Many people are hale and hearty throughout their whole lives, but many more suffer health problems as they age that make it difficult to continue to perform tasks that were once easy. It’s not uncommon for older Southern California residents to get to a point where they cannot or do not want to handle finances effectively.
Incapacity is possible due to illness or accident at any age. Anyone can be placed in a position where financial and medical decisions are impossible to make. Powers of attorney – written estate planning documents – allow individuals to select fiduciaries or legal representatives to make decisions for them. The relationships are bound by trust that the chosen party will act solely on the individual’s behalf rather than for personal gain.
Trust cannot be emphasized too strongly in matters that involve the financial security of an elderly person. Research from the National Committee for the Prevention of Elder Abuse and a major insurer found that U.S. seniors were bilked out of nearly $3 billion in 2010.
Elderly people, especially ones who live alone, are easy financial crime targets. How many stories have you read about fly-by-night contractors taking seniors’ money for home repairs and never doing the job? Unfortunately, some people that an older person trusts blindly – friends or relatives – may also take advantage of easy financial access.
Estate plans discourage elder abuse. Decisions about fiduciary responsibilities and asset distribution can be made when an individual is mentally and physically sound. Estate planning documents seamlessly cover financial management matters during incapacity and after death.
Elderly financial abuse is widespread. A financial planners’ survey conducted last year found that 56 percent of older clients had been deceived or unfairly treated in money matters. Additionally, only about five percent ever reported the abuse.
An estate plan helps close the window on opportunities to rob you and your heirs of wealth.
Source: sacbee.com, “How to prevent elderly financial abuse on another’s behalf” Claudia Buck, Nov. 11, 2013