Estate planning

Q&A: Choosing the right health care agent

May 19, 2025 By Liz Weston 1 Comment

Dear Liz: There is a lot of dysfunction and drama in my family so in my will, I’ve named a friend to be my executor. But I don’t think she’s the best person for my advance healthcare directive. She’s too nice and I think she would cave under pressure from my family. Can I choose someone else?

Answer: Absolutely, and often that’s the best choice.

Your executor is the person who will settle your estate after you die. You should pick someone you know to be trustworthy and diligent. The executor (or successor trustee, if you have a living trust) doesn’t need to be a financial expert, since they can use estate funds to pay for legal and tax help.

The person who makes healthcare decisions for you may need another set of skills. They may face considerable pressure from others, including family, friends or the medical establishment, so you’ll want someone who not only understands your wishes for end-of-life care but who will fight to carry them out.

Your advance care directive or living will is the document where you articulate your wishes for the care you do and don’t want at the end of your life. You’ll also need to create a medical power of attorney, which is where you name the person you want to speak for you if you become incapacitated. Even a detailed advance care directive can’t cover every circumstance, and the power of attorney will help ensure that your chosen person can advocate for you no matter what happens.

You’ll need one more document, which is a financial power of attorney. This names someone who can pay your bills and otherwise handle your finances if you become incapacitated. You can name your executor, the person you named for healthcare decisions or some other person to serve this role. Check with your financial institutions, since they may have their own documents they’ll want you to use.

If possible, you should name at least one backup for each position, since people may not be able to serve when the time comes. Also, your wishes or circumstances could change over time, so all these documents should be reviewed at least annually and updated as necessary.

Q&A: Financial institutions reject powers of attorney

April 28, 2025 By Liz Weston

Dear Liz: I read your column about the parent who unexpectedly had to take over for their incapacitated son. You suggested every adult have a power of attorney and healthcare proxy. Excellent advice! However, as I discovered in dealing with my father’s illness and estate, these general documents are not always recognized by the very institutions they were designed for. His bank, mortgage company and health insurance company would only recognize their versions of these documents.

Fortunately, while he was still able to, I was able to procure each of these documents with his signatures on them but it was very stressful at a difficult time for all of us. I would suggest you amend your advice to people to check to see if their banks and so on also require their specific forms.

Answer: Financial institutions are supposed to accept properly drafted powers of attorney, but some of them insist on their own forms, agrees Burton Mitchell, an estate planning attorney in Los Angeles.

“Sometimes one can get around these rules by appealing to higher ups in the organization, but it is unnecessarily difficult, time-consuming and complicated,” Mitchell says.

Checking with your financial institutions now could avoid hassles later.

Q&A: When money disappears from a mother’s estate

April 28, 2025 By Liz Weston

Dear Liz: My mother recently passed and my sister is handling all the legalities. At one point, my sister mentioned our mother had a sizable savings account plus two retirement accounts valued at $400,000, and that I would receive something. Now she is simply saying, “I don’t know where the money has gone.” She handled all my mother’s finances for years before her death. How is this possible? I can’t hire an attorney, nor do I want to alienate my sister or seem greedy. What should I do?

Answer: If your sister handled your mother’s finances for years and she’s settling the estate, then she almost certainly knows where the money went. Why she won’t tell you is the mystery.

Your mother’s money may have been eaten up by long-term care expenses, which can be breathtakingly expensive. That’s especially true if there was a long gap between your sister’s disclosure about the accounts and your mother’s death.

If that were the case, though, your sister could just say so.

There are many other possibilities. Your mother could have been scammed, or gambled away the money, or been the victim of financial elder abuse. Abusers are often people the elders know, including relatives and caregivers.

Perhaps your sister didn’t help herself during your mother’s lifetime, but arranged to be the beneficiary of all the accounts, either with or without your mother’s consent.

You don’t have many options if you aren’t willing or able to consult an attorney, but you wouldn’t be greedy to ask for some clarity from your sister.

Q&A: Credit card debt doesn’t disappear when you die

April 14, 2025 By Liz Weston

Dear Liz: I am an 80-year-old female in generally good health. My only family is my unmarried 54-year-old son. The only debt I have is credit card debt of about $30,000 at 0% interest. It’s in my name alone. My house and car have been registered with “transfer on death” designations. My son’s name is on my modest checking account. When I die, is there a legal situation where he would be required to pay the credit card debt? There will be no probate.

Answer: Credit card debt doesn’t just disappear when you die. The debt would become the responsibility of your estate. Transfer-on-death options avoid probate, the court process that otherwise follows death, but creditors can still go after the property that’s been transferred.

Depending on state law, creditors may have longer to make their claims than if your estate had gone through probate or if you had used a living trust, says Jennifer Sawday, an estate planning attorney in Long Beach.

That’s among the reasons why transfer-on-death designations may not be the best solution. Consider making an appointment with an estate planning attorney to discuss your situation and possible alternatives.

Also, your 0% interest rate is temporary. Once the current teaser rate ends, you’ll likely pay a much higher interest rate and your monthly payments could jump. If you can pay off this debt, that’s probably the best course. If you can’t, you may want to discuss your situation with a bankruptcy attorney.

Q&A: Successor trustee can use estate funds to hire help

March 31, 2025 By Liz Weston

Dear Liz: I have named my daughter as executor of my revocable living trust. I am concerned that she may not have the ability to carry out all of the functions required of an executor. Are there entities she can hire using trust funds to fulfill her duties?

Answer: Technically, an executor is a person who settles an estate through probate court. Because you have a living trust, your estate should avoid probate court, and your daughter’s role is known as a “successor trustee.”

The jobs of executor and successor trustee are much the same after a death. They’re required to inventory assets, pay your final bills, file your last tax returns and distribute your assets according to your estate documents. Both executors and successor trustees are allowed to use estate funds to hire any help needed, including an attorney and a tax pro. If you’re already working with professionals you trust, make sure she has their contact information.