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Tuesday, August 11, 2009

Does your aging parent need a trustee?

About a month ago, I posted about how to tell if your ageing parent needs a guardian and promised to follow up with a post about how to tell if your parent needs a trustee. So here I am, keeping the promise.

When I talk about trusteeship, I am referring to a court-ordered person who will be legally responsible for looking after the parent's finances and property. Trusteeship does not give anyone legal rights to make personal decisions such as health care.

If your parent has a valid Enduring Power of Attorney (also called Continuing Power of Attorney), then it is unlikely that a court-ordered trusteeship will be needed. An attorney under Power of Attorney has similar duties and responsibilities, so you could also use the following list as a way of deciding whether an Enduring Power of Attorney needs to be invoked.

Some indications that your ageing parent might need a trustee to make financial decisions are that he or she:

- has been taken advantage of financially by scam artists, strangers or family members

- answers the door to strangers and is susceptible to being taken advantage of by them financially

- is making irrational changes to his or her will

- is transferring assets to friends or family members for no apparent reason, such as selling property to them for less than market value or placing bank accounts in joint names

- forgets to pay bills, resulting in essential services such as phone, heat or water being disconnected

- forget that he or she has already paid bills and pays them repeatedly

- misplaces money, pension cheques, bills or important paperwork

- cannot manage small financial transactions such as store purchases or restaurant meals that he or she used to be able to manage

- forgets to complete tax returns or is unable to do them on his or her own

- does not know how to live within his or her means

- makes irrational, unnecessary purchases such as buying cans of dog food when he or she does not own a dog

- makes large cash withdrawals for which there is no corresponding purchase or bill payment and cannot recall where he or she spent the money

- has made a recent friend - usually of the opposite sex - who seems to exert a lot of influence on him or her

This list is condensed from a chapter of my book called "Protect Your Elderly Parents". If you recognize your elderly parent or other relative in this list, make sure that you work with the parent's doctor to determine whether capacity is beginning to diminish. If you are not a doctor, it is difficult to know what these behaviours mean or why they are occurring.

Unfortunately, some people try to control the decisions made by elderly parents when those parents make decisions that the adult children don't like. Adults don't need the approval of their family members to spend their money or otherwise use their assets, and neither do your ageing parents. Plenty of us have friends who choose to use their money for gambling, risky investments or expensive leisure equipment and we don't interfere. It doesn't mean those people have lost mental capacity. Everyone has the right to spend his or her own money in ways that may look odd to other people. The same attitude should be extended to your ageing parents. It's only when the parent's ability to make decisions is affected by memory loss, disorientation or the influence of other people that their decisions should be called into question.

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