Money Management

What is a Personal Representative?

When ONE is Better than TWO

A more common name for what we used to call an “Executor” of a Will is now a “Personal Representative”. In multi-child families, many parents may appoint two (or possibly all) of their children as the Personal Representatives of their Will. They do this perhaps to not show favoritism towards one child or another or maybe their thought is that the Personal Representative’s role would be less of a burden if more than one of their children was named to that role. This is often a concern if the named Personal Representatives live a great distance from the each other or if there are communication difficulties among any of them.

The wording of the Personal Representative’s appointment is best stated as something like “I appoint my son Bob to by my Personal Representative but if he is unable or unwilling, then I appoint my daughter Mary to be my Personal Representative”. The actual wording should ideally be suggested/prepared by the parents’ lawyer who may have prepared their Will and the appointment wording may vary from that used in this example. It is best to name a sole Personal Representative but to also include verbiage that permits the opportunity for others (if applicable) to optionally assist the named sole Personal Representative where needed and for them to work under the direction of the sole Personal Representative.

Why only one Personal Representative? A Personal Representative has “complete and full authority” over all matters of the estate. The major concern with two or more Personal Representatives to a Will means that all must act together on all aspects of decision-making, sharing of information, Probate issues, documentation, insurance, banking, investment and legal matters. We can easily imagine that multiple Personal Representatives could easily become a major concern and incur more than normal charges, delays, confusion and misinterpretation to the activities of the role. Settling an estate can be an emotionally charged and stressful exercise even for those who may be fully prepared to do the work.

When asked if you agree to be named as a Personal Representative to a Will, confirm whether you are the sole Personal Representative before giving your consent to the owner (testator) of the Will. If there are Co-Personal Representatives, it is best to quickly confirm that the named Personal Representatives agree that they can work together. Ideally one of them would agree, with the consent of the others, as the lead.

If there is any reason to believe that any of the Co-Personal Representatives might have communications difficulties with the others for any reason, the named Personal Representative should discuss his or her concerns with the other parties and recommend that only he or she manage the Estate. There may be some activities that the other parties can do under direction of the named Personal Representative who would direct their capacity to assist.

In the case where all parties named as Co-Personal Representatives to a Will agree that only one of them should act as Personal Representative, they should submit a Renunciation of Executorship form that can be drawn up by the lawyer for the estate. As is obvious from this discussion, it is always best to confirm the nature of the appointment of the Personal Representative with the Testator before providing your agreement and consent to act as their Personal Representative.

If you are asked to be a Personal Representative and accept the responsibility, it is important to know how the Will describes your role. Based upon the above, and your knowledge of any other parties named, you may recommend to the testator that he or she make any necessary changes to it as per the above discussion and communicate their decision to any others (e.g. family members) who may feel they too should have a role. This would save you, as the Personal Representative, much grief when the time comes for you to step in and manage the final Estate. During the execution of your duties, keeping beneficiaries informed of your progress will provide a more positive outcome for all involved.

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Voluntary Purchases and More

Although many people buy a lottery tickets every now and then, few win any of the major prizes yet they continue to buy these tickets and jokingly refer to it as paying a “Voluntary tax”. In a similar sense, people can easily be convinced that the little gizmo they just saw advertised on TV is exactly what they need. Human nature has shown that many people have the tendency to ‘collect’ items even though they do not need them now or in the future. This latter voluntary purchasing activity is more common among elderly individuals who live alone or with a partner, and still manage or attempt to manage their own financial activities. It is very easy for a competent marketer or advertisement to convince some seniors that a particular item or subscription is exactly what the senior needs.

We can often assume that such behavior by itself does not impact the individual’s bottom line too greatly but the activity can lead to misuse of funds that could be better used to serve other of the senior’s needs. As the activity becomes more of a ‘habit’, the senior may not realize that he or she may need to cut back on purchase of other items or services so they can still make their “purchases”. In some instances, this may mean not paying off their credit card each month or not doing something else that is more important in their daily lives. Some seniors may have more credit cards than is reasonable and use each of them to support one or another aspect of their growing habit.

Unless the senior(s) in this situation have a trusted son, daughter or friend who is in frequent enough contact with them to notice their behavior, they will continue their negative behavior. Even if the individual has family, they may not live close by and not visit frequently enough to first, notice the behavior, and second, to assist the individual in an attempt to change this behavior. It may be possible that a family member is close by but that person may not be able to help and there are few organizations available to help the individual until the problem becomes so great that it manifests itself more severely. Simply stated, a problem sometimes needs to grow to a size that others (e.g. a Doctor, Minister, bank teller, good friend, etc.) can take notice and hopefully, offer options of help.

