There’s no escaping the reality that we’re all living longer—or perhaps, dying longer. Whether we like it or not, unless we die prematurely or very suddenly, our physical abilities will degrade, as will our mental abilities. There will likely be undesirable consequences if we don’t have adequate financial oversight and caregiving support.
Simplify and document your affairs
Leaving a complex estate for your family and representatives to manage in your declining years, and after your death, also leaves them with a lot of work and significant challenges Here are a few things you can do:
a. Compile a comprehensive estate organizer with details on all aspects of your life b. Find people, charities, or other organizations that will appreciate your unused possessions c. Reduce and consolidate the number of financial accounts, assets and institutions
Structure your financial plan with a “rainy day protection” allotment
Financial plans are only as good as the ability of the people involved to understand and execute them. To simplify your plan and make the outcome understandable, categorize all your available financial elements, including income sources, savings, investments, and assets, into three allotments:
a. Every day spending: to sustain your yearly spending requirements for the planning period b. Rainy day protection: for significant and unplanned life events c. Estate & legacy: financial resources and assets not required during your lifetime
Choose your POA delegates with great care
The selection of the attorneys (delegates) for care and property requires great attention and thought. Preferred choices include trusted adult children, relatives, or friends significantly younger than you.
Criteria for selection of executors and attorneys include:
a. appropriate skills b. interest and motivation c. good health d. availability e. trust
In addition, compassion is probably the most important attribute for the POA delegate for personal care.
It takes a very special person to honor your wishes and join you on your journey.
Activate your Power of Attorney (POA) for property NOW
A POA for property is the legal document used to appoint a person, the attorney for property, to make decisions and take action related to your property and financial affairs. It is required for proper transition of your finances when you can no longer manage these tasks and decisions. Once you have an up-to-date signed document, you should:
a. Communicate and review the POA for property with your assigned attorney(s) b. Provide multiple copies of the POA documents to your attorney(s), including a scanned (electronic) copy c. Activate, NOW, your POA for property with applicable organizations: banks, investment institutions, finance/tax departments of government, insurance companies
Gradually transition the management of your affairs and personal care
Actively involve your POA delegates in your affairs, as early as is feasible. Follow this four-step process:
a. Have your attorneys learn about your affairs and wishes b. Allow your attorneys to shadow your activities c. Gradually transition management to your attorneys d. Fully hand off
Meet yearly, and when your estate or wishes change significantly, with your POA delegates, family, and advisors
Continuous reinforcement of trust and sharing of knowledge will make the transition smoother when the time comes. Frequent, open dialog also reduces the risk of you making undesirable changes to your estate or legal documents if your mental abilities decline. Review meetings should be attended by:
a. executors b. attorneys for property c. attorneys for care d. close family e. selected advisors
Crystallize, document and discuss your healthcare wishes
A healthcare event can occur at any time, and you may need assistance sooner than ever expected. There is no better time than now to prepare for such a situation. Here are the steps to start the process:
a. Clarify your own preferences and values as they relate to personal care b. Put a healthcare directive in place, as a complement to your POA for care c. Discuss your healthcare directive with your attorney for care, family, healthcare providers, and other advocates.
These actions will optimize the chances that your wishes will be respected.
Contemplate your lodging option and preferences for possible life transitions
Degrading health conditions can trigger the need for new living arrangements. It can be very stressful for family and yourself to investigate options and decide. There is no better time than now to get educated and opinionated. You may even want to identify and seek professional assistance in the process:
a. Decide whether and when selling or downsizing your principal residence makes sense b. Consider selling or transitioning secondary properties c. Engage a specialized agent to explore, for future considerations, the various alternatives for homecare, senior living and similar