If you are a person who plans, you have likely spent a lot of time, effort and money to make sure your estate plan is exactly like you want.   If you are fortunate enough to live to be quite elderly, it’s likely you will need a caretaker to help with household chores and errand running.   Choosing the wrong caretaker can kill your estate plan.

Why choosing the wrong caretaker can kill your estate plan

A sure way to kill your estate plan, to put it bluntly, is to live to be really old and choose the wrong caretaker.   The wrong caretaker is one who is basically untrustworthy and who may have an agenda from the get go to steal from you.  I’ve had this happen to some of my elderly clients and the aftermath was very bad.  The correct wording for this problem in our society is financial abuse of the elderly and the problem is growing.  It happens to all types of people in all sorts of situations.

Could this type of theft happen to you?

This could happen to you once you get to an advanced age and decide you need to get some help in your house.  Someone who will work for a fairly low hourly rate (or even work for free) is a huge red flag.

Once hired and in the home on a regular basis, the wrong caretaker will work to endear herself to you.  She may go out of her way to help with things not specifically on the job list.  She does things for you on her own time, or brings you small bouquets of flowers or sends cards.  The caretaker remembers to call on birthdays and may invite you to her house for major holidays.  She will also cook for you and, once she learns your likes and dislikes, brings you favorite items from the grocery store.

How does this escalate into an estate killer?

Here is how your situation could get out of control with the wrong caretaker:

1) you begin to consider the caretaker a friend (or worse, a daughter).  This goes on for some time and gains momentum the longer the caretaker is around.

2) the caretaker steals banking information and pads of checks while you are napping or watching TV.

3)  the caretaker takes your car for convenience, since you aren’t driving any more.   She may get you to sign over your car title.

4)  the caretaker admires your silver flatware (or other items).  She mentions how she would love to have it, since it isn’t being used anymore.  You feel pressured to give the item to her since she’s spent money out of pocket on you.

5)  you feel dependent on her and begin to fear losing her.  As an incentive you pay her a  lump sum to guarantee she will stay on.

6)  you begin to think that she “deserves” payment for all she does for you, and you are persuaded that she deserves a part of your estate more than your ungrateful (and distant) relatives.  You name her as beneficiary on your life insurance policy.   [I’ve seen an insurance agent even help with this one]

7)  the caretaker claims to have done tasks for you and accepts payment for those jobs.

Unfortunately, I’ve seen all of the above happen to clients.  These clients were good investors and money managers all of their lives.  But once confidence and access was given to the wrong caretaker, money and property flew out the door, which killed the client’s estate plan.  Clients were scammed out of cars, money, life insurance policies and even groceries.  Yes, some caretakers may actually steal groceries from you.

What factors make you an easy target?

There are a few factors that make you an easy target for caretakers to steal from you as you age:  1) you are living alone at home; 2) you have no close family members to watch over everything; 3) the caretaker is not from an agency; 4) you come to rely on the caretaker to the exclusion of everyone else.

There is a 5th factor at work as well:  You live to be 90 and you lose your ability to judge how much money is in your bank account.  It sounds crazy, since bank statements are issued every month, but something deteriorates in an older brain that may cause you to lose the ability to make sense of the numbers.  I had a client who had about $65,000 in a checking account.  His basic expenses were minimal, and he had no debt.  He still worried whether he could afford an $8 meal at the senior center each week.  I’ve seen this with other clients as well and they are typically in the upper 80s.  Some are afraid of running out of money even when shown on paper that they have enough to last for years.

How can you avoid choosing the wrong caretaker?

Make sure you have trustworthy people are around you, especially as you age.  They should monitor your bank accounts often, especially if you have a caretaker coming into your home.   If you are unsure about appointing any one person, appoint two people to act together to oversee your accounts.   If you are lucky enough to know you have an absolutely trustworthy person, turn over all banking and bill paying duties to that person.  How will you know this?  This should be someone you have known for years and who has a long history with you, not someone you just met.

Store all financial, banking and estate planning documents away from prying eyes.

Thoroughly check out anyone you are considering hiring.

Consider someone from an agency.  Their employees are bonded and they rotate people in and out of homes.

Taking precautions doesn’t guarantee that you can avoid choosing the wrong caretaker, but it can help avoid killing your estate plan before you die.  After all, once the wrong caretaker takes it all, what is left?  For additional information about financial abuse, click here for more information from the State of Texas.

For more information on how to appoint someone to handle your accounts, go to this page or contact Carla.


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