One way seniors can get the help they need is to have an assessment of their overall financial and estate matters done for them. This would also help simplify their day-to-day financial activities and ensure they have their “Life Documents” (Will, Power of Attorney, Health Proxy, etc.) in order. Often times, all it takes is for a trusted individual to examine the situation and make recommendations for improvement. This service, if provided by a Financial Concierge™, would perform a preliminary review of a senior’s financial activity and work with with one or more named trusted relatives or acquaintances to help identify and resolve these issues. A Financial Concierge™ could, in consultation with the senior, offer a brief quarterly or other timely visit with the senior and their trusted contact(s) to ensure the plan made to help the senior is working. In some cases, a Financial Concierge™ could assume the role of the trusted contact if the senior does not have family or friends who could assume this role.

In summary, the above course of action is of value for seniors who are cognizant and to their Executor(s) who would encounter fewer problems when the senior eventually passes away and their estate is processed. If a senior has a surviving partner, this service would prove invaluable to them as they carry on their life after the passing of their partner. Family members and most specifically the Executor(s) of a final surviving senior, would benefit from the exercise because, their being involved earlier would prepared them to execute their eventual duty. The living senior would have the satisfaction that their final wishes would be handled after their passing by the people they had appointed and trust.

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OOPS Moments

As we approach each day and use the services of banks, insurance companies, utility companies, government agencies and a variety of service companies, we expect them to always “do things correctly” and occasionally find out that this is not always the case. Unfortunately, even the most astute individuals cannot catch these “oops moments” quickly enough to have them immediately corrected or at least to have their effect mitigated. Those who use the services offered by these organizations may also be the inadvertent cause of what may appear as an errant charge on a monthly invoice.

That is not always the case as there have been anecdotal examples of Executors discovering the payout of insurance policies at amounts not as specified in the policies. Some seniors who have worked for a single employer for their entire career may have a term insurance rider appended to their pension. The insurance company pays the policy amount when the senior passes away but the senior may have forgotten about such a policy and therefore updated it with respect to named beneficiaries. If no beneficiaries are named or there are no surviving beneficiaries, the proceeds would be payable to the senior’s estate.

Most seniors in their late seventies or beyond are generally not computer savvy.  They may not even have used a computer during at least the last few years of their pre-retirement employment. While possibly having a computer at home, they may not take advantage of electronic banking and other such services. As well, perhaps they are not able to manage their financial affairs properly. So long as they do not have any bounced cheques, they feel comfortable. Their sense of financial well-being may simply be that they receive their pension, annuity, OAS, CPP and possibly other income each month while they pay their bills at the end of the month. Those seniors who have a financial advisor may not discuss their day-to-day financial activities with their advisor but simply ask that their investments provide a certain monthly income in addition to anything else they may have.  These seniors have some vulnerability with respect to their day-to-day financial activities for such incidents as erroneous charges on their credit cards, interest payment charges on a missed or late charge card payment, inadvertent sign-up to a subscription, etc.

While cognition changes vary with age and does not affect everyone in the same way, we can generally assume that the possible lack of occasional review of accounts is more prevalent among seniors than for the rest of the population. Such a review as could be performed by a Financial Concierge™ providing assurance to not only the senior but to their family or other parties they would designate that the senior’s affairs are in order. Ideally, the situation would encompass the senior’s Personal Representative (previously Executor or Executrix) and Enduring Power of Attorney (often the same individual) so they can arrange to work with the senior (often their parent or parents) to ensure the account of financial and related affairs is kept current. This would be of great help to them when they process the estate years down the road.

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Company Helps to Untangle your Financial Web

Jan RoSe wrote this great article about our company! It helps explain how Financial Concierge Inc. can provide seniors with peace of mind around management of financial affairs.

The article was published by Calgary Prime Times. Which is a monthly publication containing articles of interest to boomers and seniors, special columns and lifestyle features such as travel, health and finances. It can be picked up at convenient locations around the Calgary and southern Alberta.

Company Helps to Untangle your Financial Web

Written by Jan RoSe

Did your partner or spouse leave you with an estate puzzle after passing away, or suffering a decline in cognitive function?

Whatever the reason, it may fall to you to inventory a possible multitude of unfamiliar documents formerly handled by your partner or spouse dealing with bill payments, disposition of assets, maintaining trust and legal accounting matters and more. And that could only be a fraction of the total.

Or consider a situation where the executor of a will lives thousands of miles away and can’t attend to matters. What then? Who will undertake the formidable task of organization, paying bills, dealing with creditors and other similar duties?

As Jill Chambers, co-owner of Calgary-based Financial Concierge Inc. puts it, in situations such as those the survivor “could feel like a deer caught in the headlights.”

The company, which opened its doors in January, is the only one of its kind in Canada. Similar firms are commonplace in the United States and are often part of the American Association of Daily Money Managers.

“We do not sell insurance or manage investments,” explains Chambers. “What we do is go in and appraise the situation and give the client an estimate of the project’s scope and the time involved.”

