Few estate plans effectively deal with the common situation in which the caregiver, let’s say the wife, dies before her sick husband. How common is this?

Sixty percent of the time, the caregiving spouse dies before the sick spouse. Got that? Sixty percent of the time.

At first, this statistic seems counterintuitive. Shouldn’t the sick spouse die first? But think about it. Who is getting the proper nutrition? Who is going to their doctor appointments? Who is getting all the care? And who is getting worn out caring for the other?

Sadly, we often see this situation in our practice. Indeed, just to repeat the point, we see it more often than not. If you take away the cases in which the sick spouse has a terminal illness, the statistic is even higher.

Let me go back to the case of my grandmother. My grandfather was disabled for many years, and grandma took care of him with wonderful, diligent care. So diligent, that we had a running joke in our family:

“Grandma, let’s go have some fun this weekend.”

“You go ahead,” she’d say. “We’ll have fun when your grandpa dies.”

And we’d all laugh.

Well, she died in her eighties of that massive heart attack

I discussed earlier. He lived to be ninety-three. I think that taking care of him literally wore her to death. I believe she did not take care of herself properly. It’s hard for me to think about it any other way.


Again and again, my firm sees situations in which one spouse, let’s again say the husband, becomes incapacitated, and for a time, the married couple’s lives together go on functioning with some normality. The wife can manage most things by herself. They have joint accounts, joint tenancy in property, and the wife muddles through to make healthcare decisions for her husband. The couple figures that when he dies, she’ll still be in control of everything through their joint tenancy and joint accounts. So, they never get around to a formal estate plan.

But what if the wife suddenly passes away? Now, the husband lies helpless in his bed, without the mental capacity to manage his own affairs, and everything falls into chaos.

Like Jack in our previous example, let’s say this couple has a responsible daughter named Mary. This Mary is also willing to step in for her dad. But without a living trust naming her as trustee, and without a durable power of attorney, poor Mary will have to go to court and petition for a conservatorship. She will have to hire a lawyer. She will have to be investigated and approved.

Like Bob Jr. in Mistake #10, Mary will have to follow through in the same probate court, maybe in the same courtroom, but for a conservatorship. She will have to go to the courthouse and pass through the metal detectors. Thousands of dollars will have to be spent from the estate, not just to pay for the bills, the property taxes, even the funeral for Mom—but for court and attorney’s fees. If the family assets are large, or some other interested party like a sibling tries to interfere, the amount may be tens or hundreds of thousands of dollars.

Meanwhile, Mary may grow frazzled and debilitated herself. She may have to give up a job to deal with this hassle. She may neglect her kids. She may endanger her relationship with her husband. In the Introduction, I said, “It’s Not about the Money (But It Is about the Money).” In cases like this, it may start out about the money, but in the end, it will be about the hassle. People would often happily give up their inheritance to be rid of the burdens which a death or disability has dropped in their lap.

If you have questions about caregiving or how a living trust can benefit your family, attend one of our seminars for a FREE consultation.



Since incapacity before death is an 80 percent probability, you should plan for it. And you should plan to avoid a conservatorship if at all possible.

A conservator, sometimes called a “guardian,” will have much more power than someone with “power of attorney.” Once a conservator or guardian has been appointed over you by a court, you lose your liberty, along with considerable rights over your life. Someone else will tell you where to live, who to visit, and when. You won’t vote anymore. If you are a gun owner, they’ll take away your guns, too.

Once a conservator has been named, he or she will have the power to ask the court to confine you to an institution against your will. They will have the power to make all medical and financial decisions for you, and you will lose the power to make these decisions for yourself and take full control of your affairs.

You may have no input on who is named conservator by a court. Why? Because you will have been found incompetent to make such decisions.

It’s likely that one of Jack’s relatives will be appointed conservator, but Jack could have prevented much of this family strife, hassle, and expense simply by hiring an attorney to create a proper estate plan which took into account the very high probably we all face of incapacity.

If he trusted Mary, he could have named her as trustee for his living trust in case of his incapacity (see below). As trustee, she would have had immediate access to his accounts and his investments. Whether or not her decision to fly him to Boston proved best in the long run or not, the decision would have been made without lawyers, legal expenses, or bitter court proceedings.

Which means there might have been enough money left over to do it right. Plus, everyone might still be getting along.

With a proper estate plan that takes into account disability, people don’t have to argue about who is in charge, and the person in charge has the power to take the necessary and immediate actions.

Let’s look at all the documents you need to put together with your attorney to plan ahead.


Earlier in the book we outlined the basic documents that make up an estate plan. Please flip back to the Introduction for the detailed summaries.

