H. Frances Reaves, ESQ.

Transparent Finances

As I've discussed in several articles the discussion of money is a must but can also be a monster rearing its ugly head. We've discussed Powers of Attorney, Wills and Trusts but we haven’t discussed who to choose as your agent, executor or trustee. 90% of the time the elderly choose their children and 60% of the time that’s a good choice. I was the agent for my parents with my brother as a second. And, although my brother did not ask or question my “agency” I set up all of Mother and Dad’s money in both our names, I did this to be transparent – to my siblings and myself. It also allowed for shared responsibility and shared communication.

Although the trusted loved one is normally fine and nothing happens, it can be a slippery slope which is why I recommend any financial moves to be as transparent as possible and shared among the siblings or trusted loved ones. Most elder abuse is done by family and trusted professionals (doctors and lawyers). The access to money is a temptation . . . we all think we can withstand it but why test ourselves? This is why I recommend an "informal transparency" to protect your elderly loved ones and you.

Following is one system to implement - one trusted representative is a signatory on the elderly loved one's checking accounts and a second trusted representative has access to it (i.e. - given the user name and ID). When a separate account is created to pay for care, we suggest two trusted representatives on the account.

The other pitfall are the family members, friends and care takers who will try to manipulate your elderly loved one into private gifts, be it through money, credit card purchases, a car for their grandchild (we've seen this) or they ask them to write them into the will/trust. Again, this is why financial transparency is a must. If the monitoring is spread among many it is much more difficult for one to have undue influence.

The elderly community is rife with stories of hired "trusted" caretakers who steal little things — trinkets, jewelry, food and petty cash. (See my column on hiring and monitoring Caretakers). Again, anything valuable should be removed from the house and gifted to the different loved ones and/or trusted representatives. If the family doesn't agree we suggest outside assistance in the form of attorneys and psychiatrists/psychologists. I always hesitate to use either because . . . they cost money.

I am not a fan of always having relatives as agents. I counsel to have one familial agent and one professional agent. Unless the professional and your relative are in a conspiracy (like the son and lawyer of Brooke Astor), the finances stay fairly transparent. In blended families I suggest one person from each family . . . again, transparency becomes key.

Bottom line, the above suggestions are just precautions. If you’re the agent, as I was, take the easy way out and make all your moves as transparent as possible. At the end of the day, it’s family and what’s more important?

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