The elderly are a vulnerable population. The wealthy elderly, however, are even more at risk. It is not uncommon to hear horror stories of an elderly parent who marries their caretaker only to have their life savings steadily funneled to unknown sources, discovered only by family members after the death of the elderly. As baby boomers head into retirement, these “predatory unions” are on the rise, as highlighted recently in the Wall Street Journal.
Financial abuse is the theft or embezzlement of money or any other property from an elder. It can be as simple as taking money from a wallet and as complex as manipulating a victim into turning over property to an abuser. In the blink of an eye, an elderly parent may be left unable to provide for their own needs while children and family members may be left without an inheritance.
The most difficult challenge for the children of these elderly is objecting to the property consequences of a parent getting married once that parent dies. In most states, the inheritance rights of widows and widowers trump any estate plan—even if the new spouse wasn’t named in the will, and even if the marriage took place shortly before the death of someone unable to recall the union a few days later. In California, the inheritance rights of widows and widowers are substantial but not as extreme as those previously mentioned. The surviving spouse may receive up to one-half of the decedent’s community property, quasi-community property and separate property.
Estate planning, however, can still be a strong deterrent to elder financial abuse if drafted properly. Estate planning devices may include wills, trusts, powers of attorney, advance health care directives and joint tenancies. Children whose parents put their assets in a trust have a stronger line of defense when the parent marries late in life. Irrevocable trusts cannot be unwound during the parent’s life time, however, if a revocable trust is in place, the paid caregiver should not know about it.
If you are interested in learning how to better protect your own or loved one’s assets, please contact the experienced estate planning attorneys at Lonich Patton Erlich Policastri for further information. Please remember that each individual situation is unique and results discussed in this post are not a guarantee of future results. While this post may include legal issues, it is not legal advice. Use of this site does not create an attorney-client relationship.