Can You Protect Yourself or Loved Ones from Financial Elder Abuse?
In 2021, more than 6.2 million people in America live with some form of Alzheimer’s disease and need some type of memory care. At the same time, financial abuse and scams, especially those targeting people 65 and older, are on the rise, says the Better Business Bureau.
Individuals suffering from Alzheimer’s and other forms of dementia face unique challenges when it comes to financial elder abuse and scams, according to a recent report “Protecting you or a loved one from financial elder abuse and scams” from Idaho News 6. The increasing number of Alzheimer’s diagnoses increases chances of needing in-home, memory care or skilled nursing care at some point, making it increasingly important to plan ahead. When there is no advance planning, financial devastation and family stress occurs.
Planning starts with an experienced estate planning attorney who can help the family prepare these four basic documents. They are the cornerstone to protect yourself and loved ones from financial elder abuse. They are:
- Last Will and Testament
- Financial Power of Attorney
- Health Care Power of Attorney
- Living Will/Advanced Directive
There are additional documents, depending upon the individual’s situation, including a Durable Power of Attorney, used to give another person the ability to make decisions for property, business and financial matters. In cases of future incapacity, this is extremely important.
What are some ways you Can Protect Yourself or Loved Ones from Financial Elder Abuse?
Power of Attorney: This is another key component to protecting yourself and loved ones from financial elder abuse. This appoints an “agent” who can make financial decisions on behalf of the “principal.” The POA creates a fiduciary relationship between the agent and their principal, wherein the agent must act in the best interest of the principal, above their own interest. The selection of a POA is very important, since it is a big responsibility.
The Principal should also name a successor agent, in case the primary agent is not able or willing to take on their role. Understand the possibility of abuse of power by the agent before finalizing any documents. An agent who abuses their powers or reaches beyond their powers can be prosecuted. However, it is best to make a good choice from the start and try to avoid problems.
Most of us get all the right protection in place for our homes, cars and have health insurance in place. However, the chances of needing long-term care for a dementia are actually higher than having your house burn down.
Planning for incapacity and protecting yourself and your loved ones can be accomplished with the help of an estate planning attorney. Have the conversations with your attorney and your family early and get going.
I hope you liked this article, “Can You Protect Yourself or Loved Ones from Financial Elder Abuse?” To learn more, read: How to Protect an Estate from a Rotten Son-in-Law and What are Responsibilities of Trustees and Executors? and How to Approach Parents about Estate Planning and Is Planning Your Estate Really That Important?