You should consult with an expert attorney because you may need every one of these documents in place, not just at the time of your death, but during any disability.

As I said before, every adult over the age of eighteen should have at least the first three documents below signed and available at all times. Any adult with assets, and certainly any adult with children, should have all the documents available and updated throughout their lives. At a minimum, these documents include:

  •    Durable Power of Attorney for Property
  •    Advance Healthcare Directive (Power of Attorney for Healthcare)
  •    HIPAA Authorization
  •    Living Will
  •    Living Trust
  •    “Pour-Over” Will

As you have seen in the case of Jack and his family, the failure to create all of these documents added considerable confusion, strife, and expense to an already-difficult health situation. It also led to an unnecessary legal process and the loss of his rights through a conservatorship.

Let’s see how these documents function during a disability.


Please do not be confused by the term “power of attorney.” Many clients believe this term has something to do with the lawyer preparing their estate plan. Clients sometimes mistakenly fear that they are giving over some kind of power to their lawyer to make decisions for them. This is not true.

When you grant “durable power of attorney” to another person—any other person—you are designating that person as your agent, to act on your behalf. This may be your spouse, your child, a friend, or anyone, as long as he or she is an adult (eighteen or older) and not under a conservatorship or incarcerated. Now and then, someone may indeed choose an attorney for their agent, which adds confusion to the term.

“Durable” means “continuing even when you are incapacitated.” Indeed, these documents are generally written so that these powers are only granted while you are incapacitated and unable to act on your own. These are called “springing” powers of attorney, because they spring into action upon your incapacity.

If you are elderly or facing a long-term illness, you may consider gently easing someone you trust into the role of your “agent,” helping you through powers of attorney, over a period of time. This might be a sibling, a spouse, a child, or someone else you truly trust. This person should understand that if you have a stroke or other sudden decline, they will have to jump in with both feet.

If you think you may someday need to go further, and give full control to someone as conservator, you should nominate a person for that job too. This nomination is contained in the durable power of attorney for property (conservator of the estate nomination) and in the advance healthcare directive or durable power of attorney for healthcare (conservator of the person). These nominations may also be available in a separate document—apart from the durable powers of attorney for property or healthcare.

If it came to the need for a conservatorship—if, for example, you became a danger to yourself or others—a court would have to investigate and confirm your nomination. Your nominee would have to go through a criminal background check, a credit check, and more. But you would have had primary input. If you have not made a nomination, state laws indicate a priority of appointment typically based on your family tree and the laws of “intestate succession.”

Regardless of the situation, clear your decision with your designees and nominees while you still can. It’s a heavy responsibility to take on either power of attorney or to become a conservator, and you want to make sure everyone will agree to serve.

Do not surprise a loved one with this responsibility when you are hit by a car. For one thing, they may say no.

If you are the person caring for someone with a mental incapacity, you may at some point have to consider a conservatorship. Sometimes, you simply have no other choice.

I know a woman who is taking care of her husband with dementia. He had always been a loving and gentle husband and father. But the disease is destroying his judgment, and little by little he is becoming violent. Recently, when they were in the drive-through line at a burger place, he just randomly let loose and clocked her. Knocked her out cold.

Now, it is truly her responsibility to go to court and apply for a conservatorship to have him institutionalized against his will. It happens.


In Mistake #9, we learned that living trusts are not generic, cut-and-paste documents. The same is true with power of attorney documents. For starters, you will be asked to grant separate powers for property and for healthcare decisions.

When you grant property power to your agent, you are authorizing this person to make decisions about your property and your finances while you are incapacitated—and to take specific responsibility for paying your bills, maintaining your online accounts, contributing to, managing, or withdrawing from your IRA, and the thousand other financial responsibilities we all face.

You may or may not, however, want this same person making healthcare decisions for you.


You should also understand that even powers of attorney for property may be best divided.

If you own a business, you may want a different person to make business decisions during your incapacity than the person making your personal financial decisions.

You may want a different person making your investment decisions than the person handling your day-to-day finances.

You may also want to grant powers of attorney which are not durable, but end when you lack capacity. This may prevent, for example, a business partner from taking some action while you are out with a stroke.

Nondurable powers may empower a spouse or a business partner to make crucial decisions every time you are on vacation in remote locations, and then disempower them again when you return.

Another important question involves gifting. Most power of attorney documents I have seen do not include gifting authority—in other words, the agent you name during your incapacity generally does not have the right to give away your property to anyone else.

