Winter 2017 Legacy Newsletter

Cleveland Estate Planning Attorney

Download a copy of The Legacy Advisor Winter 2017

A Gift for you, a Gift for Your Family

Featured Guest Article by Loretta Heindrichs – Personal Historian and Legacy Advisor,

As maturity creeps up on us, we begin to see the value of passing along our memories to the next generation.

When we were young our time was occupied with education, jobs, careers, and child rearing. We think only old people talk about the past. Then one of our beloved elders passes away and we want to say “Wait, there are questions I wanted to ask you.” “If only I had known…….” “What was it that Dad said about…….”

Health Benefits to Telling Stories

Health professionals tell us that there are physical benefits to telling our stories: improved immune systems, reduction in depression and anxiety, and lowering of blood pressure. In addition there are emotional benefits: we make meaning and sense of experience, we gain perspective on life, we remember and will be remembered.

In addition to sharing facts, we can also share with future generations our life lessons, wisdom and values. So you can see that this is a gift for yourself, and also a gift for generations to come, a gift that becomes more valuable with each passing year.

Personal Historians Can Help Trigger Memories

Don’t know where to start? There are many possibilities with today’s technologies for do-it-yourselfers. If you want ideas and guidance, work with a personal historian. A personal historian can ask questions that bring your memories flooding back and help you tell your stories your way. The possibilities are endless.

Loretta Heindrichs is a personal historian who offers the following services:

  • Video Biographies
  • Video Memoirs – recollections of portions of a life such as, for example, a career
  • Your life story in photo books that can include titles and text
  • Books of vacation photos
  • Videos or books showing special events such as, for example, 75th birthday
  • Photos and the story behind the object such as jewelry and family heirlooms
  • Ethical wills or legacy letters. These convey your life lessons, values, and messages of love to your family to cherish for decades to come. They can be recorded on video or in letter or small book form.

Mark Twain once said: “There was never yet an uninteresting life. Such a thing is an impossibility. Inside the dullest exterior, there is a drama, a comedy, and a tragedy.”

Preparing for Incapacity – Part One

Comprehensive Estate Planning Should Include Preparation for Incapacity

Many people believe estate planning deals only with the disposition of assets upon death. However, comprehensive estate planning involves not only preparing for death, but also planning for the proper care and management of your assets in the event of incapacity.

Individuals Incapacitated Lose Legal Rights to Make Decisions

Most of us don’t like to contemplate the possibility of becoming incapacitated, but this is an issue that should not be ignored. Incapacity can result from a number of circumstances such as an auto accident, a work-related mishap, or simply getting older. In fact, 50% of those between the ages of 80 to 85 are suffering from some form of dementia. A person who becomes incapacitated loses the legal ability to manage their own assets. Without proper legal planning, a guardian for an incapacitated person must be appointed by the local probate court. This is a time consuming, expensive, and burdensome process. In addition, the guardian will be subject to the ongoing supervision of the probate court and will be required to submit periodic accountings showing how the incapacitated persons assets have been managed.

Without a Plan is in Place, Local Probate Court Assigns a Guardian

In order to avoid the appointment of a guardian, every adult should have a well-drafted Power of Attorney. A person who creates a Power of Attorney, generally referred to as the “Principal,” designates an individual, referred to as the “Agent, who is granted the legal authority to conduct financial transactions on behalf of the Principal. While the Principal is competent, both the Principal and the Agent are legally empowered to engage in financial transactions. The authority of the Agent remains in effect even after the incapacity of the Principal.

Power of Attorney Prepared by Estate Planning and Elder Law Attorney

A Power of Attorney should be prepared by an attorney experienced in estate planning and elder law. It is imperative that the document be drafted to grant the Agent the powers necessary to engage in Medicaid planning on behalf of the Principal in the event the Principal ever requires nursing home care. The Power of Attorney forms found on the internet or prepared by an attorney who does not specialize in elder law are often inadequate to allow the Agent to engage in complex long-term care planning for the Principal.

Because a Power of Attorney is a very powerful legal tool that provides the Agent with broad authority over the assets of the Principal, it is essential that the Agent be someone who is completely trustworthy. Although the Agent is under a legal duty to act only in the best interests of the Principal, there have been many instances of Agents enriching themselves at the expense of their Principals.

While a Power of Attorney is a very valuable legal tool, there are limits to its usefulness. A number of major banks and brokerage firms will not recognize an Agent’s authority under a Power of Attorney. These institutions are afraid of incurring liability in the event the Agent uses their authority for an improper purpose. Family members of a Principal may say sue a financial institution for permitting an Agent to carry out a transaction that results in a financial loss to the Principal. Because of the chance that certain financial institutions may not recognize a Power of Attorney, it is good practice for a Principal and their Agent to bring their Power of Attorney document to their bank or brokerage firm for review to ensure that they will accept the authority granted to the Agent.

In our next issue we will discuss other legal methods of preparing for incapacity.