Estate Planning, odds and ends

[JBTX]

My aunt and uncle's trust says this:
View attachment 62031

My uncle and I are co-trustees of the trust. I am also my uncle's agent for determining whether he is incapacitated (i) above. SO it would take me and his personal physician (I'm not sure if he has one) or a disinterested physician appointed by me.

Even though my uncle is 90 yo, he is still of sound mind and making all decisions. I frame it as he is the pilot and I'm sitting in the co-pilot seat ready and willing to take the controls when he says to or if something happens that he no longer can (temporarily or permanently).

If I was devious could I freeze him out? Perhaps, but I have my own wealth and better things to do with my time than to initiate something like that though I'm mindful that cirsustances may force me to have to remove him against his wishes.

Neither of my parents fully comprehended their cognitive decline.

If you are co trustee don’t you already have the ability to do things? Not that you necessarily need to

 

[Sunset]

.....

We keep a safe deposit box with critical docs and enough cash to provide our executrix (?) cash to cover expenses until she gets into the other accounts. She is the beneficiary on everything.

....

Hopefully the Will is not in the safety deposit box, or the bank will deny her entry, unless you add her as a authorized user of the box.

If you make you financial accounts TOD to her, then she can get the money in them within a few days, so no real need to have cash in the safety deposit box.

 

[JBTX]

I'm still searching for the right criteria to put into my documents that define when the successor trustee is to take over. 3 different attorney's just shrug and expect me to take their (ineffective) boiler plate language.

If the other person is co-trustee does that solve it? Obviously you have to trust that person, but presumably you already trust enough to give that power upon incapacity

 

[Sunset]

Dealing with the estate following a death, while complicated, is pretty much a well defined process.

The real kinker in estate planning is when dementia is involved.

Dad had everything in a trust, POAs, and we had a joint checking account so I could pay his bills.
His formal trust document said the successor trustee takes over "when a Dr states I'm not capable". However the PCP Doctor would not engage. The PCP Dr, hospital social worker, and hospital Dr all stated the exact same phrase: "He's still making decisions, they're just bad decisions".

So we had to go to court to get him declared incompetent. The court lets a diagnosed dementia patient chose their own conservator... who must become the sole successor trustee of the trust. Since he was mad at being taken to court he (his lawyer) told the judge he wanted a 3rd party conservator

Twenty years of estate planning and 80K in 3rd party conservator+legal fees flushed down the toilet.

I'm still searching for the right criteria to put into my documents that define when the successor trustee is to take over. 3 different attorney's just shrug and expect me to take their (ineffective) boiler plate language.

I feel your pain.

Don't know when that phrase became acceptable: "He's still making decisions, they're just bad decisions". But a Protective Services Worker said the same thing as an Uncle gave away his $400K house.


Just Random thinking here:
How about setting an arbitrary date for the successor trustee is to take over or an failure to complete some test involving mental ability (maybe the dementia test or mathematical test) in front of 2 witnesses.

 

[pb4uski]

... Don't know when that phrase became acceptable: "He's still making decisions, they're just bad decisions". But a Protective Services Worker said the same thing as an Uncle gave away his $400K house.

Yeah, that is mind boggling.

 

[Spock]

If the other person is co-trustee does that solve it? Obviously you have to trust that person, but presumably you already trust enough to give that power upon incapacity

Dad's lawyer asked me the same question in court.

Being a co-trustee gives me the power to act.
But it does not remove the dementia patients (grantor and trustee) power to act.
It creates a tie.

So while I was working to with property managers to evict a tenant, Dad was firing the property manager based on the tenants say so (and he hired a "property manager" selected by the tenant.

 

[Spock]

My aunt and uncle's trust says this:
View attachment 62031

My uncle and I are co-trustees of the trust. I am also my uncle's agent for determining whether he is incapacitated (i) above. SO it would take me and his personal physician (I'm not sure if he has one) or a disinterested physician appointed by me.

Even though my uncle is 90 yo, he is still of sound mind and making all decisions. I frame it as he is the pilot and I'm sitting in the co-pilot seat ready and willing to take the controls when he says to or if something happens that he no longer can (temporarily or permanently).

If I was devious could I freeze him out? Perhaps, but I have my own wealth and better things to do with my time than to initiate something like that though I'm mindful that circumstances may force me to have to remove him against his wishes at some point and I would prefer not to do so if I can help it. I think it will all work out.

THANKS! Thats a place to start and I've saved a copy into my "trust file".

I've been thinking about quantitative criteria such as the SLUMs or MMSE but one has to be in really bad shape to fail those. The test needs to cover decision making/"executive functions".

 

[Spock]

I feel your pain.

