By:  Stephen R. Elville, J.D., LL.M. – Principal

Many of us remember the Hawaii ballistic missile red alert that was issued in January of 2018, the one that fortunately turned out to be a false alarm. How could such a thing happen? How could a drill go so wrong and cause so much damage? Estate planners, CPAs, and financial advisors are asking themselves similar questions right now about the proposed SECURE Act, except that this may not be a drill – it may be the real thing. The SECURE Act may impact your estate planning in a significant way – in particular, estate planning for retirement plan assets. The SECURE Act (House of Representatives’ version – the 10-year plan) recently passed through the House by way of a 417-3 vote. The Senate is proposing a 5-year plan. Although it is unclear which plan will go forward, it is anticipated that one of the two plans will pass in both the House and the Senate and be signed into law by President Trump soon. If this comes to pass, the new law would go into effect for decedents dying after December 31, 2019 (effective in 2020).

Why is the SECURE Act important and what should you do? The SECURE Act will directly impact the length of time IRAs and Qualified Plans can defer income tax and be stretched. Unlike the current law allowing inherited IRAs to be stretched out in accordance with IRS life expectancy rules, the SECURE Act would limit the stretch out of IRAs to either 5 or 10 years, with some exceptions (including spouses, persons with disabilities, and chronically ill persons). And yes, the Act also applies to Roth IRAs. Before I go any further, let me say right here – there is no doubt the SECURE Act is POTENTIALLY TERRIBLE FOR CLIENTS, and many of our clients are already very upset at the prospect of their estate planning being disrupted, along with lifelong plans to leave children, grandchildren, nieces and nephews, or others retirement plan assets over individual life expectancies thwarted. Nonetheless, all we can do is prepare for the coming changes and get ahead of the income tax planning implications. Along these lines, if the SECURE Act becomes law in its current proposed form, you will need to be aware of the following:

(1) Conduit trusts will no longer be a long-term viable asset protection planning tool – with all distributions being forced out to the beneficiary in 5 or 10 years, this technique will be relegated to the shallow end of the pool;

(2) Accumulation trusts will likely become a tool of choice – however, state law is crucial to success and how much income must be distributed out;

(3) Roth conversions will become a main strategy for dealing with the new law;

(4) Charitable remainder trusts and direct charitable gifts will be utilized as powerful strategies for attaining stretch out for certain clients who are charitably inclined;

(5) Traditional notions such as the deceased spouse leaving 100% of their IRA or Qualified Plan to their surviving spouse may change – for example, it may be advantageous for the surviving spouse to disclaim a certain portion to children, while retaining the balance;

(6) Migrating IRA funds into life insurance will become an even more powerful alternative strategy; and

(7) Some clients may utilize the laws of certain states with no state income tax to gain an advantage.

I hope this brief but critical information about the proposed SECURE Act is helpful to you. I will be discussing the impact of this potential legislation with clients, helping to make sense of the changes that are likely to come, and advising about any needed planning adjustments. If you would like to speak with a member of our estate planning team about this unprecedented situation, please contact Mary Guay Kramer at mary@elvilleassociates. com or Lainey Olson at lainey@elvilleassociates.com. Otherwise, we will be sending out further communications about the SECURE Act as things develop.

Tags: The Secure Act
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If you are a part of the millennial generation or younger, there is a steady path you can pick that can over time make you a self-made millionaire. It does not require a unique set of skills, specialized knowledge, or even excessive risks. Americans who achieve millionaire and multi-millionaire status using this technique took an average of about 32 years to accumulate multi-million dollar wealth with some achieving it in as early as 18 years. They are called saver-investors, and when you encounter one, at first glance, they might not seem that rich.

Saver-investors typically are ordinary people without any particular advantages in life. They did not come from a wealthy family. Nor did they have unique or advanced skill sets that brought in high salary income. Primarily, investor-savers did not attend elite universities, get advanced degrees, inherit money or own high-end cars, clothes or homes. What saver-investors do have is the disciplined ability to follow two simple rules. The first rule is you must save 20 percent or more of your income and have the discipline to live off of the other 80 percent. The second rule is you must consistently and prudently invest your savings. Prudent investing means doing your homework for each investment vehicle and then continuously monitoring its progress. Typically, a saver-investor puts their money in retirement plans like a 401(k), equities, and real estate and then let valuations grow.

If the key to building wealth is so simple, then why isn’t everyone rich? Quite simply, it comes down to habits, the financial habits of people. It requires enormous fiscal discipline and a long-term commitment to become a saver-investor. It can require sacrifices, like running a side business or working a second job. John Jacob Astor famously said, “Wealth is largely the result of habit.” Long-term wealth creation is built on the foundation of consistent application of sound financial habits.