However, the power for one spouse to make a gift of their assets to another may be crucial in public assistance benefit planning, as you will see under “Monetary Fallbacks for Disability,” below.

Work closely with your attorney to discuss these decisions and craft these documents. Consider your choices carefully—they may be the most important choices you ever make.


If you are incapacitated with an illness, even if you are just under sedation for an hour-long operation—who do you trust to have your best interests at heart and make the right calls with doctors? Approve treatments? Argue with hospitals to keep you longer?

If you lose mental capacity due to stroke, dementia, Alzheimer’s, Parkinson’s, or other common conditions, who do you trust to move you from nursing facilities to home and back again?

Every one of us should choose a trusted person, discuss the responsibilities with that person, and update your choice as often as necessary. The power to make medical decisions for us when we cannot do so is called a “durable power of attorney for healthcare,” and is granted through a pretty straightforward document.

The document says simply, “If I cannot make healthcare decisions for myself, then this person or these people can make them for me.” You can name more than one person to serve jointly, or you can name them to serve consecutively. If this person cannot serve, then the power falls to the next, and etc.

Once again, a “power of attorney for healthcare” has nothing to do with the attorney writing the document. You can grant the healthcare power of attorney to anyone.

If you have a primary residence in one state and a vacation home in another, we recommend to our clients that they create a durable power of attorney for healthcare for each state, because a lot of the related laws are state-specific.


A second document works closely with the power of attorney for healthcare decisions.

The Health Insurance Portability and Accountability Act (HIPAA) created significant restrictions on who has access to your healthcare information. Although it boosted privacy, it also created barriers to swift decision-making and intervention by loved ones. If a doctor or hospital divulges your health information to someone without the proper authorization, they face huge fines—as much as $50,000 per violation, in some situations.

As a result, all health professionals and organizations take HIPAA rules very seriously.

The HIPAA authorization you sign gives authority to one or many people to have full access to your health information. As previously discussed in the Introduction, you may want to expand this authorization well beyond the person you have granted your power of attorney for healthcare. For example, you may want a home healthcare worker to be able to call up and check on your prescriptions, even if you don’t want this person to make major medical decisions for you.

Think through your HIPAA authorizations carefully with an expert lawyer. In some cases, for example, you may want to have separate HIPAA authorization documents for different people and circumstances.

Although HIPAA is a federal law, there is no federal HIPAA form. Each state has its own. In my home state of California, for example, a HIPAA authorization must be printed in fourteen-point type to be valid!


A “living will,” sometimes known as an “advance healthcare directive,” tells medical personnel, loved ones, and the person you have given power for healthcare decisions your preferences for medical care in dire circumstances, “in advance.” A living will generally comes into play only when you are in the late stages of a fatal illness, fall into a coma, or have suffered an extremely serious injury.

Please do not confuse “living will” with “living trust.” They are completely unrelated documents, with different purposes.

In most cases, the goal of a living will is to give permission to loved ones to let you pass away in order to avoid unnecessary suffering. Most living wills say, in essence, “If I’m a goner, let me go.”

When my grandmother had a heart attack, my grandfather called the paramedics. It was a massive heart attack. The paramedics rushed over, got out their paddles, and shocked her heart back to life. Then they put her on a ventilator and took her to the hospital. But she never recovered consciousness, and never showed signs of recovering the ability to breathe on her own. The doctors said there was no hope, and indeed, when I looked at her, I could see that her soul had probably already left her body.

My grandmother had created no living will and had never even discussed this possibility, so the decision to terminate life support was made even more difficult for my father and his two older brothers. After a week, my father and his brothers made the agonizing choice to terminate life support. Ten years later, my father still asks me, “Did I do the right thing?”

I tell him that I was very close to my grandmother. And then I say, “Of course, you did.” I say this because there really was no alternative. But the choice would have been much easier if she had made her own desires clear in a living will.

I will not go into all the specific details of a living will, such as how it relates to “Do Not Resuscitate (DNR)” and“Physician Orders for Life-Sustaining Treatment (POLST)” orders. Instead, I refer you to your attorney. Just make sure you get the appropriate legal and medical advice.

We are here to help you navigate all of these documents and create a plan that will help protect you in any situation. Attend one of our FREE seminars for a consultation with a licensed attorney.


Forgive me, but I need to start this chapter with a statement that’s both brutal and true:

A disability is often harder on a family than a death.

Why? Because if you become seriously disabled, your loved ones will have to deal with many of the same legal issues as when you die, but they will also have to take care of you. A serious disability is not just difficult and draining for everyone, but shockingly expensive. A nursing home runs from $3,000 on up to $30,000 or more a month, depending on quality and level of care. In-home help can be nearly as expensive. Both Medicare and health insurance stop paying for institutional daily care after a short time limit. And most government aid programs expect you to exhaust nearly all your assets before they step in to help.

