Mark Harvey — The perfect time to talk about money


The question was, “Who will do all the stuff that needs to be done, if/when I can’t do it (and there’s no family)?” And it seemed to me that the “stuff” came down to three things:

1. Medical decisions, in case you can’t make your own;

2. Long-term care/help at home, and …

3. Money!

And since the Ides-of-April deadline for taxes was four days ago (unless you got an extension), this seems like the perfect time to talk about … Money!

In the original e-mails that came to me that started us all on this little excursion, here’s what was said:

“… What are the options … beyond a will that leaves everything to PBS or a college or a friend? How does one arrange a trust in which a trusted someone would manage his money, rent or sell his house, then pay out to people he designates for, say, 10-30 years? Is there a way for him to control what happens to his money/goods after his death? (Or, say he was ill with cancer and unable to do anything.)”

Now, if you read that through a few hundred times, like I have, you realize that there are two very different questions there so, as is my way, let’s work backwards, starting with the parenthetical “… or, say he was ill with cancer …”

It seems to me that we’ve largely covered this piece in the last few weeks, talking about entities who can manage money, pay bills, provide/supervise assistance, etc. because you (for whatever reason) can’t, so I’m going to step around that and go straight to the part about managing money and assets after you’ve moved on to a non-financial “just reward.”

TIME OUT: In my experience, and in my opinion, discussions like this can often get so involved in the “how-to’s” that they become little more than an entertaining exercise in mental gymnastics, which is fine, if that’s what you’re in the market for; but I tend to think that we need to think: What, exactly, is it that we’re wanting to accomplish, with money and assets, after we’re dead? What do we want to see done that couldn’t be done by simply leaving the stash to a judicious and/or trusted person/entity and say (by default), “Here you go — YOU manage it?”

Usually, the scenario that fits is one in which there is a person (Spouse? Partner? Child with disabilities?) who, for whatever reasons, couldn’t manage the assets themselves, but (in your opinion) will need ongoing financial support, and you want to know that it will be available and provided. If something like this is your GOAL, then you are probably looking for a “trust” and, in all probability, a “revocable living trust.”

A revocable living trust is an arrangement you arrange for the management and distribution of your property, which includes money and assets. Like a will, the trust is “revocable,” which means that you can modify or eliminate it anytime you choose to.

These trusts appoint a “trustee” (Bank? Trust company?) to administer the property, with detailed instructions as to how it is to be managed and distributed; then, all trust assets need to be legally transferred to the trustee. You can add up to $100,000 in assets to the trust at your death, and can probably arrange to have life insurance and certain pension accounts paid directly to it.

It gets a lot more complicated than this, but the point is that it can be done — and is done — every day, but I’m not done putting in my nose in it.

I’m not a huge fan of trusts for most people most of the time, simply because (a) Washington’s probate system is among the simplest and least expensive in the nation, so if that’s a primary motivation for you, think that through and do your homework, and (b) I’ve seen way too many people spend way too much money on some very pretty paper (“trusts”) and about all they really got out of it was some very pretty paper.

You will also pay fees to set all of this up, and the trust, of course, will pay fees to the trustee to stay on top of all this and manage it and distribute funds and blah blah blah — which is only fair; so, ask yourself again, will this get you where you want to go?

Is a “special needs trust” closer to what you want to accomplish?

And, remember, trusts can be a minefield if, for whatever reason, Medicaid is or could ever be a part of the scenario you’re envisioning.

I’m going to stop here, because I am NOT qualified to get into a detailed discussion of the details of trusts. If that is the way you feel you need to go (and plenty of people do), then you need to be sitting with attorneys and certified financial planners and other professionals who really know what they’re talking about. Please just be darned sure that whatever you end up buying is something you actually wanted.

For most of us, most of the time, we can do what we want to do by simply thinking through what we want to ACCOMPLISH. What is the desired OUTCOME? Then, being smart about how we draft wills or manage our assets in the here-and-now.

I’m going to declare us “done.” The bottom-line from the last few weeks is that there are ways to do pretty much whatever we want to have done, or need to have done, and there are individuals/entities/businesses that will do whatever it is, on our behalf. Will everything be perfectly perfect? Probably not, but you can get darned close, remembering that this is Earth.

I think the better question, again, is not so much “how,” as “what?” What do you want to accomplish? How do you want that to go? Who are you trying to help? Those are the “life questions” that only you can answer, because it’s your life.

When you figure that out, then it’s just a matter of mechanics, and there are plenty of mechanics.

Last thought: Think, plan, PREPARE! Have the conversations! But don’t let preparing for death or disability rob you of the most important things you have: Life and time. Love and laughter. Today.

Because those are the easiest assets to manage! And the easiest to waste.

Mark Harvey is the director of Information and Assistance for Olympic Area Agency on Aging. He can be reached at harvemb@dshs.wa.gov or 532-0520 in Aberdeen, (360) 942-2177 in Raymond or (360) 642-3634. FACEBOOK: Olympic Area Agency on Aging-Information &Assistance.

 

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