The Wiewel Law Firm

Five Estate Planning Mistakes to Avoid

“Five of the most common mistakes are easy to avoid with the right information and support, as well as a little creativity.”

While it’s true that no estate is completely bulletproof, there are mistakes that people make that are big enough to walk through, while others are more like a slow drip, draining retirement finances in a slow but steady process. There are mistakes that can be easily avoided, reports Comstock Magazine in the article “Five Mistakes to Avoid When Planning Your Estate.”

1. Misunderstanding Estate Law. Some people are so thrown by the idea of an estate plan, that they can’t get past the word “estate.” You don’t need a mansion to have an estate. The term is actually used to refer to any and all property that a person owns. Even modest people need a plan to help beneficiaries avoid unnecessary costs and stress. Talk with an estate planning attorney to learn what your needs are, from a will to trusts. Make sure that this is the attorney’s key practice area. A real estate or personal injury attorney won’t have the same knowledge and experience.
2. Getting Bad Advice. It takes a team to create a strong estate plan. That means an estate planning attorney, a financial advisor and an accountant. Be wary of firms that focus entirely on selling trusts. There’s definitely a role for trusts in estate plans, but there are many other tools that are needed. Buying an insurance policy or an annuity is not an estate plan.
3. Naming Yourself as a Sole Trustee. Naming yourself as a sole trustee puts you and your estate in a precarious position. What if you develop Alzheimer’s or are injured in an accident? A trusted individual, a family member, a longstanding friend or even a professional trustee, needs to be named to protect your interests, if you should become incapacitated.
4. Losing Track of Assets. Without a complete list of all assets, it’s nearly impossible for someone to know what you own and who your heirs may be. Some assets, including retirement funds, life insurance policies, or investment accounts, have named beneficiaries. Those people will inherit these assets, regardless of what is in your will. If your heirs can’t find the assets, they may be lost. If you don’t update your beneficiaries, they may go to unintended heirs—like ex-spouses.
5. Deciding on Options Without Being Fully Informed. When it comes to estate planning, the natural tendency is to go with what we think is the right thing. However, unless you are an estate planning attorney, chances are you don’t know what the right thing is. For tax reasons, for instance, it may make sense to transfer assets, while you are still living. However, that might also be a terrible idea, if you choose the wrong person to hold your assets or don’t put them in the right kind of trust.

Estate planning is still a highly personal process that depends upon every person’s unique experience. Your family situation is different than anyone else’s. An experienced estate planning attorney will be able to create a plan and help you to avoid the big, most commonly made mistakes.

Reference: Comstock Magazine (Dec. 2019) “Five Mistakes to Avoid When Planning Your Estate”

Having That Conversation with Your Parents

“Talking about money is hard. Talking to your parents about their financial situation can be even harder.”

Despite any uncomfortable feelings, the sooner you start talking with your parents about their financial situation, and the more conversations you can have, the better, says Wisconsin Public Radio in the article “How To Talk To Your Parents About Their Finances.”

The goal is to get the conversation and the work done before it’s too late. If you wait until Alzheimer’s has taken hold, for instance, you may be out of time. For one woman, whose mother was diagnosed with Alzheimer’s at 65, the realization that she had to act fast was followed immediately by a swift set of actions.

After the diagnosis, she became her mother’s power of attorney. If that hadn’t happened, her mother would not have been considered legally competent to make that decision. That would have led to a legal nightmare, including asking the court for guardianship.

The daughter had to step in and take over the entire financial picture, with little help from her mom. It was a challenge that came with many lessons that are shared here.

The conversation isn’t just about money. There are many issues that need to be discussed. What does retirement look like? Do the parents want to stay in their current home, or will they want to downsize in their current community? Do they see themselves moving to live near grandchildren? What kind of care do they expect to need, and where would they want to receive that care? Be gentle, and remember that you are asking the people you love to explore sensitive topics that are likely to be hard to consider. And don’t give up if they push back. If one approach doesn’t work, try another.

Try storytelling. Maybe you had a family member who didn’t do any planning and left a disaster behind that has become part of your family’s collective history. “Remember Uncle Alan and what his nephew went through after he died?” might bring up some painful memories, but it is a starting point. “While the family was grieving his loss, a few family members couldn’t think of anything but the headaches that were created,” and express your hopes that you can help them from leaving that situation for their own children.