A mental incapacity triggers the most significant consequences of all.

As I write these words, my wife acts as the primary caregiver for her mother, who has Alzheimer’s disease, and can provide little or no care for herself. As Nancy Reagan put it, we are living “the long, long goodbye.” My mother in-law was once a strong woman who raised four boys and a daughter. This makes the emotional burden on my wife that much harder. Their roles have reversed. My wife has become the parent, and the parent has become the child.

Because I have pledged myself to honesty in this book, I will say this aloud: my wife’s mother has become a 102 pound two-year-old. I do not say this to be heartless. I say it to face facts. My wife would like to be with her mother for positive moments. She’d like to take her mother out for fun activities, have what conversations they still can, and enjoy each other’s company. But the cost factors demand that my wife provide daily personal care which leaves little time for positive moments.

From the standpoint of legal and family logistics, mental incapacity can prove more challenging than death. That’s because while death is a clearly defined state, incapacity is not. To quote Yogi Berra, “It ain’t over till it’s over.” From a legal perspective, incapacity creates a twilight zone of uncertainty, which often causes strife within families, drains estates, and leads to unnecessary and debilitating court battles.

In the Introduction, I noted that 80 percent of Americans will face a period of sustained disability before their deaths. Most of those Americans will not have done even the most rudimentary planning for this event. A “last will and testament” does not adequately provide for the succession of an estate; it does nothing to provide for mental incapacity, because it’s not legally effective until death.

Remember that in your decline, someone will have to take action. If your mental agility fades, you may become a threat to yourself or other people. You may become substantially unable to resist fraud, duress, menace from predators, or the undue influence of others. If you become unable to provide for your own food, clothing, hygiene, and shelter, someone else must be given the responsibility for your person. Someone else must decide where you will live and with whom you will associate.


If you enter a period of mental incapacity due to a stroke, dementia, Alzheimer’s, or other causes, there may come a point when you really should not be in control of your bank account or other affairs. At this point, if your family doesn’t step in, the government will.

If someone notices that you have started writing checks for $5,000 to the pizza delivery guy, and no family member with legal authority steps in, the county in which you reside will enter your home and take over. Certain institutions, like banks, hospitals, and senior centers are on the watch for moments like this, and they are required to report their suspicions about your mental capacity to law enforcement.

They are called “mandated reporters.”

Typically, a county social services agency will be asked to take action. And often, social services will call in a special law enforcement unit called Adult Protective Services. The actions of Adult Protective Services are not public. You cannot get access to their reports, and you cannot find out what all these people have been saying about you—so unlike a criminal, you cannot “confront your accuser.”

At that crucial moment, if you have created the proper documents to give someone a “durable power of attorney for property” in case of your incapacity, along with a “durable power of attorney for healthcare,” or an “advanced healthcare directive,” someone you have previously designated can step in and take control from the county. Importantly, this agent working on your behalf can prevent action by a court to create a “conservatorship” for you. As we will see, a conservatorship represents a serious loss of rights.

Of course, your incapacity may happen much faster, and be more serious than writing questionable checks.


Let’s say Jack, who has been widowed for many years, has a major stroke at age seventy-four. Now he’s lying unconscious in a Chicago hospital. He was on the golf course and just collapsed. The doctors say that Jack may or may not recover from his stroke. In any case, he will definitely need daily physical care for years and will not be able to handle his own affairs.

Jack has two children, Charles and Mary, who live on opposite sides of the country. He also has a sister in Chicago, named Eleanor. She’s seventy. All these folks have always gotten along, but over the years, they’ve kind of fallen out of touch.

Jack owns a house with some equity, but everyone figures he’s still making mortgage and insurance payments. He has multiple bank accounts and investments, but no one’s quite sure where they are. His valuable sports car still sits on the lot at the golf course. That’s about as much as anyone knows. After all, Jack was only seventy-four, and until today, he was competently handling all of his own affairs.

Now Charles and Mary, who are both in their late forties, with careers and kids, have flown in to stand at Jack’s bedside. Eleanor and her husband have shown up too. Charles has already been over to the house, and he found that Jack did make a simple will using an online service in which he divided everything nicely between Charles and Mary, with Mary as executor. But Jack never created the essential documents you will learn about later in this chapter. He never created a living trust. And he never designated powers of attorney for property or healthcare decisions.

Plus, well, he’s still alive. So, now what?

