The Three Biggest Senior Estate Planning Blunders
One typical flaw elder law attorney’s see in seniors’ estate planning is having the wrong type of durable financial power of attorney. That is, most seniors think that their estate planning financial power of attorney will allow their agents to do whatever they need them to do, if they become incapacitated.
Regrettably, this is usually not the case when seniors are in need of long term care. The reason for this, is that a financial power of attorney focused on estate planning rather than on elder law, rarely includes powers that allow an agent to divest the senior of his or her assets in favor of asset protection planning, so that the senior can avail themselves of Medi-Cal and/or Veteran’s Pension benefits. This one misstep alone has resulted in impoverishment for countless seniors who ended up needing long term care.
The second most damaging mistake that seniors make is not being vigilant in updating their estate plan. For example, creating an ongoing trust as well as nominating guardians for kids is critical for younger couples. For people in the prime of their lives, an estate plan focused on probate and conservatorship avoidance is key. But these plans typically do nothing to protect a senior’s assets from long term care costs. Also, many couples who did estate planning prior to January 1, 2018, still needlessly have ABtype trust plans which result in extra administration, headaches and costs. What’s worse, is that these plans could unwittingly result in unwanted “gifts” to the government if a senior later needs help paying for long term care. All of this is to say nothing about changes in family dynamics that warrant changes to an estate plan. Really, an entire book could be dedicated to highlighting the adverse effects of outdated planning.
But, by far, the biggest blunder that a senior can make when it comes to estate planning is simply ignoring it, in the first place. Addressing questions about asset protection, who gets what of your assets (and how they get it) after you are gone as well as who is in control of your financial and/or health care decisions, if you become incapacitated, is essential. The devastating effects caused by a lack of planning (or bad planning) oftentimes leads to bankruptcy, unnecessary and costly court proceedings, higher taxes, disinherited beneficiaries and/or battles between loved ones that forever rip families apart.
To ensure peace of mind for your loved ones, contact Randall F. Kaiden, Esq., at Kaiden Elder Law Group, PC to set up an Estate Plan at 661-247-8433, or via our website: www.kaidenelderlaw.com.
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