When preparing estate plans, many individuals focus on what will happen after they pass away. However, it is often just as important to consider what will happen if one becomes incapacitated.
In the event that you are no longer able to make decisions for yourself, it’s important that your estate plan include arrangements to protect you – and prevent financial abuse.
What is elder financial abuse?
Elder financial abuse can involve scams and fraud aimed to take advantage of elderly people. Perpetrators may contact elderly people by phone or email and trick them into releasing their personal financial information.
However, elder financial abuse is most often committed by someone an elderly person knows – and even trusts. This may be a family member, caregiver or neighbor. This individual may take advantage of an elderly person with cognitive impairment – finding a way to gain access to their accounts and misuse their funds. The abuse may start with small misappropriations of funds and then slowly become more egregious. The earlier an issue is caught and dealt with, the less damage can be done.
Taking preventative action
You may have already set up a will or trust to plan for how your assets will be handled once you’re gone. But it is equally important that your estate plan include contingency plans – in the event that you are no longer able to make decisions for yourself. This includes designating a trusted power of attorney for both your property and your personal care.
Individuals who do not make plans in advance for their potential loss of capacity may find themselves at higher risk of abuse, especially if they end up with dementia or other cognitive issues.
Financial abuse is a very common issue in Canada. In fact, the Ontario Human Rights Commission reports that 62.5% of abuse cases involve financial exploitation. In addition, with the number of Canadians aged 85 and older growing at nearly four times the rate of the rest of the population (19.4% and 5% respectively), the number of financial abuse cases is expected to increase.
No one wants to anticipate a day when the are no longer able to make decisions for themselves. However, taking steps now to protect your future – no matter what it holds – is wise. An estate planning lawyer can help you with advance planning to ensure a trustworthy person is left in charge, should a loss of capacity occur.