As your body ages, your hair grays and you start thinking about retiring, it is important you consider where you stand legally, as well as physically and mentally.
Everyone, no matter their means, needs to make sure they have the necessary papers drafted and executed to ensure someone they trust will honor their wishes if they become ill -- and that person, not the courts, will make decisions for them. They also need to make sure that when they die, people they love receive their wealth and valued items, not the state of Illinois.
Many senior citizens live with the misconception that "only rich people need estate planning."
"They come to me and say, 'I am a person of modest means. I don't need estate planning.' So I have to retrain how they think and explain that doing estate planning is just like buying insurance," said Nancie Golnick Dorjath, an attorney with offices in Batavia and Oak Brook who specializes in elder law.
"You never know when you are going to need powers of attorney for health care and property, for instance, but, to be honest, paying an attorney to draw up the correct paperwork causes a lot less expense and heartache than if you don't have them and have to go through guardianship proceedings when mom needs help," she said.
"Each senior is unique. Some want their children to get as much money as possible and others say that because they earned it, they want to spend it all themselves," Dorjath said. "Remember that the information you get on television isn't applicable to everyone. You need to sit down with a knowledgeable attorney to establish what documents you personally need for your unique situation. You need to establish who has the authority to help you. For instance, who do you want to have access to the funds in your IRA to potentially pay for your care, as well as many other tasks? I've seen these issues break apart families when mom or dad haven't decided in advance."
She also urges people to revisit their wills and other arrangements periodically to make sure their circumstances or wishes have not changed. "Your documents need to be tailored to meet your evolving needs," Dorjath said. "Remember that it took you a long time to accumulate whatever wealth you have, so you want your wishes about its distribution after your death to be honored."
While you can execute your own will using documents found on the internet, Dorjath cautioned that those internet-generated documents won't necessarily be the most accurate and useful ones for your own situation. This also goes for internet "powers of attorney" forms, which may not provide needed protections and authority.
"Elder law attorneys are aware of the many different issues that affect seniors. When your children were young you wanted to establish who would be their guardians if you passed away. Now you need to worry about if you or your spouse ends up needing a skilled facility," she said. "How are you going to be able to afford that? Or if you have a special needs adult child, you need to make special provisions for that child."
Different states have different laws when it comes to estates and inheritances, so it is also important to hire someone local who has the right information to help you or your elderly parent make an informed decision, Dorjath believes.
Half of her estate planning workload involves clients who have never had any type of will or power of attorney documents and the other half are people who need to update their wills, which are usually at least 15 years old, she said.
When someone with an elderly loved one comes to Dorjath, it is often a crisis. Mom or dad has become ill and the child needs help with protecting assets, finding an appropriate caregiver or senior community, selling the house and so forth. She counsels them on getting necessary documents in order, applying for Medicaid (if appropriate) and walking them through the crisis.
But Dorjath urges everyone to plan ahead in order to avoid a crisis. "Planning ahead is smart and it shouldn't have a negative connotation attached to it. It is just like buying car insurance in order to take care of things if something unfortunate happens," she said. "I usually say anyone 18 or older and breathing needs these important documents! These protect people while alive, which seems more important to me than what happens when they die."
Planning ahead and getting professional legal advice can save an estate thousands of dollars. Consulting with someone who knows the rules can make the executor or trustee's job easier and can let you know if probating the will through the courts is necessary or beneficial or if the time and money involved can be avoided. Dorjath can also advise them when it is legal to distribute funds, investments and other properties and how to accomplish it properly.
She and other elder law attorneys also handle Medicaid applications for elderly people who still may have assets to protect and want to qualify for Medicaid or who have run through their money and still need food, shelter, medicine and care. She helps them fill out the necessary paperwork and, for those who attempted to do the application on their own and got turned down, Dorjath handles the subsequent appeal.