Save Yourself from Your Heirs & Protectors 

FIVE IMPORTANT STEPS

By Diane G. Armstrong, Ph.D.

If a man take no thought about what is distant, he will find sorrow near at hand.

—Confucius (551-479 B.C.)

There are five steps you can take to ensure your personal and financial choices will be honored during your lifetime. Selecting the right attorney, establishing directives for property management and health care, and preselecting your conservator/guardian prior to any “protective proceeding”—all must be done to safeguard your golden years.

(1) WORKING WITH THE RIGHT ATTORNEY Your advance directives will require a Wills, Trusts, or Estate Planning attorney. For help with an involuntary conservatorship/guardianship petition, however, you must consult an Elder Law or Probate attorney who specializes in these proceedings.

            (a) HOW DO I FIND A GOOD ATTORNEY? Ask an attorney you trust for recommendations. Compile a list of candidates for the job and check them out in Martindale-Hubbell’s legal directory.

            (b) WHAT SHOULD I ASK A LAWYER? During a first interview, ask about the attorney’s experience in this field, his/her fee structure, estimates for your total bill, and what information you will be required to provide. For an involuntary conservatorship/guardianship proceeding, ask how your case will unfold, what it might cost, and what the possible outcomes are. Be specific. Do not be embarrassed. If money is a problem, ask for monthly payments. An attorney might even take your case pro bono, for no fee. If you cannot communicate comfortably with the first person on your list, move on to the next.

(2) CREATING DEVICES FOR PROPERTY MANAGEMENT Three devices that will protect your financial affairs should you become incapacitated are: durable powers of attorney, living trusts, and “convenience” joint accounts.

            (a) DURABLE POWERS OF ATTORNEY. A power of attorney is a written authorization in which you (the principal) grant decision-making power to another person (the agent or attorney-in-fact) to act in your place. It has no power to protect you once a court determines you have become incompetent. In contrast, a durable power of attorney becomes effective and continues in effect once your physical or mental incapacity is established. In order to be a durable power, the written instrument must state that it is unaffected by the principal’s future incapacity or incompetence. This durable power may grant general power to the chosen agent (to act for you generally in all matters), special power (carrying rights with respect to a specialized activity), or limited power (a general power with stated limitations). Name one or more trusted individuals to act as your attorney-in-fact, and make sure you include a functional definition of incapacity in the document.

            Durable powers of attorney are vulnerable in one key area: the person you choose as your agent may turn out to be a scoundrel. He or she will be authorized to do anything and everything with your property—including squandering it all—and this fiduciary abuse often goes unnoticed. What can you do? You must review your choices of attorney-in-fact every three to five years and make sure they are still appropriate choices.

            (b) REVOCABLE TRUSTS. A revocable living trust is a trust that can be changed or terminated by you during your lifetime. This inter vivos (during lifetime) method of estate planning permits you to place your property into a revocable trust, administer and invest the trust property, and distribute trust income as you wish. Because it is revocable, you may take assets out of the trust at any time. This trust becomes irrevocable upon your death. Because property can be “poured over” from the creator’s will into the trust (where permitted by law), it can be used as a will substitute.

            (c) DURABLE POWERS OF ATTORNEY IN CONJUNCTION WITH REVOCABLE LIVING TRUSTS. A springing durable power of attorney can be combined with the revocable living trust to provide added protection. The formerly revocable trust, which becomes irrevocable upon the event of your physical or mental incapacity, will be managed by your chosen attorney for your benefit during your time of incapacity.

            (d) “CONVENIENCE” JOINT TENANCIES (ACCOUNTS). You may also want to establish a joint or convenience bank account or certificate of deposit with someone you trust in hopes that that individual will use these funds to take care of you in your time of need. The flaw in this plan is obvious. Since each party to the account is legally entitled to make withdrawals, you will have no guarantee that the joint account will be used as you intended once you have become incapacitated.

(3) FOR HEALTH CARE DECISIONS. Two legal directives permit us to control our personal health care decisions as we age: the durable power of attorney for health care decisions and the living will. Neither device is foolproof. Physicians are often reluctant—or not permitted by state law—to accept a durable power’s authorization for life-and-death decisions, and many simply override the choices in the living will. Ask the attorney who is helping you with property management matters which health care directives you can put in place to control the kinds of medical interventions you might receive. Because medical science is expanding our chance to outlive our bodies—to exist as strong-minded individuals in increasingly fragile containers—we owe this thoughtful deliberation to our future selves.

            (a) DURABLE POWER OF ATTORNEY FOR HEALTH CARE DECISIONS. The durable power of attorney for health care decisions, which appoints an attorney-in-fact to make medical choices for you should you become incapacitated, must be witnessed, notarized and executed when you are competent. It can be a separate legal document or a portion of a larger durable power that also covers property management. It is important to specify the people to whom you would entrust your very survival and to review your choices on a regular basis; and remember that the more specific your health care advance directive, the more likely your wishes will be honored. Because courts tend not to interfere if the proposed ward has already made such arrangements, a durable power for health care can be effective in forestalling conservatorships/guardianships of the person. Seek legal advice concerning the use of such health care devices in your state and, if you move, have your durable powers reviewed by an attorney in the new state.

            (b) LIVING WILLS. Most states permit competent adults to create living wills that direct their health care in specific ways and under specific circumstances. Living wills give directives that initiate or prohibit life-sustaining procedures and clarify the medical conditions under which terminally ill patients would not want to be kept alive. Living wills and durable powers of attorney for health care decisions differ in several significant ways. Living wills are not legally binding and apply only to end-of-life situations. In some states, not all types of care can be refused. Durable powers permit you, the principal of the instrument, to specify the conditions of the power and to name the individual who will make your health care decisions should you become incompetent.

(4) PRESELECTING A CONSERVATOR OR GUARDIAN. The fourth protective step is ironic, but it could one day save your life. It is the preselection of a conservator and/or guardian. If your unwavering goal in making advance directives is to avoid becoming the ward of a conservator or guardian, why should you do this? This preselection or prenomination is needed to avoid two “worst-case scenarios.” In the first, someone petitions the court to have you declared incompetent and you have no advance directives in place. In the second scenario, you have signed your advance directives but a judge decides that a conservator or guardian is just what you need—in spite of all of your careful planning.

            Prepare a list with your attorney that contains at least three names of acceptable conservators/guardians, and make sure your selection of a spouse would be nullified if you are separated or divorced before a surrogate decision-maker is appointed. Do not forget to add an exclusionary clause to prevent individuals you dislike or distrust from ever serving as conservator/guardian of your person or estate.

(5) PREVENTING FUTURE CHALLENGES TO YOUR LEGAL DIRECTIVES. Because durable powers, revocable trusts, living wills and preselection instruments all derive their power from the fact that you are believed to be competent at the moment you sign them, many prudent men and women have begun adding one last step to their defensive legal arrangements. They are videotaping these final legal decision-making sessions in the presence of forensic or geriatric psychiatrists who serve as witnesses to competence and testamentary capacity at the moment each document is discussed and signed. Once this last step is taken, your planning for your incapacity is well and truly done.

Diane G. Armstrong, Ph.D., is the author of The Retirement Nightmare, How to Save Yourself from Your Heirs and Protectors. Published by Prometheus Books. Copyright © 2000 by Diane G. Armstrong. $23. Available in local bookstores or call 800-421-0351 or click here.