Your Estate … with James Ward – As you age make sure you are still in charge of end-of-life decisions

Published in the November 14 – 27, 2018 issue of Gilroy Life

What happens as you age or your mental health goes downhill? Who do you have in place to make decisions for you? Are they the right people? Can they act now? When will they need to act? How long do you want to have control of everything? Until you die? Until you can’t manage?

A client of mine had been estranged from her two children for several years. Her children were to get everything when she died, but she didn’t want them involved while she was still alive, and I was prohibited from answering any of their questions or providing them with any of her legal documents. She had two friends who she wanted put in charge, and she was adamant that this would work for her. Despite my counsel, this was what she wanted. She was doing “just fine” and didn’t want anyone else involved in her finances until necessary at a later date.

Her plan worked fine while she didn’t require any help, and she still didn’t think she required help when her son called me a couple of years later asking me to get involved with her again to help her. I explained that I couldn’t speak with him until his mother authorized me to do so, and he understood that and told me that if I’d call her, she’d authorize me to speak with him and her grandson.

Why the sudden change of heart? Well, my client had been swindled out of $950,000. Yes! Gone in a flash! And it wasn’t outright theft without her knowledge. She had been scammed into sending the money herself for an investment. She thought that she was wiring the money to a woman in Southern California, but the police told her son that the money immediately bounced to an account in Africa and was no longer recoverable.

When I asked my client whether she had been scammed out of $950,000, she was quite embarrassed and replied, “Well, that’s probably true.” And yes, she now wanted everything changed to have her son and grandson closely involved with her bills and finances and hopefully something like this would never happen again. When was the right time to include her son in her financial decisions? Was there some level of control that could have been set up in advance with her bank or financial advisor?

Most likely, she felt that she was a person who could never be scammed. After all, she owned a few properties and had successfully managed her own finances for years. So what happened? She had sold a property and had money in the bank and was looking for a place to invest it, and “the perfect storm” came together with cash in the bank, weakening mental defenses, and a ready scammer.

How can seniors protect themselves? When is the right time to get others involved? There is no “one size fits all” solution for this. Every person and every family is different.

I had another senior who held his money in 20 different banks. It appeared to me and his family that he was likely entering a period of mental decline, but he was a former accountant and insisted that he was capable of handling everything by himself.

With his wife and adult children close to him and involved in a lot of decisions, he was probably OK to continue on his own, but when do we know in advance that someone is about to make a very large financial mistake?

Consider how much money you can access at one time without getting the consent of another trusted individual. What controls can you place on your accounts to keep yourself from being scammed in the future?

Be smart. Be safe.

James Ward lives in Morgan Hill. He went to law school in New England and earned a post-graduate law degree in Estate Planning at the University of Miami. Jim worked as an Estate Planning and Elder Law attorney in Florida, and then returned to open his law firm focusing on Estate Planning and Elder Law. He has offices in South Valley and Willow Glen.