Growing older can be difficult. Many people worry about who will take care of them if their mental health starts to decline and they are no longer able to manage their own affairs. Who can they trust to oversee their finances and property? How will they know if they are the victim of fraud or theft?
When a person’s mental abilities are no longer as sharp as they used to be, they become susceptible to abuse. Sadly, there are thousands of people in this world who are willing to take advantage of the elderly and steal their money—even worse, sometimes the source of the financial abuse comes from within the person’s own family.
Fortunately, a person’s finances, property, and other assets can be managed ahead of time with proper planning. By naming a fiduciary and working with an experienced elder law attorney, peace of mind for the future is achievable.
What Is A Fiduciary?
Put simply, a fiduciary is someone who agrees to take on a position of trust for another person. A fiduciary may be in charge of managing assets in a trust, or could be responsible for managing a person’s checkbook. In general, a fiduciary takes care of money issues for another person.
Usually, an elderly person will have a relative like an adult child or a spouse act as a fiduciary on their behalf. If a person does not have any close relatives, he or she may hire a professional fiduciary to act on his or her behalf. A professional fiduciary may be an individual, like an attorney or an asset manager, or an entity, like a specialized fiduciary organization or the trust department of a bank.
A fiduciary has a legal and ethical obligation to manage a person’s finances responsibly. The fiduciary is supposed to carry out the wishes of the person who appointed him or her, and has a responsibility to act in that person’s best interests.
Planning Ahead for the Future
As people age, their needs change. Older people need to plan for their health care, for long-term care, and for the distribution of their assets after death. While no one enjoys thinking about these types of issues, not making a plan can leave family members confused and uncertain about your wishes. If you or your relative is getting older, consider creating a fiduciary relationship to take care of your future needs. Some of your options include:
A living trust manages a person’s assets while they are still alive, in the same way that a will manages assets after a person’s death. A living trust provides many individuals with the assurance that their affairs will be managed according to their wishes.
When this type of document is created, all of a person’s assets are put into a trust for his or her benefit. Everything from bank accounts to real estate becomes part of the trust, which is managed by a trustee. No one but the trustee will be able to access any of the assets (unless the living trust is revoked), which means that even if a person eventually becomes incapacitated, their money and assets will still be managed by a responsible fiduciary.
Power of Attorney
A power-of-attorney document gives a person (the agent) power to make legal and financial decisions on behalf of another person (the principal). The principal can decide how much authority the agent will receive—some people use power-of-attorney forms for only certain decisions, like making health care choices if the principal is too ill, and some people use the power-of-attorney forms to hand over almost all decision-making power. The agent then has a fiduciary duty to manage the principal’s affairs responsibly.
Unfortunately, a power-of-attorney form is not difficult to find on the internet, and many unscrupulous people have tricked the elderly into giving away their legal rights. If you find out that your relative signed an unexpected power-of-attorney form, speak with them immediately. They may not realize what they signed, and you may need to get an attorney or the authorities involved before any money or property is stolen.
When a person is no longer able to take care of themselves, either because of dementia, Alzheimer’s, or another illness, a guardian may be appointed to look after him or her. The guardian may be appointed by the state, or someone with an existing fiduciary duty to the person may be called upon to choose a guardian.
The guardian, like the trustee of a living trust, is in charge of managing all of the incapacitated person’s financial affairs. In addition, the guardian also makes health care decisions and any other decisions necessary for that person’s health and welfare. A guardian has nearly complete controls, much like a parent does for a minor child.
Don’t Wait to Take Control of Your Future
If you are concerned about how your personal and financial issues will be managed as you age, protect yourself by making a plan now. By speaking with a Florida attorney experienced in estate and elder law issues, you can make sure that your assets are protected and your wishes are carried out. Protect yourself today by calling 561.881.6912 and scheduling an appointment at the Law Office of Jonathan M. Galler, P.A.