With Special Steps for Those Living With Chronic Illness By: Martin M. Shenkman, CPA, MBA, PFS, AEP, JD

CaveatsCaveats Nothing in these slides or any accompanying presentation is to be considered tax, legal, investment or other professional advice. The information is merely provided for educational purposes and no action should be taken without the individual consulting his or her own tax, estate, legal, financial, investment, insurance and other advisers. The hosts and sponsors of this program are NOT responsible for its content or accuracy

What is estate planning? Providing peace of mind for you and your loved ones on a broad range of planning issues Providing peace of mind for you and your loved ones on a broad range of planning issues An integrated plan that coordinates your investments, insurance, emergency and disability planning, and more while you are alive, disabled, retired and for your heirs An integrated plan that coordinates your investments, insurance, emergency and disability planning, and more while you are alive, disabled, retired and for your heirs You have to define what estate planning means to you You have to define what estate planning means to you

Overview of Estate Planning When you Live with Chronic Illness Powers of Attorney Powers of Attorney Springing vs. not Springing vs. not General vs. Special General vs. Special Why standard forms arent suffice Why standard forms arent suffice Special provisions to include Special provisions to include Living Wills Living Wills What they are and why they are important What they are and why they are important Address specific health issues Address specific health issues Experimental procedures Experimental procedures Organ and tissue donations Organ and tissue donations Health Proxies Special considerations in selecting agent What is different for you if you live with chronic illness Revocable Living Trusts Unique importance Boilerplate forms rarely address nuances needed What can and should you have

Introduction to the 12 Steps Every person is unique – it has to be your plan and address your challenges Every person is unique – it has to be your plan and address your challenges Reflect your personal wishes and circumstances Reflect your personal wishes and circumstances Create a strong foundation of documents, steps and a plan to build upon Create a strong foundation of documents, steps and a plan to build upon

Action Step: 12 Steps Begin by Informing Your Advisors Chronic illness affects every aspect of estate and related planning – dont use standard documents or planning steps Chronic illness affects every aspect of estate and related planning – dont use standard documents or planning steps You must explain your circumstances to all of your advisers or they will not be able to guide you You must explain your circumstances to all of your advisers or they will not be able to guide you Larrys story Larrys story Those not touched by chronic illness dont understand the symptoms (96% are invisible), disease course, variability between diseases and among those affected by a particular disease Those not touched by chronic illness dont understand the symptoms (96% are invisible), disease course, variability between diseases and among those affected by a particular disease

Chronic Illness is a Common Challenge 120 million Americans are living with chronic illness or disability By 2020, about 157 million Americans will be afflicted by chronic illnesses 26% of those ages have had their lives significantly impacted by chronic illness 50% of those age 85 and older have had some cognitive impairment 9 million people are cancer survivors with various side effects from treatment Issues affecting those living with chronic illness are important to you and your loved ones

Cardinal Features: Rigidity Rigidity Pill rolling Tremor Pill rolling Tremor Bradykinesia – slowness of movement Bradykinesia – slowness of movement Postural instability – poor balance Postural instability – poor balance

Can be mental and/or physical Can be mental and/or physical Number one reason people with Multiple Sclerosis disease leave the work force Number one reason people with Multiple Sclerosis disease leave the work force Fluctuates during the day Fluctuates during the day

Step 1: Organize Emergency, Financial, Information and Advisors Information Contact People (names, numbers) Contact People (names, numbers) Financial Information (account information) Financial Information (account information) Passwords and Security Codes Passwords and Security Codes Documents (Estate planning documents, legal documents, and more) Documents (Estate planning documents, legal documents, and more) Budget and Plan Budget and Plan

Investment and Financial Information is Critical to Organize and Commuicate Title to Accounts Title to Accounts Revocable trust Revocable trust Joint Joint Other Other Beneficiary designations Beneficiary designations For client assets For client assets Of others that benefit client living with chronic illness Of others that benefit client living with chronic illness Account Management Account Management Duplicate statements Duplicate statements Consolidation and simplification Consolidation and simplification Geographic proximity Geographic proximity Access to safe deposit box Access to safe deposit box Automation Automation Organizing records Organizing records On line payments On line payments Set up on computer so can enlarge visual Set up on computer so can enlarge visual Automatic deposits Automatic deposits