Don't know when that phrase became acceptable: "He's still making decisions, they're just bad decisions". But a Protective Services Worker said the same thing as an Uncle gave away his $400K house.


Just Random thinking here:
How about setting an arbitrary date for the successor trustee is to take over or an failure to complete some test involving mental ability (maybe the dementia test or mathematical test) in front of 2 witnesses.

I've been thinking of devising my own test covering:

• ability to recognize a scam (Publishers Clearing House winner, Spanish Lottery, banking with Nigerian princes)
• ability to recognize phishing emails or scam calls.
• Financial acuity: give a choice of two wildly different bonds with the lower coupon bond being the better value.

I was going to add a bullet about being able to distinguish AI from reality, but that's just asking to be fitted for the straight jacket.

 

[JBTX]

Dad's lawyer asked me the same question in court.

Being a co-trustee gives me the power to act.
But it does not remove the dementia patients (grantor and trustee) power to act.
It creates a tie.

So while I was working to with property managers to evict a tenant, Dad was firing the property manager based on the tenants say so (and he hired a "property manager" selected by the tenant.

It would be the same with a DPOA. A DPOA only gives you rights, it doesn’t take others rights away. As far as I know a trust doesn’t have the legal authority to take an individuals rights away. Only way to do is via conservatorship / guardianship which has its own issues

With Fidelity and perhaps other investment firms they can deem a person “at - risk” and reduce online access, but I don’t think that means you can’t still do things on phone.

 

[Midpack]

Wow, that's some funeral. My now deceased sister pre arranged her arrangements. She chose cremation and minimal extras, was less than $3062. I sat with her when she made the arrangements, and the options they presented her were mind-blowing, and I've read one can spend $50K on a funeral with all the bells and whistles. Depends largely on what you choose.

By all means make your checking account POD, and keep the balance at some useful level.

 

[pb4uski]

Neither of my parents fully comprehended their cognitive decline.

If you are co trustee don’t you already have the ability to do things? Not that you necessarily need to

Yes, as co-trustt there are a lot of things that I could do. But I don't as long as uncle is still capable of doing it unless he asks me to. Despite what the trust allows the "deal" between us is that he's the pilot and I'm the co-pilot ready to take over when needed unless he is crashing the plane.

 

[pb4uski]

Dad's lawyer asked me the same question in court.

Being a co-trustee gives me the power to act.
But it does not remove the dementia patients (grantor and trustee) power to act.
It creates a tie.

So while I was working to with property managers to evict a tenant, Dad was firing the property manager based on the tenants say so (and he hired a "property manager" selected by the tena Int.

My dad's trust had 3 co-trustee's upon his passing, DM, Dsister and me with a provision that any two of us could take actions on behalf of the trust. Since we never disagreed on any decision, it was never an issue.

Interestingly, all financial accounts had only a single log-in and once you were in you coudl do anything that you wanted to. I had the log-in info so probably coud have done anthing that I wanted, but with a risk that if they didn't like it they could sue me for taking unauthorized acts or something like that. But the financial institutions had that 2 or 3 language but never put any constraints in place with respect to it.

 

[OldShooter]

... the "deal" between us is that he's the pilot and I'm the co-pilot ready to take over when needed unless he is crashing the plane.

Copilot Checklist:

• Sit Down
• Shut Up
• Hang On

 

[RetMD21]

It would be the same with a DPOA. A DPOA only gives you rights, it doesn’t take others rights away. As far as I know a trust doesn’t have the legal authority to take an individuals rights away. Only way to do is via conservatorship / guardianship which has its own issues........

In the cases I am aware of in my extended family the as the decision making ability has declined so did the ability to act making it easy for the trustee DPOA/trustee to step in. I guess that was fortunate. Having competency hearings sounds expensive and unpleasant.

 

[pb4uski]

... Having competency hearings sounds expensive and unpleasant.

It depends. I was appointed guardian of my grandmother and my great aunt and in both cases it was uncontested so the hearing went smoothly. If it is contested, then that's a whole different thing.

 

[TrvlBug]

... ...Having competency hearings sounds expensive and unpleasant.

It cost us $30K 27 years ago. We do live in a HCOL area and yes, it was beyond unpleasant .

 

[JBTX]

In the cases I am aware of in my extended family the as the decision making ability has declined so did the ability to act making it easy for the trustee DPOA/trustee to step in. I guess that was fortunate. Having competency hearings sounds expensive and unpleasant.

This has been my experience. My dad who was experiencing cognitive decline - more than we realized at the time, ended up in the hospital from a fall, went to rehab and has/will never return. By that point he was ok signing an updated DPOA and was not in a position to be doing anything anyway, so I was able to take over fairly easily (getting it all setup was a bit of work). My mom who was not part of handing the finances was quite happy to let me take over.