Finding Fiduciaries

Baseball Hall of Famer Bob Lemon said that the “two most important things in life are good friends and a strong bullpen.”

Lemon was a great pitcher and not an estate planning attorney. However, he may have been onto something, especially when it comes to choosing someone to handle your financial matters in the event of your incapacity or death.

You want to make sure that you have a strong bullpen when it comes to managing your finances should you become incapacitated, administering your estate at your passing and then distributing what is left to your ultimate beneficiaries as you direct. The same person is often appointed to be responsible for all of this managing, administering and distributing. But who should that person be?

The Usual Lineup

The first people who we ordinarily consider are those closest to us – our own family members. As you go through life, this lineup can include parents, relatives, spouses and adult children.

Family members are the natural choices for a variety of reasons. After all, they know and care about you and your immediate family. What they lack in legal, financial and tax expertise, they may make up for with integrity and common sense. In short, they will not steal from you and yours, and they will know when to get professional assistance to carry out their duties.

On the downside, you may not have any family members with integrity and common sense. Even if they do, will they have the time required to ultimately fulfill all of the legal, financial and tax responsibilities? This is a lot to ask of someone and it can also change family relationships. If Uncle Bob must refuse his nephew’s request to purchase a shiny red sports car, then that can change their family relationship forever. Uncle Bob could also become incapacitated or die himself.

Consider Professional Help

If the downsides of having family members as your financial backups outweigh the upsides, perhaps you might consider going with a professional. Some accountants and attorneys may serve in the managing, administering and distributing roles. Corporate trustees are another alternative.

One of the main advantages is their “independence” from family relationships and emotions. A third-party professional will follow your estate planning instructions and have no hesitancy when it comes to denying the request for a shiny red sports car.

However, a non-family member professional will be on the clock and time is money. Nevertheless, the services provided for a price by the professional would still need to be provided by a family member or someone they hired. In the end, the professional might just be the “closer” you need in your bullpen to ensure victory in late inning play.

Double Team Approach

Alternatively, when it comes to the “bullpen” that manages your finances, administers your estate and distributes the inheritance, consider combining the trusted family member with the competent expertise of a professional third-party. That way your family member can see to matters of the heart, while the professional minds the legal, financial and tax matters.

© 2017 Integrity Marketing Solutions. All Rights Reserved.

Alzheimer’s: Staying in Control

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.

© 2017 Integrity Marketing Solutions. All Rights Reserved.