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San Antonio Express-News
July 12, 2002

Long-Distance Financial Management for Ailing Parent

© 1989-2004, Paul Premack

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Dear Mr. Premack: I live in Texas but my Mom lives in N.C. She is beginning to have difficulty handling her financial affairs, neglecting to pay her bills, losing checks, and even forgetting that she moved a large amount of money to another bank. I had thought a trust administered by her bank would be good, but she is not happy with this. Currently, I am joint owner on all her accounts and have a durable power of attorney, but I have found from talking with these varying banks, savings and loans, and credit unions that their rules differ. I don't want to simply change everything over to my name only, because I don’t want to incur the tax nor hamper Mom's ability to write small checks. What can I do long distance to safeguard her from herself? -- S.C.

The fact that your mother has already created a durable power of attorney and has already listed your name as cotenant on her account is immensely helpful. This gives you the legal authority that you need to put together an action plan and to implement it.

The idea you suggested to your mother, using a trust, is actually a very good one. She is hesitant to give up management rights by letting the bank’s trust department make all her decisions (which is very understandable). Look into this alternative: get a N.C. attorney to create a revocable trust for her assets. In it, she can name you as Trustee (so that you have management rights, but do not have tax problems). The trust should specify that all its resources are dedicated to her care.

After she signs the trust, work with your mother to change all her accounts out of her name, individually, and into the name of the Trustee of the trust. The banks will be happy to set up the accounts that way, and you will be rid of the hassle of dealing with each institution’s differing policy on durable powers of attorney.

At the same time, leave one checking account outside the trust (so that it is still in your mother’s name and your name, individually). That is the checkbook she’ll take to the grocery store, and you can transfer money into as needed from the trust (but in small enough amounts to minimize the risks).

When you select the bank, be sure they offer some type of Internet banking arrangement. Some banks have signed-on with the two major retail accounting software packages, Quicken™ and Microsoft Money™. These programs can get pretty complex, and some banks opt to use their own systems that work directly over the Internet.

Either way, you will then be able to monitor your mother’s spending on a daily basis. Using your home computer, you can balance her accounts, verify that her bills are being paid – even pay her bills directly from her accounts. You can transfer money, monitor her spending, and generally keep an eye on her finances even though you are in Texas and she remains in North Carolina.

Prior column: Executor's Fees
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Guardianship: Options & Process
Disclaimer: This column answers a specific legal question offered by an individual in the South Texas area. The answer may or may not match your individual situation. Be careful not to treat this column as specific legal advice that meets your individual needs. It may give you a solid basis for discussion with your own attorney. Also, please be aware that laws change. You should consult with your personal attorney before you take any action on this or any legal issue.

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