In our previous post we explained how Great Plains Trust Company has implemented some new procedures to prevent financial exploitation of our customers, particularly in the case of diminished capacity. While safeguards put into place by Great Plains and other financial institutions can be helpful to prevent fraud, there are important steps that you can take yourself to help minimize future problems for you and your family.
- Organize and store important documents in one safe location. Be sure to give copies to trusted loved ones or make sure that they can access the documents. Important documents that are most relevant to finances are: bank and brokerage statements and account information, mortgage and credit information, insurance policies, pension and other retirement benefit summaries, social security payment information, contact information for financial and medical professionals. Be sure to keep this information updated.
- Use a Social Security Advance Designation to select up to three people as your “representative payee” if you need help with social security benefits in the future. You manage your own benefits as long as you are able.
- Create a durable financial power of attorney that appoints someone you trust to make financial decisions for you if you cannot. Ideally, everyone who is over the age of 18 should create a financial power of attorney so that your spouse/children/parents or whomever you appoint can assist you with financial matters if needed. Creating a power of attorney does not take away any of your own authority to act but rather appoints someone that you trust to assist you when needed, whether that is in the case of permanent incapacity or whether you need someone to speak with your bank while you are in the hospital recovering from an accident or illness. In the case of incapacity/diminished capacity when there is not a power of attorney in place, a court proceeding will need to take place where the court will appoint someone to handle your financial affairs for you.
- Consider involving a trusted relative, friend or professional by giving them an overview of your finances while you still have capacity. You can share as much or as little detail as you wish, but sharing at least the basic information will be helpful if and when you are unable to manage your finances.
- If you think you have been the victim of fraud or financial exploitation, speak up. Many of these criminals are very savvy, and there is no shame in admitting that you may have fallen prey to their tactics. If you want to learn more about common scams and warning signs, or if you have been the victim of elder fraud, you can call the National Elder Law Fraud Hotline (833-FRAUD-11 or 833-372-8311). This hotline is staffed with trained volunteers who can help victims age 60 and older file reports with agencies such as the Internet Crime Complaint Center and the Federal Trade Commission.
Because we cannot anticipate whether our financial capacity will decline over time—or even suddenly, such as with a severe stroke—planning ahead for possible incapacity is critical.
