Resource Guide for Family Roles and Experts
Who Can Help?
Building a trusted team of advisors to help with legal, financial and healthcare decisions will help by filling gaps in knowledge where they exist to better create a holistic plan.
Organizes financial affairs, analyzes investments, and makes recommendations for investment strategies aligned with your financial objectives and goals.
Handles annual personal and any business tax filings with an eye towards reducing or eliminating taxes in the transfer of assets.
Estate Planning Attorney
Responsible for ensuring your plans for asset distribution after you die are carried out efficiently, reducing taxes and other costs and avoiding a prolonged review by a probate court. For complex estates, this may require legal opinions on setting up trusts and powers of attorney, which will help you plan for potential incapacity, when you aren’t able to make decisions for yourself because of an illness or disability.
Geriatric Care Manager or Visiting Nurse
Might offer solutions and perspectives when it comes to caring for an aging parent safely and within his or her own home. These professionals can give objective advice and arrange the resources needed to provide the best care for Mom or Dad. They can also help with the difficult decisions necessary when it is no longer safe or feasible for an elder to remain in his or her home.
The Estate Planning Checklist
There are many people involved in an estate plan, including not only family and business partners, but a host of advisors. There will be a financial advisor, an accountant and an estate lawyer, no doubt. Family members or others might be assigned power of attorney or healthcare proxy—people who are legally able to make financial and healthcare decisions if the person is incapacitated. Trustees—either family members, associates or a bank officer—might be appointed to handle a trust established for a grandchild. Here are some basic estate planning tools:
- Will: This is the document that lays out how property and assets are to be distributed after death. It will name the personal representative for the estate, whose role is to handle the distribution of assets, the payment of final expenses, and the court filings. The will may also name guardians for minor children, if any.
- Trust: This is separate legal document that allows for the disposition of assets either during life or at death. A revocable trust means the terms can be changed. An irrevocable trust can’t be changed, but because it transfers the assets irrevocably for the benefit of another, it may hold them beyond the claims of creditors. Trusts also allow for efficient transfer tax planning.
- Attorney-in-Fact: This is someone with the legal authority to make decisions on behalf of another person in the event that person becomes incapacitated. The authority can be broad or limited to a particular asset. The document that grants such power is called a Durable Power of Attorney. There can be more than one “attorney-in-fact.” Some states allow a Durable Power of Attorney for both health matters and financial matters.
- Advance Directives: Even if someone has appointed a healthcare proxy or has named someone as attorney-in-fact for health decisions, an Advance Directive will specifically detail final wishes regarding extraordinary life-prolonging interventions that may or may not be desired.
When it comes to dividing caretaking for an elderly parent, families need to consider the needs and wishes of the aging parent and the abilities and willingness of the adult children who will be doing the caretaking.
Being the oldest adult child doesn’t always translate into being the one with the most financial skills, and being the daughter doesn’t inevitably mean taking on the care duties. Adult children should meet together, with their parents if possible, to talk about who has the ability to take on specific responsibilities.
Sibling rivalries and resentments need to be overcome if harmony is to be obtained. The person who lives closest to the parent often becomes the day-to-day caretaker, but this might not be sustainable for the long term. Adult children may wish to arrange a rotating schedule of roles, or arrange to compensate a sibling who is taking on more of the daily duties.
There are some formal legal roles that often get divided among family members:
- Personal Representative: This person oversees the settlement of a person’s estate, including the division of property and assets as set forth in the will. It is a time-consuming job that requires some financial know-how. The personal representative (also known as an Executor) is the person who collects the assets, pays final bills and funeral expenses, files taxes and submits court documents. Often, a lawyer assists in the process.
Usually, an elderly parent appoints the oldest child to carry out this responsibility, but that person might not be the best person for the job. There can be co-personal representatives, or if the situation is likely to dissolve into a power struggle, an outside party such as a lawyer, banker or accountant can fill the role.
- Healthcare Proxy: This is the person given the legal power to make healthcare decisions for someone in the event that person becomes incapacitated. This person might be named in an Advanced Healthcare Directive, a Durable Power of Attorney for Healthcare, or a Living Will. These documents may also give specific instructions regarding the type and extent of care a person desires at any particular point in time.
- Power of Attorney: This is the person empowered to act under a Durable Power of Attorney. Such a person is granted the ability to make legal decisions and take action on behalf of someone, as spelled out in the granting document. The power to act can be broad or limited to particular assets. A Durable Power of Attorney stays in effect even after a person is incapacitated, but must be put in place while the person granting it still has legal capacity.
It all starts with a conversation.
This workbook can help.
Don’t wait until there's an emergency to have a conversation about the long-term care needs of aging parents. Download this free workbook that helps families begin the conversation.
- Family & Finance
- Financial Planning
- Personal Finance
- Tax Planning
- Trust & Estate