Aging, The Law, And You

What important pieces should people have in place as they begin planning their estates?
Every adult resident of New York state should have a durable general power of attorney naming an agent who can act for them in financial matters. If you do not have a will in New York, the law makes a will for you, in the form of the intestacy statute, that says who will inherit and who will administer your estate. If you do not have a health care proxy, the Family Health Care Decisions Act names a series of people who can make your health care decisions for you, although with some significant limitations.
But there is no statute that automatically appoints anyone to manage your affairs if you require assistance. That requires a guardianship proceeding. Guardianship proceedings take 28 days to complete, by law. They are often difficult, stressful, embarrassing and expensive. You can avoid all of that by having a good power of attorney.
That is my number one recommendation: have a good power of attorney. If you've done nothing else, that has the gifting powers required so that if you've delayed and procrastinated, at least you've named an agent that can do it for you.
What steps can individuals take to prepare for the possibility that they will require long-term care?
One step, of course, is always having the basic power of attorney in place. The next step is to consider whether some kind of a long-term care insurance policy is a financially viable option for you.
People often say, “I've heard it's so expensive.” Well, it really depends. I encourage all my clients between the ages of 50 and 70 to go out and investigate. There are a number of types of policies. One type of policy is a so-called “partnership policy,” where if you buy a certain level of benefit and you exhaust that benefit, you can qualify for Medicaid even though you do have assets. This can be an incredibly useful tool for a middle-class couple, where the concern is if one of them gets sick and the other one is healthy for 20 years, how does the healthy spouse pay the bills?
You can also buy a policy without a partnership feature and sometimes a much higher level of benefit. There are also even life insurance policies that are a hybrid of a life insurance policy and a long-term care policy, which is attractive to people because at least you know your family is going to get some money back.
There's a lot of pressure on the Medicaid funding, and how long those options are going to be available in the current political climate is open to question. The landscape is always changing. It's extremely important to get good advice and it's important to incorporate that advice into your estate planning not when the crisis occurs, but to have an attorney that you work with on these planning issues periodically so that you're educated and know that you have the mechanisms in place.
How can people find knowledgeable and trustworthy advisers to work with?
One thing you always want to do is ask them whether they hold themselves out as an elder law attorney or not, and whether they're a member of the elder law section. If you're going to the person who's done all of your work on real estate and simple wills and powers of attorney, they may do a perfectly competent job on that but they may not have the expertise to do that additional level of planning.
You should always have a plan, and realize that having a random will or a random trust or a random insurance policy isn't a plan. A plan is making sure that all those things work together to protect you while you're alive, and to get money to the people you want to have it with the least amount of taxes when you die. That requires some guidance from your lawyer, your accountant, your financial adviser.
When you're looking for someone, stick to referrals from friends, family and advisers. That's no knock on people who advertise online, but this is very personal stuff and you should feel very comfortable that you've got the kind of referral where you can trust someone personally. It's not a commodity item. You're getting into what should be a personal relationship with an adviser that you can call on over the years.
It's a process. People think that doing a will is just going to magically create an estate plan. It isn't. It's a good deal more work than that, and this is part of the total process of planning for your financial future.