Action Steps: Emergency Info #1 Type up a list on your computer so you can update it Type up a list on your computer so you can update it Disseminate the list to key people, ask for their help and tell them what they might need to do to help Disseminate the list to key people, ask for their help and tell them what they might need to do to help Each professional adviser should have the list in their file Each professional adviser should have the list in their file

Action Steps: Emergency Info #2 Organize the list by category (e.g., banking, religious adviser, professional advisers, family, neighbors) Organize the list by category (e.g., banking, religious adviser, professional advisers, family, neighbors) Give only the key facts someone will need to act in an emergency (person name, institution, insurance, office/home and cell number, , etc.) Give only the key facts someone will need to act in an emergency (person name, institution, insurance, office/home and cell number, , etc.) List info needed for emergency action (e.g., account number, policy number, etc.) List info needed for emergency action (e.g., account number, policy number, etc.)

Step 2: Designate a Person to Handle Financial and Legal Issues Agent (Successors) Agent (Successors) Compensation Compensation Begin date (Trigger) Begin date (Trigger) Powers (Authority) Powers (Authority) Durability (Disability) Durability (Disability)

Action Steps: Power of Attorney Choose a trusted agent and several successors Choose a trusted agent and several successors Hire a lawyer to draft powers that work for your disease course and financial situation Hire a lawyer to draft powers that work for your disease course and financial situation Discuss modifications to standard forms: Discuss modifications to standard forms: –Limited power for short term hospitalizations and broad power for permanent disability) –Compensation –Definition of disability Sign several originals, distribute them, organize and simplify assets so an agent can act easily and safely Sign several originals, distribute them, organize and simplify assets so an agent can act easily and safely Create a monitor relationship Create a monitor relationship

Step 3: Designate a Person to Make Health Care Decisions and Access Medical Records Agent (successors) Agent (successors) Powers (religion) Powers (religion) Signature (State law) Signature (State law) Move (state; facility) Move (state; facility)

Action Steps: Health Care Proxy Choose an agent and several successors who understand your health situation and wishes Choose an agent and several successors who understand your health situation and wishes Hire a lawyer to draft a health proxy that accomplishes your personal goals Hire a lawyer to draft a health proxy that accomplishes your personal goals Sign several originals, distribute them, be sure one is included in your medical chart Sign several originals, distribute them, be sure one is included in your medical chart Discuss your decisions with family, friends and agents Discuss your decisions with family, friends and agents

Step 4: Communicating Your Health Care Wishes

Action Steps: Living Will Review and consider personal wishes that should be reflected, e.g. religious observances, care instructions Review and consider personal wishes that should be reflected, e.g. religious observances, care instructions Hire a lawyer to draft a living will that communicates your personal decisions Hire a lawyer to draft a living will that communicates your personal decisions Discuss modifications to forms: Organ donations – e.g., CNS to foster MS research; Experimental or non-traditional treatment; Pain relief Discuss modifications to forms: Organ donations – e.g., CNS to foster MS research; Experimental or non-traditional treatment; Pain relief Sign several originals, distribute them, be sure one is included in your medical chart Sign several originals, distribute them, be sure one is included in your medical chart Discuss your decisions with family, friends and agents Discuss your decisions with family, friends and agents

Step 5: Protect Your Minor Child With an Emergency Child Medical Form Disclose childs care information Disclose childs care information

Action Steps: Protecting Children Review all aspects of protecting your children with your advisers Review all aspects of protecting your children with your advisers Trustees under a revocable trust while you are alive and disabled and trustees and guardians under your will to provide care Trustees under a revocable trust while you are alive and disabled and trustees and guardians under your will to provide care Financial planning – 529 plans, resources Financial planning – 529 plans, resources Personal letter of instruction Personal letter of instruction Directions in your power of attorney Directions in your power of attorney