Make a list of bills to start. If there were an emergency and you had to take over everything, with no prior notice, a list of bills would be helpful. You want to get a list of their monthly and quarterly bills and then learn where the money to pay those bills comes from. Are they relying on Social Security, is there a pension, are there any IRA or SEP distributions? Do they have a mortgage, or credit card debt? Some parents may be reluctant to hand that information over. An alternative is to have them write down all of their information, including website accounts and passwords, and put it somewhere in the house and tell you where the list is. At least that way you can access it, if need be. If you’re not sure if they will actually do this, take a look while you are visiting to make sure the list is where they said it would be.

Another way to have this conversation is to go with them to an estate planning attorney’s office, when they have their wills, power of attorney, and health care proxy forms done. The conversation may be easier when it is taking place on neutral territory, as part of a larger conversation about their plans for the future.

Reference: Wisconsin Public Radio (September 2, 2019) “How To Talk To Your Parents About Their Finances”

The ER Can Be a Major Challenge for Alzheimer’s Patients

Start planning long before a visit is needed.

Careful planning can often help patients with Alzheimer’s to be more relaxed and comfortable, if the day comes when a trip to the emergency room becomes necessary, according to The Advocate in “Alzheimer’s Q&A: What should I know before taking someone with Alzheimer’s to the emergency room.”

Start long before you must go to the ER, by creating a list of your medications and have a few copies with you. Bring the medication list and any assistive devices, including hearing aids, dentures, an extra pair of glasses and any walking aids, like a walker or a cane.

 You should also have a list of contact information for all healthcare providers and family members. If you have a power of attorney, bring that as well. If the individual has an advance directive or any other documents, like a do not resuscitate (DNR), bring those just in case. Make sure to have all health insurance information.

Expect a wait, so bring snacks. A portable music player with the person’s favorite soothing music and headphones may provide some comfort. Magazines or books that are used during quiet times at home may be useful. Don’t bring anything of value, like jewelry or a wallet. And don’t bring a crowd. Small children, unless there is no one who can care for them, or other family members, are best left at home.

Unless the individual is having a life-threatening emergency, you will likely have to wait, and you may be waiting a while. Provide simple step-by-step explanations of what is taking place and be honest with them about why they are in the hospital and what is happening.

Focus on keeping them calm and comfortable. Offer a snack and if possible, find a quiet space in the waiting room.

Make sure that the hospital staff is aware you are there with a person who has Alzheimer’s or dementia. They may not have training in caring for dementia patients, so be prepared to advocate for your parent or loved one. Offer suggestions in communicating with the person and ask doctors and medical personnel to limit their questions, which may increase stress and anxiety. Speak with the doctor privately, if possible.

Reference: The Advocate (Jan. 20, 2019) “Alzheimer’s Q&A: What should I know before taking someone with Alzheimer’s to the emergency room”

Some Common Estate Planning Mistakes Best Avoided

What might happen if you have the talent for success but not the talent for business?

As can often be the case, many extremely talented people accumulate large estates and they often are not prepared to take on the task of organizing the transfer of assets, according to the Reno Gazette Journal in “Yes, even celebrities make estate planning mistakes.”

Here are the top four biggest mistakes:

No will. Biggest names: Prince, Aretha, Amy Winehouse and that is just a few. That means your affairs aren’t in order and your loved ones are not protected. Winehouse left an unwritten song about her finances, but she also left a $6.7 million estate. She had a brother and an ex-husband, but no direction as to who should get what. Without a will, her estate went through the probate process and was distributed to her parents. You need to have a will to name guardians of your minor children and ensure that your assets are distributed, according to your wishes.

Not setting up a trust. Celebs want their glamorous red-carpet photos all over Instagram and Facebook, but that doesn’t mean they want their personal finances to become public record. A will is a public document and a living trust keeps things private. There was more than one tragedy that followed Whitney Houston’s death. Her will named Bobbi Kristina Brown as her sole beneficiary. However, her daughter died three years later. Then her estate was tangled up with an IRS battle over the valuation of recording royalties. The bill from the IRS: $2.2 million in additional taxes. Her ex, Bobby Brown, may yet end up the heir of the Houston estate. That may not be what Whitney wanted.

A living trust keeps your estate private. It designates who is entitled to your assets, and how they are to receive them. It names trustees, and may provide tax benefits.

Not keeping the plan up to date. Life is all about change. Financial conditions, health, family relationships, divorce, marriage, birth, adoptions, estrangements: everything changes. The world-famous author Michael Crichton, author of Jurassic Park and many, many other best-sellers, was diagnosed with throat cancer, when his sixth wife was pregnant. His will was not updated. She had to sue to include the baby as an heir, and a daughter from a prior marriage opposed it. The judge ultimately ruled that the baby should inherit. However, simply updating his will would have taken care of everything, minus the resulting stress, cost and rancor.