One habit is to eliminate distractions by learning how to say no often. If something is not aligning with your goals and dreams and will keep you from moving forward, it is a distraction and should be eliminated. When you do say yes, say it infrequently. Say yes to the things that are directly tied to your goals and dreams. Every day you need to learn something new. Grow your financial literacy and develop new skills. Use this new knowledge or expertise often to maintain and perfect your skills. Save money because it gives your options, empowers you, and gives you freedom. Opportunities are only as good as the financial resources you have to take advantage of them. Surround yourself with other like-minded individuals because social circles influence our feelings, thoughts, and behaviors. Calendar your day by the hours or even half hours to be highly effective. Isolate blocks of time in pursuit of those things that will help you build a foundation for success through financial independence. Finally, develop patience. Acquiring wealth as a saver-investor takes time. When things get tight in day to day life, remember to survive until you thrive. It isn’t good luck that is going to make you wealthy; it is the persistence of good financial habits that will.

Part of living off 80% of your income includes choosing to live a modest life. Warren Buffett famously still lives in his first home purchased in 1958. Drive an ordinary car and wear simple clothes and jewelry. If you have children, send them to public schools. If they need more or better education, then supplement their learning by teaching them or signing them up for free online courses. There has never been a better time for humans to become knowledgeable about how to gain wealth. The internet has put a wealth of information in the palm of our hands. If you genuinely want to be wealthy, then develop good habits, live beneath your means, and employ the saver-investor method.

The next step is to plan to protect your wealth. Give us a call to discuss your planning options or options for if you’re planning for a loved one. You can reach any of our six locations in Maryland by clicking here to send us a message or by calling us at (443) 393-7696.

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When a loved one enters hospice care, the whole point is to provide peace of mind and comfort to the patient and the family. And yet a lack of regulation, oversight, and available information means that isn’t always the case.

The HSS Inspector General has found that, between 2012 and 2016, health inspectors cited 87% of hospices for deficiencies. In 20% of hospices, these deficiencies were serious – serious enough to endanger patients. For-profit hospice agencies are more likely than to have non-profits, likely because decreasing staff increases profit margins.

There aren’t many options for the Centers for Medicare and Medicaid Services (CMS) to discipline hospices. They can drop hospices from the Medicare program, but they can’t assess fines or install temporary management. Many complaints can’t be substantiated, and even when they are, that information doesn’t become readily available to consumers. CMS could put citations for deficiencies and complaints on their website for consumers, Hospice Compare, but they don’t.

The CMS Inspector General has recommended that legislators strengthen hospice standards, increase inspections, streamline the complaint and investigation process, and improve accountability and availability of information. Whether we will see improvements in the near future remains to be seen.

Choosing long term care for a loved one can be challenging. We help families find good long term care and work with them on how to pay for the care. If you would like to talk about your needs, please don’t hesitate to reach out.

You can get in touch with any of our five Maryland offices by clicking here to send us a message or by dialing (443) 393-7696.

Read more at:

• https://www.npr.org/sections/health-shots/2019/07/09/739471717/hospice-oig-reports
• https://www.latimes.com/local/california/la-me-lopez-hospice-complaint-20190216-story.html
• https://www.latimes.com/california/story/2019-08-09/hospice-mother-california-complaint

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By:  Jeffrey D. Stauffer – Community Relations Director

As one of only fifty (50) Client Care Programs in the United States accredited by the Client Care Academy in Boston, Elville and Associates’ Client Care Program (CCP) mission is to provide Members with the comfort and assurance that their estate and elder law plans will stay updated over the passage of time and that clients and their families receive the education they need. The attorneys and staff at the Firm work diligently to deliver Member services that stand out for their excellence and integrity, and most importantly, that elevate how families are cared for. As the CCP recently surpassed its three-year anniversary, Member benefits continue to grow in scope and depth. As a Member organization, you will want to be sure to take advantage of all the benefits to which you are entitled through the CCP. These benefits include:

Access to Attorneys and Staff

The members of our team will be reasonably available to answer your questions, either by telephone or email, whenever and as often as you would like, including in-person meetings as needed.

Client Education Services

The CCP will provide regular educational workshops for our client Members, their families, successor trustees (and other fiduciaries), and planning team. The topics of these workshops vary and have recently included changes to the trust and estate tax laws, what successor trustees should do if you become disabled and when you die, how to maximize your Social Security benefits, estate and trust administration, and much more. Each fall we will also invite you to our annual Client Education Event.

Document Updates

Our attorneys will review your estate planning documents whenever you reasonably request, and at least every two years, and we will update your planning as the laws change, when your personal situation or goals change, and as the nature and value of your assets change. This will ensure that your estate plan will always be up-to-date.

Asset Review, Tracking and Updating

We will provide regular reviews of your estate plan asset funding and alignment, and will also provide regular funding and alignment updating to ensure that your trust or will-based plan is fully aligned and will work as it was intended.

