PLANNING FOR THE SOLO SENIOR

I ask the woman on the other side of my desk who she would want to name as her agent in her financial power of attorney. I explain to her that this will be the person who will make financial decisions for her, if she is unable to make those decisions for herself.

“I don’t have anyone who could make those types of decisions for me,” she says, with a distressed tone to her voice. “My family and friends have all died. I wouldn’t know who could make those decisions for me.”

Having a financial power of attorney and an advanced health care directive is very important. If you are ever unable to make a decision for yourself, no one – not your spouse, not your children, no one – could make decisions for you. This fact could cause you significant problems.

For example, if you are involved in a car accident and are seriously injured to the point where you can no longer make your own financial or health care decisions, if you failed to sign powers of attorney and an advanced health care directive, nobody would be able to pay your bills or make health care decisions for you.

Since the cost of health care is extremely high, the inability of your family to access your finances and pay your bills could prove very troublesome. Since you might be receiving health care twenty-four hours a day, seven days a week, the inability for family or friends to make health care decisions for you could prove deadly.

But my telling people to have these documents is of little value to an individual who has no one to make these types of decisions for them. You have to name someone.

In fact, I often tell people that they should always name two agents in their powers of attorney and advanced health care directives, a primary agent and a secondary agent. That way, if the primary agent cannot or will not act on your behalf, the secondary agent can step in and make the necessary decisions for you.

If a person only names one agent and that agent cannot or will not act on his behalf, then the power of attorney/advanced health care directive would fail due to a lack of an agent. Stated otherwise, if you do not have a named agent in your documents, your documents are of no value.

You need to trust the person you name as your agent for financial decisions and health care decisions. This person will be making very important and significant decisions for you. If you do not have a family member or friend who is willing to make these decisions, you will need to find some form of commercial entity, such as a bank, that would be willing to make financial decisions for you if you are unable to make those decisions for yourself.

Banks often serve as trustees of trust. In that role, the bank invests the assets of the trust and makes distributions of the trust’s money to or for the benefit of the trust beneficiary. The duties and obligations of an agent under a power of attorney are quite similar to the duties and obligations of a trustee, so a bank would probably be willing to serve in the capacity of an agent under a financial power of attorney.

Of course, you will need to have a compensation and reimbursement clause in the power of attorney. A financial institution will not perform the work of investing and distributing assets for your benefit without being compensated. Moreover, you should approach the bank before finalizing the document to ensure that the bank is satisfied with the wording of the document and the level of compensation provided to them in the document.

A bank will not make health care decisions for you. So, if you have no one who you trust to make these decisions for you, you will have to draft a living will that clearly states your intentions regarding your care if you are unable to make decisions for yourself. In addition, it would be beneficial if you provide examples of your health care preferences in given situations.

My office has a number of questionnaires that I provide to each of my clients when they sign an advanced health care directive. These questionnaires are designed to explain in greater detail how the person would like to be treated given differing health care situations.

A “living will,” unlike a “health care power of attorney,” does not name an individual to make health care decision for you; a living will merely states the type of care you would want or would not want in given health care situations. An “advanced health care directive,” which is what I typically draft for my clients, combines the terms of a living will and a health care power of attorney.

Planning ahead can give solo seniors peace of mind and ensure that decisions about health, finances, and property are handled the way they want. Even small steps now can make a big difference later, helping maintain independence and control.