Service offerings include organization of personal and financial documents, ongoing bill payment and statement reconciliation, acting as the enduring power of attorney and assisting with estate administration.

A request for document organization is often the first point of contact. Here there may be numerous investment and bank accounts. Are they all active? Could they be simplified or combined?

With insurance policies, are they still in force? Are these still the desired beneficiaries?

A key activity is determining if there is a valid will, enduring power of attorney and a personal directive. Who are the individuals named and how can they be contacted? Who are the other trusted advisors – lawyer, accountant, insurance agent, investment advisor? What are the final wishes? Who will be responsible for the pets? The questions go on and on.

Copies of other important documents are collected such as driver’s licence, healthcare card, passport, and social insurance number, death or divorce certificates.

And lastly, what is the client’s online profile? If no one has access via your login and password, you will be circulating in cyberspace forever. There is nothing eerier than receiving a Facebook friend request from a deceased person.

Once all of the pertinent documents are collected a “Family Playbook” is created in both a hard copy and computer formats.

Chambers’ background includes extensive experience as a nurse in healthcare working with seniors and vulnerable individuals for 30 years. She is also certified financial planning professional, a chartered financial divorce specialist, and has her certified investment manager designation.

“Trust is huge for both the senior and their family” says Chambers. “Our goal is to provide peace of mind around management of financial affairs”.

Financial Concierge Inc. as might be expected carries professional liability insurance. Staff are vetted for working with vulnerable persons through Calgary Police Services and also must have a good credit rating. Financial Concierge Inc. recently was accredited by the Better Business Bureau.

For the full publication head to over Calgary Prime Times.

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Deep Aging and Solo Agers

What is “Deep Aging” and “Solo Agers” ?

Deep aging is generally understood to be the period of aging when most people are not very mobile and need some assistance with their activities.  It occurs at different ages for different people, but for those who live into their 90s and 100s, it is experienced somewhere in those decades of life.  Since more and more of us can expect to see those years it is important, especially for those aging alone, solo agers, to do some planning for that time.

Six Key Planning Targets for Solo Baby Boomers’ Deep Aging

  • Emotional support
  • Residential decisions and transactions
  • Medication management
  • Investments and financial decisions
  • Legal representation
  • Money handling and bill paying

As a Financial Concierge™, We are focused on the last three.

  1. Money Management

Adam took over his eighty-nine-year-old mother’s finances after she had a debilitating stroke.  Even before the stroke she had started to talk about giving up her driver’s license and was asking Adam to help her with household tasks on a more frequent basis.  When the stroke occurred, she became unable to speak or write for four months.  Adam recalls that having her enduring power-of-attorney “EPA” was a lifesaver.  The EPA allowed him to get his name added to all her accounts, manage her income, pay her bills, file her taxes, and wade through the mountain of bills and statements that arrived daily.  He was also able to arrange for her in-home care and to offset out-of-pocket expenses that occurred in the first few days of her hospitalization for himself and his other siblings.  After his mother recovered most of her mobility and some of her speech, Adam continued to manage her finances, and his mother expressed relief and gratitude that she had someone to take over for her.

How would a solo ager manage in these circumstances?  Would there be another relative or friend to rush in, make decisions, pay the bills and manage the accounts?  Without an enduring power-of-attorney, this would have been difficult even for Adam as her son.  Solo agers need to select a trusted relative or friend in advance to be ready to take on these kinds of responsibilities in the case of temporary or long-term incapacity.

  1. Investments and financial Decisions

As time goes on, some older adults begin to feel they are gradually losing touch with the ever-changing realities of the outside world.  Will that happen to you?  No one knows. At eighty-five or ninety, a person’s mental faculties are often not all they once were.  At that point, a capable and trustworthy relative, friend, or fiduciary can take over some or all of the financial decisions—maybe handling the investments and doing the income tax calculations—if the solo ager has had the foresight to plan ahead.

  1. Legal Representation

When you make an estate plan––one that includes a long-term care plan––it should include a enduring power-of-attorney (EPA) for financial matters and a personal directive for health care decisions.  An EPA allows the person you name to have legal proxy for all decisions in the financial domain, meaning their signature is treated as your own.

Solo agers often stumble in this area. What relative or friend should be selected?  Sometimes the best choice is a professional, an outsider. T his is not only a reasonable choice for solo agers; it is often the choice of older adults who are parents.  Almost all parents love their children but they don’t always trust them to do the right thing during a crisis.

This kind of planning requires good communication with the relative or friend the solo ager wants to name.  Sometimes the one selected is not interested in taking on that kind of responsibility.  In that case it is often in the solo ager’s best interest to engage a licensed professional fiduciarydaily money manager, or private guardian to entrust with a power-of-attorney and specific instructions.

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