Step 6: Sign a Will

Action Steps: Sign a Will Wills are important but if youre facing a progressive chronic illness it is only one step of many and perhaps not the most important step Wills are important but if youre facing a progressive chronic illness it is only one step of many and perhaps not the most important step Include personal letters of instruction Include personal letters of instruction Consider trusts for minor children Consider trusts for minor children Include a donation to charities that have helped you – even modest donations send an important thank you Include a donation to charities that have helped you – even modest donations send an important thank you

Step 7: Create a Revocable Living Trust Establish a personalized (not boilerplate) living trust Establish a personalized (not boilerplate) living trust Transfer assets to a trust during your lifetime Transfer assets to a trust during your lifetime Probate and intestacy Probate and intestacy Manage assets during disability or illness Manage assets during disability or illness

Action Steps: Revocable Living Trust See comments for Wills above and coordinate See comments for Wills above and coordinate Boilerplate Trusts designed to avoid probate wont accomplish your goals Boilerplate Trusts designed to avoid probate wont accomplish your goals Focus of document should be protecting you and communicating your wishes as your disease progresses Focus of document should be protecting you and communicating your wishes as your disease progresses Tailor trustee replacement, disability and other provisions to the nuances of your anticipated disease course Tailor trustee replacement, disability and other provisions to the nuances of your anticipated disease course

Step 8: Be Sure Your Insurance Coverage is in Order Property and casualty insurance Property and casualty insurance Long term coverage Long term coverage Disability income replacement Disability income replacement Life insurance Life insurance Liability Liability

Action Steps: Insurance Coverage Dont make assumptions – get every insurance coverage reviewed at least every 2 years Dont make assumptions – get every insurance coverage reviewed at least every 2 years Evaluate options – Can you convert term life insurance to a permanent policy? Can you sell life insurance in the secondary market to free up cash? Evaluate options – Can you convert term life insurance to a permanent policy? Can you sell life insurance in the secondary market to free up cash? Standard may not work – do you need a rider for home health workers or home improvements? Standard may not work – do you need a rider for home health workers or home improvements?

Step 9: File Beneficiary Designations and Confirm Title to Accounts Standard provisions are not always adequate Standard provisions are not always adequate Coordinate with Revocable Trust Coordinate with Revocable Trust What powers should agent have What powers should agent have Give copies to your advisers Give copies to your advisers Update when banks merge Update when banks merge Revise when tax laws change Revise when tax laws change

Action Steps: Beneficiary Designations Consider all beneficiary designations: life insurance, pensions, IRAs, brokerage accounts and more Consider all beneficiary designations: life insurance, pensions, IRAs, brokerage accounts and more Obtain copies of the forms you filed and blank forms to facilitate revision Obtain copies of the forms you filed and blank forms to facilitate revision Have family members who name you as beneficiary consider a trust for you Have family members who name you as beneficiary consider a trust for you

Step 10: Give Back Demonstrate important values to heirs Demonstrate important values to heirs Thank those that have helped Thank those that have helped Inspire others to give Inspire others to give

Action Steps: To Give Back Make a donation (cash, stuff, insurance) Make a donation (cash, stuff, insurance) Include a bequest in your will – even small bequests can make a big statement Include a bequest in your will – even small bequests can make a big statement Write a heartfelt letter of instruction to heirs and thanks to those that have helped Write a heartfelt letter of instruction to heirs and thanks to those that have helped Inspire others to give that have the wherewithal to do so Inspire others to give that have the wherewithal to do so

Step 11: Communicate Educate and inform your fiduciaries Educate and inform your fiduciaries Preparation of beneficiaries Preparation of beneficiaries

Action Steps: Communicate Explain your finances, family, care, disease, and so forth to your advisers – tell all so they can help properly Explain your finances, family, care, disease, and so forth to your advisers – tell all so they can help properly Discuss with family, friends or others involved in your life what help you might need Discuss with family, friends or others involved in your life what help you might need Can those you expect to rely on really help? Have alternatives Can those you expect to rely on really help? Have alternatives Express your wishes in face to face meetings and then confirm key points in writting Express your wishes in face to face meetings and then confirm key points in writting

Step 12: Review, Revisit, Revise Nothing remains static Nothing remains static –Tax and property laws –Family situations –Assets and net worth –Health