MIDEO® Consultation and Card (**NEW**)

In the first-of-its-kind partnership in the country, Elville and Associates and The Institute on Healthcare Directives have partnered to offer MIDEO® (My Informed Decisions on VidEO) to our members. MIDEO® is a personalized card with your critical healthcare information on the front that also hosts by video, accessible by a QR code scan, your prerecorded wishes for resuscitation and other healthcare choices. By providing an accurate, up-to-date, easy to review video of you speaking, your personal MIDEO® card will accurately allow your wishes and choices to be carried out correctly by medical professionals. For more information about MIDEO® and The Institute on Healthcare Directives, please contact Community Relations Director Jeff Stauffer, visit www.institutehcd.com or contact Ms. Brandi Monroe at the Institute at monroe@institutehcd.com.

Family Heritage Video

Members are encouraged to participate in their own archival family video production at the Elville Creative Studio in Annapolis. Family members may express themselves and share whatever they want for future generations to remember — their wishes for family, values important to them, old stories they want to pass down for generations to come, and much more. There are no limits and the creative possibilities are endless.

Family – Advisor Meeting

Within sixty (60) days after your estate plan is completed (or as soon thereafter as you can arrange for all of your family to participate), we will provide you the opportunity to have a family meeting, to include members of Elville and Associates, your family members, and your financial and professional advisors (those persons who will implement your plan) so we can answer any of their questions, explain how your planning works, and explain how to settle your estate plan upon your passing. The importance of the Family-Advisor meeting cannot be understated.

Coordination with Advisors

Our staff will be available to consult with your financial advisors, accountants, insurance professional, and geriatric care managers. If you do not currently have one of these all-important advisors available to you, we will work in partnership with you to find an appropriate professional relationship that fits your family’s needs. Our staff will also provide copies of your documents should you so request.

Additional Participation Benefits – DocuBank and Everplans

We will provide free notary public services as and when needed and will provide copies of your estate planning documents to your advisors and others upon your request. You will be enrolled in a health care document retrieval service called DocuBank which provides 24-7 access to your medical records and other documents. You will also have the option of enrolling in Everplans, a state-of-the-art, secure digital archive for all of your essential information (everything your loved ones will need should something happen to you).

Elville and Associates’ first CCP Continuing Legal Education Event of the year, “Navigating Longevity,” was held on Saturday, March 16th on the Arnold campus of Anne Arundel Community College. Led by one of the region’s most soughtafter speakers, Ms. Ellen Platt, MEd, Certified Rehabilitation Counselor and Certified Geriatric/Life Care Manager with The Option Group, members and their families were taken on a journey through geriatric care management; cognition, brain health, and dementia; care options; and taking care of the caregiver.

Summertime means fun in the sun, trips to the beach, cookouts, and the CCP’s annual Social Event! On Sunday, July 21st, members and their families enjoyed an evening showing of the smash-hit musical, “Grease,” at Toby’s Dinner Theatre in Columbia. After a dinner buffet was served before the sold-out show, guests were taken back to the 1950s with Danny, Sandy, the T-Birds and Pink Ladies! A stellar cast brought the timeless classic to life as they acted and belted out “You’re the One That I Want,” “Summer Nights,” Hopelessly Devoted to You,” “Greased Lightnin’” and more to the delight of the audience.

Elville and Associates’ is pleased to announce its 7th annual Client Event will be held on Saturday, October 12th, 2019 from 8:30 to noon at the Retreat and Conference Center at Bon Secours in Marriottsville. This year’s theme is “What Families Need to Know about Planning for Loved Ones with Disabilities.” Along with a superb lineup of presenters, delicious food, door prizes, gift baskets and concert ticket giveaways will highlight the morning, and entertainment will once again be provided by the Max Vanderbeek Jazz Group – a professional jazz trio led by one of the Elville Center for the Creative Arts’ finest school partners and music directors, Dr. Maximus VanDerbeek of Wiley H. Bates Middle School in Annapolis. Presentations will include “Financial Planning for Special Needs,” “The State of Special Needs Planning Today,” “An Overview of Waiver Programs,” “Special Needs Planning and the Augmented Estate,” and a “General Legislative Update.” Invitations will be forthcoming in mid-September, and we kindly ask that all RSVPs are finalized by October 4th. Seating is limited and the event will “sell out,” so contact our office to reserve your seat soon!

To learn more about the CCP, its many benefits and how to become a member, please contact Mary Guay Kramer, Client Care Program Coordinator, at 443-741-3635 or mary@elvilleassociates.com.

Tags: Client Care Program
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By:  James M. Dore, J.D.

