Sunday, January 1, 2017

A plan to deal with aging

It’s 2017. Another year has disappeared into history. If you are like me, the older you get, the more quickly each year seems to pass.
January is the month when people make resolutions for the New Year. If you are over age 60, and especially if you have reached age 70 (like me), consider this to be a great time to resolve to put together a plan for dealing with the realities of aging.
Of course, we all have some differences in our specific situations and concerns. But none of us can avoid aging and most of us need to address common questions like:
1)    Are my financial resources sufficient for the rest of my life? What can I do to maximize and protect them?
2)    If (or more likely when) I fall prey to disability who will step in for me:
a.     Who will pay my bills and manage my financial resources?
b.    Who will make decisions about my care?
c.     How do I make sure that my caregivers have the power they need to provide for me?
3)    What can I do to limit placing financial and personal burdens on my family?
4)    How can I avoid financial devastation if my spouse or I get sick and need care for a long time?
5)    How can I best provide for my family in the event of my disability or death? Who will get what I own when I die? My family? The government? Who should be in charge?   
6)    What kinds of care do I want to receive at the end of my life?
In putting together your plan, recognize the possibility that you may live a very long life. According to data compiled by the Social Security Administration:
    A man reaching age 70 today can expect to live, on average, until age 85.4.
    A woman turning age 70 today can expect to live, on average, until age 87.5.
And those are just averages. Social Security estimates that about one out of every four 65-year-olds today will live past age 90, and one out of 10 will live past age 95. And given the remarkable advances we are seeing in medicine, genetics, and robotics, the Social Security estimates may be much too conservative.
So we all need to plan for the issues that can arise from an extended life span. This includes the likelihood that we will eventually face one or more disabilities and require long-term caregiver support. The reality is that most people who are age 85 and older do have some disability and need some assistance in their daily lives.
At age 65 the chances we will need care support at some point during our remaining lives is 70%. A large percentage of us (40%) will need care support for over 2 years. The financial costs and personal burdens placed on care-giving families can be substantial. But, you can create a strategy now to protect yourself and your family from these costs and burdens.
To put together a good strategic plan for aging you are going to need the help of experts in financial planning and elder law. The good news is, the help you need is available.  You just need to be willing to seek it out. An elder law attorney can help you find and implement the best solutions to critical legal, financial and care planning issues. 
Key Documents in Planning for Aging
Here are some of the planning documents that are often included as components of an effective plan for aging.
Financial Power of Attorney - This critical document allows a trusted agent of your choosing to step in to pay your bills and manage your financial affairs in the event you can no longer do so. You need to make sure you choose the right person. Don't neglect to name a backup in case your first choice can't serve. 
You may want to notify your financial advisors and institutions of your choice in advance. If a financial institution has its own “in-house” power of attorney form, you may want to complete it as a supplement to your primary document. And make sure your chosen agent knows how to get access to the financial information he or she will need when they have to step in.  
A financial power of attorney is a very sophisticated and complicated document. This is not something to take lightly or buy online. You need to make certain that your agent has the powers required to protect you and your family and that those powers are consistent with your personal situation and goals. 
Seek expert guidance to create a document that has the provisions you and your agent will need.
Health Care Directives - These documents allow you to give directions regarding the kinds of care you want to receive in the event you become incapacitated. They allow you to designate the person(s) you want to be making health and personal care decisions for you. If you already have a living will with instructions for end of life care you need to recognize that having a living will is not sufficient. You need to plan for living as well as dying. The key planning document you need is a Health Care Power of Attorney.
Will - this is a document that says who gets what when you die. It also names someone to be in charge of finalizing your affairs. It can be used to create trusts and protect your beneficiaries. But, many people don’t realize that they have created other documents that can trump the provisions of their Will. These include trusts, life insurance, annuities and other investments with beneficiary designations, and joint ownership arrangements. If you become incapacitated you may not be able to change the terms of your Will and beneficiary documents. So, it is wise to have your Will and beneficiary designations reviewed and updated as needed as you have your aging plan prepared.
Trust – this is a document that can be used to provide for management of some of the investments and other things that you own. Trusts can be very useful tools in planning for aging. Special forms of trust can allow you to set aside a home or savings to be protected in the event you or your spouse encounter serious and expensive health and long term care costs later in your life.  
Quality Advice: As Important as Your Documents
The above documents are important components of your aging plan. But a good plan requires more than just having legal documents prepared. You also need to put a well thought out strategy in place.
People often don't appreciate the complexity of planning for aging and dealing with issues like long term care. It is imperative that you get the highest quality advice in putting together your plan. Be sure to talk with a lawyer who is a recognized expert in elder law. If you live in Pennsylvania, you can call my law firm, Marshall, Parker and Weber and set up an initial meeting. You can consult with one of our firm’s 3 lawyers who have achieved the distinction of having become certified as specialists in elder law by the National Elder Law Foundation and the Pennsylvania Supreme Court. 
The likelihood that your goals will be achieved depends largely on how good a plan you put in place. The quality of the advice you get in putting together your plan and documents is critical to protecting you and your family. Don’t be penny wise and dollar foolish when your security and your family’s future are at stake. Don’t try to do it yourself or seek unqualified assistance. You and your family may pay dearly for your mistakes.    
Bottom Line: If you are over 60, this winter is an excellent time to recognize that the years are going to continue to rush by. And that the best time to prepare for your aging self is right now.  
Further Reading:

Want to know your life expectancy? Social Security has a simple Calculator that gives a rough estimate of how long you (or your spouse) may live.

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