Helping You Prevent Elder Abuse
Raxter Law has long been committed to preventing elder abuse in California. You can access our many resources here: Raxter Law’s California Elder Abuse Facts and Resources. If you or someone you know is being abused, contact us immediately to schedule an appointment. We can help.
Today we will take a bird’s eye view of elder abuse. We will then zoom in on one of the most pernicious forms of abuse – financial elder abuse. In this post, we introduce you to two legal tools you can employ to safeguard your financial security as you age.
Too Many of Our Elders are Victims of Abuse
Elder abuse affects 10% of Americans over the age of 60. According to the National Council on Aging, 5 million elders are abused each year with “only 1 in 14 cases being reported to authorities.”
What is Elder Abuse and Whom Does it Affect?
Elder abuse takes many forms and includes mistreatment that is:
Elder abuse is of serious concern here in California due to sheer numbers. California’s aging population is expected to be 6.4 million by the year 2025, and it will experience the steepest senior growth of any state in the union. The Bureau of Medi-Cal Fraud & Elder Abuse (BMFEA) found that California reports elder abuse, gross neglect, and exploitation at more than double the national average rate.
The BMFEA also estimates that approximately 410,000 Californians live in nursing homes, residential care facilities, and assisted living facilities. These include licensed and unlicensed facilities which house patients with dementia or Alzheimer’s. Isolation and diminished capacity leave these patients especially vulnerable to abuse and neglect. The National Council on Aging says that “recent studies show that nearly half of those with dementia experienced abuse or neglect.” Worse still, patients with disabilities are more likely to be victims of violence as well.
The Steep Cost of Financial Elder Abuse
Of the various forms of elder abuse, financial abuse takes a staggering toll on seniors. Elderabuse.org reports that financial abuse amongst seniors is estimated to have cost elders $6 billion to $36 billion over a four-year period.
Financial losses due to mismanagement or theft wrest away an older person’s ability to age with financial security. Advanced age also robs seniors of a timeline for recouping financial losses sustained late in life.
One writer for Elderabuse.org observes that “Elder financial abuse has become a costly epidemic in the United States, yet for the most part, it has remained in the shadows.” Twenty percent of persons over 65 report that they have experienced some form of financial elder abuse.
Estate Planning Tools to Enhance your Financial Security
If you or a loved one is approaching senior status, there are ways in which we – as your lawyer – can help. To some extent, financial elder abuse can be prevented more easily than other forms of abuse. But you must get your ducks in a row!
We have helped countless clients protect the assets they worked hard to earn over their lifetimes. Two tools we employ include naming a trustworthy “financial power of attorney” and creating a revocable living trust funded with some or all of your assets.
Your Financial Power of Attorney
A “financial power of attorney” is someone you choose to manage your financial affairs should you become unable to do so. If the time comes, this person is charged with paying your bills, making or approving investment decisions, buying or selling assets, transferring assets into a trust, and preparing your taxes. This person will have complete control over your financial matters so pick your designated power of attorney(s) with great care.
Most folks choose a trusted friend or family member to be their financial power of attorney. You may even decide to assign two people to this task to ensure that there is some oversight between the two.
By choosing a financial power of attorney while you still have full capacity, it is less likely that someone unscrupulous can manipulate your affairs to their benefit as you age and become incapacitated.
A Revocable Living Trust and Your Co-Trustee
We have also helped clients establish “revocable living trusts” to achieve both tax benefits and asset protection advantages. In the case of a revocable living trust, you create a trust while living – which you can revoke at any time – and you fund it with your assets such as your investment accounts, real estate you own, and bank accounts.
You are the trustee of your trust, and you should select another trusted friend or family member to govern your trust as per its terms should you become incapacitated. This person will act as your co-trustee.
You receive income from the trust while you are alive. The terms of the trust designate who will receive the trust’s assets when you die. Since you have established the management of your assets while sensate, you are protected from someone stealing or depleting your funds if you develop mental impairments down the road.
At your death, your assets will transfer immediately to your intended beneficiaries without going through the costly and time-consuming probate process. In short, your beneficiaries will receive your bequests efficiently and promptly, with possible tax savings to boot.