Over the course of the last century, the number of U.S. residents over the age of 65 has increased 11-fold, and according to the U.S. Census Bureau, the median age of our population is expected to continue to rise.
Where 1 in 25 Americans was elderly in 1900, they now comprise 1 in every 8 residents. By 2050, we can expect that ratio to rise to 1 in every 5.
Our Mesa estate planning attorneys know that this is inevitably going to mean an uptick in crimes against the elderly, particularly in the form of financial exploitation.
Unfortunately, we can’t assume that our children or other loved ones will protect us from these perils. Even with the best of intentions, elder financial abuse may be difficult to recognize. It’s often perpetuated by someone we know and maybe even trust.
Proper planning at the dawn of your golden years can mean protection of your assets and interests as you age. There are also options for family members fearing their loved ones are at risk of financial abuse – or who may already be suffering from it.
Financial abuse of the elderly is already a huge problem, affecting some 5 million older adults and costing an estimated $3 billion yearly in the U.S., according to the National Center on Elder Abuse.
It is a threat not only to one’s dignity and independence, but also to one’s health and safety.
Essentially, anyone with access to your personal information could potentially misuse it for their own benefit. Family members who struggle with addiction or untreated mental health issues may present a particular risk. The trespasses range from minor to serious.
Often, one of the biggest problems is that it can be difficult to spot. Older folks may tend to be more isolated, and things like missing money or a lost treasured possession could simply be seen as a sign of the forgetfulness that becomes increasingly common with age.
The good news is that many medical doctors are taking part in a conscious effort to help screen older patients who may be seen as financially vulnerable.
But in order to be effective, the effort can’t stop there.
Part of what you can do in advance to protect yourself and/or your family member is to establish an Arizona revocable living trust. This is a written agreement whereby you designate someone to be responsible for managing your property. It’s called a living trust because it is established while you are still alive. It’s revocable because so long as you are mentally competent, you can dissolve or change it on your own at any time for any reason. Usually, it only becomes irrevocable after you die.
It involves you, the trustee or trustees you designate to manage your assets and the beneficiaries. A living trust will allow you to continue to maintain control of your assets as you wish – including sell, invest or exchange them as you see fit. However, outsiders will have limited access to those assets, unless first going through the trust. It creates an important level of protection.
If it is your elderly family member you are concerned about, you might consider seeking a conservatorship. This is a court proceeding whereby an individual or entity is designated to manage the financial affairs of either a minor or incapacitated adult who is unable to manage his or her own property or other financial matters.
This can be an important step if you fear your loved one is at high risk of being financially exploited or has already been exploited in the past. A conservator is held to the standard that is applicable to a trustee, which is that he or she has a legal duty to be prudent in dealing with the property of another. That means distribution of funds necessary for support, benefit or care will be given to a person who is determined to be legally responsible.