An Alzheimer’s or dementia diagnosis can be devastating to the whole family. However, there are ways to minimize the negative impact on yourself, your loved ones and your finances. Are you worried about losing control over where you will live, what your life will be like and how your assets will be managed for you?
Where and How Will You Live?
Home sweet home. After all, home is where the heart is. Do you want in-home care, if you can afford it? Alternatively, is there a particular assisted living facility you would prefer, that is in close proximity to your family and friends? If you are ever in a facility, do you want visitors and, if yes, how often? Would you want to spend time outside enjoying nearby parks? You can make these and other choices now, so they will be honored later. However, they should be clearly expressed in appropriate legal documents. At a bare minimum, make sure that you have a current advance health care directive. This will allow trusted loved ones to talk to your doctors, obtain your medical records and advocate for your interests in terms of treatment and day to day care.
How Will Your Assets be Managed?
We have all heard tragic tales of “elder abuse,” particularly when it comes to financial matters. Some of the culprits are strangers, but too often they are someone you know. A general durable power of attorney is essential to empower trusted loved ones to handle routine financial matters from cashing your checks, to paying your bills, to filing your tax returns. Of course, a last will and testament should be executed to express your wishes to the probate court regarding the ultimate distribution of your estate. However, what if you want to avoid probate? If that is your goal, then you might want to consider a different approach that can give you enhanced control over your assets today, tomorrow and even for generations without probate.
Consider a Revocable Living Trust
A revocable living trust (RLT) is a legal agreement that you create to hold title to your assets. You appoint the trustee (asset manager) and the beneficiary. You will normally be the trustee as long as you are able and you are the only beneficiary as long as you are alive. You are the only person who can change the terms of the trust. If you become unable to change the terms yourself, then the trust becomes “irrevocable” and no longer subject to change. Should you get to the point where you are not competent to manage your financial affairs, a successor trustee (previously named by you) can step in and manage those assets, according to the trust terms that you previously established. Even though your general durable power of attorney and advanced health care directive allow you to give “authority” to others so they may act for you, the trust allows you to give that authority along with a mandatory set of instructions for them to follow. That set of instructions you provide can make a huge difference in your quality of life.
Your Life and Lifestyle
Through your custom-designed RLT you can set the rules of the road for your financial life, even if your life includes living with Alzheimer’s or dementia. For example, your RLT can specify that your money be used to pay your adult child to provide care for you in your home, if that is important to you.
As the sage jurist Oliver Wendell Holmes advised, put not your trust is money, put your money in trust. That is advice you can take to the bank.
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