4 Ways to Assist Elderly Parents with Estate Planning
You may have sealed the deal on your own estate plan, relieved that the lengthy process is now behind you. Well, not so fast… More often than not, elderly parents need your assistance with theirs.
Principals Jason Smolen and Daniel Ruttenberg lay out a step-by-step plan detailing how to assist your parents with their estate planning needs while updating, as they get older, the arrangements they’ve already made. Here are four critical steps:
Open the lines of communication about estate planning.
“Before going any further, have a frank and honest discussion with your elderly relatives,” Ruttenberg advises. This may include other family members who may be involved, such as your siblings. And while the conversation may be awkward, it is important to understand your parents’ wishes and objectives, Ruttenberg explains.
Identify key contacts.
Just like you’ve done for yourself, compile the names and addresses of professionals (doctors, attorneys, financial advisors, etc.) important to your parents’ finances and medical conditions.
List and value their assets.
If you’re going to help manage the financial affairs of your parents, having knowledge of their assets is vital. Smolen recommends keeping a list of their investment holdings; IRA and retirement plan accounts; and life insurance policies, including current balances and account numbers.
Execute documents.
Assuming you can agree on how to move forward, develop a plan incorporating several legal documents. If your parents have already created one or more of these documents, they may need to be revised or coordinated with new ones. Some elements commonly included in an estate plan are:
Wills.
Your parents’ wills control the disposition of their assets, such as cars and jewelry, and tie up other loose ends. (Of course, jointly owned property with rights of survivorship automatically passes to the survivor.) Notably, a will also establishes the executor of your parents’ estates. If you’re the one lending financial assistance, you may be the optimal choice.
Living trusts.
A living trust can supplement a will by providing for the disposition of selected assets. Unlike a will, a living trust doesn’t have to go through probate, so this might save time and money, while avoiding public disclosure.
Powers of attorney.
This document authorizes someone to legally act on behalf of another person. With a durable power of attorney, the most common version, the authorization continues after the person is disabled. This could enable you to better handle your parents’ affairs, if necessary.
Living wills or advance medical directives.
These documents provide guidance for end-of-life decisions. Make sure that your parents’ physicians have copies so they can act according to their wishes.
Beneficiary designations.
Undoubtedly, your parents have filled out beneficiary designations for retirement plans, IRAs and life insurance policies. These designations supersede references in a will, so it’s important to keep them up-to-date.
When to speak with an attorney
Estate planning for elderly parents, which is complex in its own right, is often intertwined with your own finances. For help developing a comprehensive plan that addresses all of your family’s needs, please contact Daniel Ruttenberg at dhruttenberg@smolenplevy.com or Jason Smolen at jdsmolen@smolenplevy.com.
About the Authors
Jason Smolen
Jason Smolen is a founding principal of SmolenPlevy. Smolen’s knowledge of complex estate and business issues has drawn the attention of ABC News, USA Today, E! Online, Realty Times and the Bank of America Small Business Online Community. Mr. Smolen is a graduate of the City College of the City University of New York and the George Mason University School of Law. Smolen also serves as a board member of a local citizens association and recently co-authored an article titled Why You Should Think About Spousal Limited Access Trusts (SLATS).
Daniel H. Ruttenberg
Daniel H. Ruttenberg, JD, CPA, LLM is a principal with the firm. Mr. Ruttenberg received his Bachelor of Science degree with a double major in Accounting and Finance from the University of Maryland. He earned his Juris Doctor with Honors from George Mason University School of Law and his Master of Laws in Taxation with Distinction from Georgetown University Law Center. Mr. Ruttenberg also served as the Director of the Fairfax Bar Association (FBA) for seven years. During this period, he was also elected president – the youngest in FBA history and served as a member of the Board of Directors for the Fairfax Law Foundation.