Disabled before death. Estate planning is for the living also. You may be disabled and need help in managing your financial affairs. One out of 10 people over age 65 are diagnosed with Alzheimer’s disease, then at age 85, the rate skyrockets to one out of three. One celebrity whose dementia led to a nasty family rift was Etta James, the blues singer best known for the classic “At Last.” She had signed power of attorney over to a son from a prior marriage in 2008. Her husband of more than 40 years said that she was already suffering from dementia and was not competent to sign any legal documents. The son wanted to limit the amount of money the singer’s husband spent on her medical care. They finally settled, and her husband was named as conservator. However, he was given a limit of $350,000 for care for his wife. Etta James passed away shortly thereafter.

Celebrities are not the only ones who make enormous mistakes, when it comes to estate planning. However, they are the ones that we read about.

An estate planning attorney can advise you on creating an estate plan that fits your unique circumstances and can help you avoid those costly mistakes.

Reference: Reno Gazette Journal (Nov. 14, 2018) “Yes, even celebrities make estate planning mistakes”

Children Can Contest Glen Campbell’s Will

The challenge will be to prove that Campbell, who was diagnosed with Alzheimer’s disease, lacked the capacity to execute the wills.

Three of Glen Campbell’s children, who were intentionally left out of his will, have been given the right to contest the will by a judge, according to Wealth Management.com in “Glen Campbell’s Kids Come After the Rhinestone Cowboy’s Estate.”

Campbell, who recently passed away, left two wills from 2001 and 2006. The 2006 will names Campbell’s fourth wife Kimberly, who is the executor of the estate, and five of Campbell’s other children as his beneficiaries. Campbell went public with his Alzheimer’s diagnosis in 2011.  However, it’s not known how far back his illness began. The legal burden facing his children: prove that he lacked the needed capacity to execute both wills.

If the will is deemed invalid because of lack of capacity or undue influence, the immediately preceding will is resurrected, said one estate planning attorney who is not affiliated with the case. The previous will probably disinherited them also, which is why they must prove the invalidity of both wills.

Kimberly has told a local newspaper that she would not challenge the kid’s right to contest the wills and the judge’s decision noted the lack of opposition. She has also filed a claim seeking reimbursement from the estate for more than $500,000 to cover the cost of his medical care.

It was also reported that one of his daughters, Debbie Campbell-Cloyd, has filed for a complete accounting of all payments made by the estate, as well as payments to and from a previously undisclosed bank account. She alleges that royalties that should have been deposited into an account controlled by Campbell’s estate, were instead deposited into this account, which is now controlled by Kimberly. The singer’s former manager has power of attorney over the account.

An estate planning attorney can advise you in creating an estate plan that fits your unique circumstances and may include a blended family.

Resource: Wealth Management.com (Aug. 2, 2018) “Glen Campbell’s Kids Come After the Rhinestone Cowboy’s Estate”

False Alzheimer's Diagnosis Sparks Lawsuit

A clinic in Ohio, which is now closed, is being sued for falsely diagnosing clients with Alzheimer’s and then treating the disease.

A number of patients of an Ohio clinic may have intentionally been given a false diagnoses of Alzheimer’s, according to FOX News in "Clinic falsely told dozens they had Alzheimer's, suits say."

Many people fear the worst when they forget something, because they are absent-minded and then seek medical help because they fear that they are coming down with Alzheimer's disease. Many patients of the now closed clinic in Ohio, have sued the clinic because they claim they were given a false diagnoses.

The clinic told them they had the disease and accepted their payments for treatment. It was later revealed that these diagnoses were false and it appears that the clinic's director did not have a license to practice medicine in Ohio.

If these allegations turn out to be true, this is a brazen and disturbing case of elder abuse. One of the people affected, even committed suicide.

People are right to consider they may have a debilitating disease but they should also have confidence that the diagnosis is accurate.

Reference: FOX News (Feb. 8, 2017) "Clinic falsely told dozens they had Alzheimer's, suits say."

What If You Can’t Care for a Real Animal? Robotic Pets!

Robotic cats may be answer to providing companionship for Alzheimer's patients.

The New York Times discussed a new trend in providing companionship for patients unable to care for real animals in "Therapy Cats for Dementia Patients, Batteries Included."

One way to combat the problem of providing therapy animals to lonely patients with Alzheimer’s disease and other forms of dementia, may be available through robotics.  They have become good enough and cheap enough that some commercially available robotic pets could have benefits for patients with dementia.

