposit Box
5. If There is No POA or Living Trust, Become Your Parent’s Guardian
6. Document Everything You Do On Your Parent’s Behalf
7. Consider Hiring a Financial Planning Team
8. Consider Updating Your Parent’s Investments

If your parents are still able to manage their own finances, but may need some help down the road, encourage them to have a Durable Power of Attorney or Living Trust drawn up, so that you will be able to assist them when the time comes.

Without a DPOA or a Trust, it may be necessary to pursue a guardianship or conservatorship if your parents become unable to care for themselves and their financial affairs. This is a costly and often emotional process because it involves having your parent declared unable to care for themselves, and involves the Courts. With a DPOA or Trust, your parent gets to choose who they want to appoint as their agent, and the agent can act at any time with the parent’s permission, or when the parent becomes unable to act for themselves.

And while you are at it, don’t forget to have your own Durable Power of Attorney or Trust drawn up so that your children can assist you when the time comes…

Assisted Living and Continuing Care Retirement Communities – What’s the Difference?

Leanna Hamill — Tue, 21 Feb 2006 16:32:53 +0000

Seniors, and their families, who are researching housing options may see different terms describing the residences. Assisted Living Residences and Continuing Care Retirement Communities are two of these options. What do these terms mean, and how do you know which is right for you?

Assisted Living Residences
Assisted Living Residences (ALRs) provide a combination of rental housing, meals and personal care services to adults. ALRs are not designed for people with serious medical needs and are not licensed as nursing facilities. They are intended for people who may need assistance with dressing, bathing, meal preparation, and medication reminders (ALR staff cannot administer medication, but they can remind the resident to take their medication.

ALRs operating in Massachusetts must be certified by the Office of Elder Affairs and meet the requirements set forth in MGL ch 19D, and 651 CMR 12.00 et seq. The Office of Elder Affairs provides a listing of ALRs in Massachusetts, as well as the certification requirements for assisted living service providers.

Continuing Care Retirement Communities
Continuing Care Retirement Communities (CCRCs) are a unique kind of senior housing option. In addition to the housing and personal care provided by ALRs, CCRCs also provide health care services as needed by the resident, allowing the person to "age in place" and not have to move if they require more services.

CCRCs can vary greatly in terms of…

…the services they provide, so it’s important to inquire which services are included in the monthly fee (which can range from $700 to $3000/month) and which are charged separately. In addition, most CCRCs require a large entrance deposit, which can be several hundred thousand dollars. You should inquire how much of this deposit is refundable, and under which circumstances.

The health care services provided at the CCRC may be covered by prepaid insurance that is included in the monthly fee, or by your own medical insurance. You should find out if you will be able to continue to see your own doctor, and hire your own in home care providers if necessary, or if you will be required to use their doctors and other providers.

The Office of Elder Affairs has listings of CCRCs, guidelines for who should consider CCRCs, as well as issues to consider when choosing a CCRC.

Things to Consider When Reviewing ALRs or CCRCs
Regardless of which option you are selecting, you should always visit the facility, more than once if possible. Feel free to drop by unannounced and ask for a tour. Even if no one can give you a tour at that point, you will be able to see how you are treated, and you’ll see the other residents and what they are doing. When on the tour ask about security, if pets are allowed, what the emergency procedures are, and see how the staff and residents interact. Also, pay close attention to the vibe you get, your gut is not usually wrong.

In addition, before you sign a contract of any kind and hand over a deposit, you should always have it reviewed by your attorney. The ALRs and CCRCs have attorneys working to make sure their intersts are protected, and your attorney is there to look out for yours.

Naming Beneficiaries on Retirement Accounts

Leanna Hamill — Fri, 10 Feb 2006 19:51:01 +0000

I was talking with my financial planner the other day, and he remarked that he often sees people who have taken the time to put a financial plan together, but then fail to name beneficiaries on their accounts. The beneficiary is the person to whom the account will be paid upon the death of the account holder. The account will be paid over to that person outside of the probate process, which means the beneficiary will receive the money a lot sooner than if no beneficiary is named and the property has to pass through the Will, or through intestacy (if there is no Will.)
Take a few minutes to make sure you have named beneficiaries (and contingent beneficiaries) on all of your retirement accounts. You can name multiple beneficiaries if you are leaving the account to more than one person.
If you aren’t sure whether you’ve named beneficiaries, contact your financial adviser or the company where your account is held. A few minutes now can save your loved ones months of time later.