If Jack had died, Mary would have taken over as executor, and after the funeral, she would have gone to probate court to get the will certified. She’d have struggled through the painful process we described for Bob Jr. in Mistake#10, but she would have figured out how to sell the house, settle Jack’s debts, and divide what remained between herself and Charles.

Now, however, all has become uncertain. Of the people standing next to the hospital bed, who will take control of the situation? And what about those not standing next to the bed, who may want to become involved? Many decisions will need to be made, and quickly.

The hospital (about $10,000 per day minimum and paid by Medicare) plans to discharge Jack to a rehabilitation center ($800 per day and paid by Medicare) that same afternoon. After that, Medicare may pay part of his care up to one hundred days per calendar year. Or maybe not. It depends.

However, if Jack stops physical therapy, occupational therapy, or “plateaus” while in rehab, Medicare stops paying. Then, because he has no long-term care insurance, he’s on his own. He’s looking at $3,000 to $30,000 or more per month depending on where Jack lives and the level of care required. Jack, or his family, will pay for this care out of pocket.

Since he’s not able to make his own decisions anymore, Jack’s on someone else’s watch. But whose?

Jack’s sister, Eleanor, steps up to say she knows about a really excellent care facility not far from Jack’s home. It costs only about $4,500 a month, and a friend said Jack would love it. Eleanor also takes that moment to mention that Jack still owes her $20,000, which she says he borrowed from her five years ago. She tearfully recalls how she and Jack made a childhood pact to take care of each other if anything happened. Her husband puts his arm around her in support.

Jack’s daughter, Mary, points out that she was the one named as executor in the will, so no doubt her father would like her to take responsibility now. Mary believes that the disabled are best cared for by those who love them. She thinks that any facility which only charges $4,500 a month in the Chicago area probably provides substandard care. She’s willing to have Jack flown to her home in Boston, and she will take over his care with the help of some visiting staff. Of course, even the trip would cost a considerable amount of money. She thinks she’ll also need about $35,000 from Jack’s estate to expand her guest room and add a bathroom he can use while in her care.

Her brother, Charles, gets a little annoyed with both of them. After all, his father may recover any day. Can’t they just wait until the one-hundred days (or less) are up in skilled nursing to make any decisions? And anyway, all these options are expensive. Can Jack’s estate even pay for it? How can they know? Will the house have to get sold? What if he wakes up and his house is gone? Also, right now, the hospital wants someone to sign off on the discharge plan. And by the way, the golf course would like to see the car removed from its parking lot.

Charles would love to help, but he has a job in Los Angeles he needs to get back to right away.

The next day, both Mary and Eleanor call some banks and are surprised to discover that neither of them has the right to access Jack’s accounts without going through an emergency court process. As the arguments escalate, it becomes likely that both Mary and Eleanor will petition the court to become Jack’s conservator (more about the meaning of that term in a moment) and get access to his accounts.

Soon, all three of Jack’s closest family members grow to dislike each other. Mary gets mad at Charles for being unhelpful, and she starts thinking she deserves more than 50 percent of that will. In probate court, Eleanor again mentions getting reimbursed for her undocumented $20,000 loan.

But there’s more.

As Jack’s financial records come to light, they will become a matter of public record, along with all his debts. All the other relatives within a second degree of kinship will have to be notified—including the children of both Charles and Mary, some of whom are old enough to care what happens to grandpa and his money.

Both Eleanor and Mary have petitioned to have themselves appointed as conservators, but neither understands quite what she is asking for. Whoever becomes conservator will shoulder a considerable burden, and thanks to the ill will created during a court proceeding, she may be under continuous scrutiny from the others. She will have to provide an accounting to the court, down to the penny, every two years. This will include submitting a ledger with everything in and everything out; the growth or decline of investments. The works.

Meanwhile, Jack’s care will begin eating up his estate.

Whoever takes charge will have to make tough decisions, possibly resented by the others, about selling or renting the house and liquidating investments. The legal process itself will likely consume thousands, if not hundreds of thousands of dollars—depending on the value of the assets and the length of the fight. The same attorneys who practice probate law practice conservatorship (or guardianship) law, and they do not come cheap.

In the event that none of the three closest relatives applies to be conservator (or is approved by the court), then the county judge will appoint a “neutral” party—either a private professional fiduciary or the “public guardian” to take control. The public guardian’s office is typically a county agency that looks out for the indigent. As it happens, the “indigent” sometimes have money but are poor in family. Or poor in family that cares.

For more information on how you can create an Estate Plan that will protect you and your family in any situation, contact our team today.