Therapy animals have sometimes been used, but even with specially trained dogs and cats, there is still a safety risk for many patients and the animals themselves. In addition, real animals have to be cared for and fed, which takes up caregiving time.

The article discusses their use in one nursing home where the residents really enjoy the robots. They give a sense of joy and empowerment, even when the patients realize that the robots are not real animals.

Reference: New York Times (Dec. 15, 2016) "Therapy Cats for Dementia Patients, Batteries Included."

Odor Could Lead to Breakthrough in Alzheimer's Diagnosis

The smell of urine could lead to an early diagnosis of Alzheimer's Disease. Currently there is no way to make a determination until the symptoms are discovered.

If a diagnosis of Alzheimer's Disease could be made before someone begins to show symptoms of the disease then decisions could be made by the patient before they are incapacitated.

Early diagnosis is important not just for treatment, but also to allow someone to get his or her affairs in order before the disease takes its toll. Estate plans, wills, guardians, powers of attorney and living wills must all be done before the person becomes incapacitated.

However, diagnosis of Alzheimer's has proven to be elusive.

Medical Express reports a positive development in "Odor biomarker for Alzheimer's disease."

Researchers have discovered in studies of mice that urine has a distinctive smell in specimens with pathologies that mimic Alzheimer's. This smell can be detected even when no actual symptoms of Alzheimer's are present. While this research is still in its infancy there is a possibility that it could result in a test that could be used to diagnose Alzheimer's in humans.

Reference: Medical Express (Jan. 14, 2016) "Odor biomarker for Alzheimer's disease."

Planning for Alzheimer's

Every year, people in the United States spend millions of dollars to treat and care for Alzheimer's Disease. As people continue to live longer and longer than ever before, even more money is projected to be spent in the future. This means that everyone should make plans as if they will get the disease.

Alzheimer's is a scary disease for most people. It strikes at the core of who we think we are. People with the disease often forget their friends and family members.

Anyone who has ever known someone with Alzheimer's knows how frustrating this disease can be for the patients and their loved ones. A recent article in UT San Diego, titled "Legal, financial planning for Alzheimer's patients," details some steps people can take to be prepared should they or their loved ones ever get the disease.

The key thing to know is that you need to prepare ahead of time.

People with dementia normally lack the capacity to sign legal documents. That means you cannot make plans after you get Alzheimer's. If you wait, then a court might be required to make plans for you.

The basic documents you need to prepare in advance (i.e., right now) include a general durable power of attorney and a health care power of attorney. These two documents allow someone of your own choosing to handle your financial and health care matters when you are no longer able to do so.

While you are at it, make sure you have an up-to-date estate plan (i.e., a last will and testament, or revocable living trust), to provide for the efficient transfer of your assets upon your death. Your beneficiary designations should be reviewed, too.

If you or your loved ones have not yet planned for the possibility of Alzheimer's, then visit an experienced estate planning attorney without delay and get everything in order.

Reference: UT San Diego (October 23, 2014) "Legal, financial planning for Alzheimer's patients"

Police Commission To Look Into An Inheritance?

It is not often that a police commission announces an official probe of an individual police officer's inheritance. When it does happen, you can bet there is an interesting story behind it. A recent case in New Hampshire does not disappoint.

In 2009 Geraldine Webber made a will to divide her estate. This will left one-fourth of her estate to each of Portsmouth, New Hampshire's fire and police departments. In addition, a couple of charities were each designated to receive $500,000. Webber's disabled grandson also was named a beneficiary. In 2010, Webber was diagnosed with dementia. However, in 2012 she made a new will. That will gave $2.7 million to a single police officer, Sgt. Aaron Goodwin. He was not named as an heir in the original will. In an article titled “Police Commission authorizes probe of Goodwin's inheritance,” Seacoast Online provides the full story. The police commission has announced that once litigation over the estate ends, it will officially look into the circumstances of Goodwin's inheritance.

While it is not common for a police commission to look into a single inheritance, the underlying issue in the case is quite common. When someone who has been diagnosed with dementia creates a new estate plan, litigation frequently ensues over its terms, especially if the terms of the plan have been changed substantially. Why? Because a person must be mentally capable of creating a will, even though a person with dementia can make a new will. In some cases it is necessary because of changing circumstances. However, it is important that those who stand to inherit under the old will are informed of the new circumstances and why the will is being changed. Taking that key step can help to avoid costly litigation.

When making a will or making a new will, be sure to consult with qualified legal counsel sooner rather than later.

 Reference: Seacoast Online (July 28, 2014) “Police Commission authorizes probe of Goodwin's inheritance”