Christine Benz: Hi, I'm Christine Benz. I'm here at the Investment News
Retirement Income Summit, and we're hearing today a lot about
long-term care. And I'm happy to say I'm joined here today with
Ben Neiburger. Ben is the principal at Neiburger Law, and he
focuses a lot on estate planning matters at his firm. Ben thanks for
joining us.
Ben Neiburger: Well thanks for having me.
Christine Benz: So, one topic that came up today was the interaction of estate
planning and long-term care. So a question for you, Ben, is for
someone who has an estate plan in place, and is also considering
long-term care, how do they adjust the estate planning documents
to reflect the existence of a long-term care policy?
Ben Neiburger: Well with the long-term care policy, you understand that it pays
out a stream of income for care, whether the care is at a nursing
home, or an assisted-living facility, or at home. So they have to
arrange the estate plan to control the payments that come out of the
long-term care insurance, so that they can get those payments to go
to the right places, so they can either stay at home in the
community, or in the assisted-living facility with all of their
friends, and those types of things. One of the best things to have is
called powers of attorney.
Christine Benz: A financial and health-care power of attorney for most people.
Ben Neiburger: Exactly. So you're going to have one that's going to help people
implement health decisions for you. And remember, these only
come into effect when you're no longer able to make the decisions
for yourself.
Christine Benz: And that's in a doctor's judgment, usually?
Ben Neiburger: It depends on a lot of different things. But generally, you'll know
when somebody can't make their own decisions, or their decisions
are very, very poor, usually after dementia has set in for a while.
But they need to have the health-care power of attorney so that
they can tell the doctors what to do, and the health professionals
what to do.
And whoever is the person's agent under the power of attorney,
that is, the person who's doing things, can also have access to the
health information, because then they can direct the long-term care
funds towards the correct amount of health care.
In addition, the long-term care comes and it goes into their
checking account. You need to have a power of attorney for
finance, also called a power of attorney for property, to be able to
dip into the checking account, to write checks to pay for those
bills. And having the correct person acting under the powers of
attorney is important to make sure that your money is safe.
And I also would not have the kids just as joint tenants on the
accounts, because sometimes the balance in those accounts could
be subject to the children's creditors. If there's a joint tenancy that
means you're both on the account. There are other ways to deal
with the account to avoid probate, but that's another discussion.
Christine Benz: Right, so you want one person, typically, to be the agent for the
financial power of attorney, and you want that person to be a
financially-sound, decision-maker themselves.
Ben Neiburger: What you'd like generally is the same person as the agent under the
health care power of attorney and the financial power of attorney
to avoid fighting.
Christine Benz: But they can be different.
Ben Neiburger: They absolutely can be different. And if you have a family that
gets along under stress, it's fine. But you have to make sure either
that the person is financially-savvy, or they know to hire
somebody, to bring somebody in to help them be savvy. Not
somebody who, just willy-nilly, throws money around, or spends it
on anything, or doesn't make wise decisions, but somebody who
can either educate, or hire the people to help them make the right
decision.
Christine Benz: So one last question. Should geography play a role in selecting
these agents? So with the health care, for example, would it help to
have someone who's near?
Ben Neiburger: Sometimes. A lot of things can be done by telephone. Of course, it
is hard to manage things, especially health care from far away. It's
very difficult, but you can get people on the ground to help you do
that.
Now if you have two children who you trust equally, one's in town,
one's not, of course, you're going to pick the one who's in town. If
the one that's closest is not responsible or is squeamish about
medical decisions, you want to use the far one. It's key to have the
right person do the job. It's helpful if they're close, but it's not
necessary--e-mail, fax, and phone work just fine.
Christine Benz: Well thanks, Ben, for some helpful guidance on some tough issues.
We appreciate you being here.
Ben Neiburger: Thank you for having me.
Christine Benz: Thanks for watching. I'm Christine Benz.