Consider the following scenario – a couple got married and had two children, a son and a daughter. After many years of marriage and raising the children into adulthood, the wife took ill and passed away. In the year following his wife’s death, the husband executed a Last Will and Testament that named his two adult children as legatees, and designated the daughter as primary Personal Representative (PR) of his estate and the son as the alternate PR. Several years later, the husband remarried. This second marriage lasted over ten years and was by all accounts a happy one. Although the husband allegedly made statements to several individuals about his desire and need to update his estate plan to provide for his new spouse, he never took formal action to do so. After the passage of more time the husband ultimately died, leaving his widow to deal with an outdated estate plan.

Several weeks after her husband’s funeral the widow received a letter from the husband’s daughter, who was acting in her capacity as PR of the husband’s estate. In her letter the PR alleged that because the widow was not named in her late husband’s Will, she was not entitled to inherit from her husband’s estate. The PR enclosed a check payable to the widow in the amount of $10,000.00—purportedly given the widow as some sort of consolation– along with a “Waiver and Assignment” by which the PR asked the widow to waive her right to the estate and assign the entirety of her interest thereto to the son and daughter.

Although the relationship between the widow and her husband’s children was cordial, it was not close. Further, the widow was not a native English speaker and, despite being fluent in two other languages, her English was not strong. Unsure of her rights and not wanting to make waves, the widow signed the Waiver and Assignment and returned it to the PR. She did not deposit or cash the check.

The widow was left unsettled by the situation and, questioning whether she did the right thing, sought the advice of friends a few days after returning the signed Waiver and Assignment to the PR. Upon learning of the widow’s predicament, her friends wisely urged her to seek counsel experienced in probate law and estate litigation.

The widow’s counsel immediately took action to revoke the Waiver and Assignment, and to claim the widow’s Elective Share of her late husband’s estate pursuant to Section 3-203 of the Estates & Trusts Article of the Annotated Code of Maryland.

The foregoing case study presents another example of why proper estate planning is important, especially when important changes such as subsequent marriages occur. If you would like to learn more about estate planning or if you have questions or concerns regarding your current estate plan in anticipation of important life changes that may be forthcoming, please call us at Elville and Associates. We are ready to assist you.

Tags: Elective Share, J.D., James M. Dore
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The traditional senior housing market is undergoing a profound change. In 2018 senior housing occupancy fell to an eight-year low, even as the senior population continues to increase, as competition for the younger baby boomer market is ramping up and forcing a change to more traditional independent and assisted living options. Active adult concepts like Margaritaville are addressing this market segment that is turned off by the idea of “senior living.” Atria Senior Living is in a joint venture with Related Companies to build $3 billion in senior luxury housing in major metro areas while overall multifamily development with an intergenerational mix of renters is also fragmenting the traditional senior housing market. Occupancy challenges in traditional independent living and assisted living communities are also finding the retention of a reliable workforce to be a continuing challenge. The truth is that the advent of smart home technology and on-demand services ordered via a smartphone, as well as home care aides, are enabling apartments and single dwelling living for more extended periods than ever before. Younger seniors tend to want to age in place for as long as possible.

In the skilled nursing arena, Medicare fee-for-service payment reform brings forward three major provisions: the change to the case-mix classification system, the skilled nursing facility Value Based-Purchase Program, and the skilled nursing facility Quality Reporting Program. The case-mix model focuses on the patient’s condition and resulting care needs rather than the number of care services provided to determine Medicare payment. The Value Based-Purchase Program shifts Medicare payments from volume to value-driven. Finally, the skilled nursing facility Quality Reporting Program is designed, through innovation, to provide meaningful, quality measure reporting, a reduction of paperwork, and a lowering of administrative costs.

These and other changes in Medicare are helping to create an influx of capital into the senior care market incentivizing innovative partnerships and cross-continuum service development. Investors and providers will be partnering with Medicare Advantage payors, retail giants, home health, pharmacies, technology, and other provider groups to reinvent and manage the quality and cost of senior care housing, products, and services. This influx of investment capital combined with technology is destined to create fresh ways to approach senior living needs and the services that provide for them. Web-based platforms and data analytics software continues to address the battle for the retention of the health care workforce while Telehealth solutions are enabling elders in rural markets to reach providers and connect with specialists. Voice recognition software is increasingly being integrated into resident units whether they are private homes or pay for service facilities. Partnering opportunities and joint ventures will continue to create new service models that will, in particular, meet the needs of home and community-based services.

When aging in place is no longer a viable strategy a senior is faced with where to go next. Marketing senior housing to the younger baby boomers is changing, and it is data-driven. In particular, the adult Gen X children of these seniors are helping their parents to make informed decisions, and they typically get their information from online sources. Social media has become a tech tool replacing older marketing models of senior housing communities. Operators can tell their stories, address negative reviews, promote positive news items, and create conversations. Gen X adult children will be looking at social media platforms to get real and varied opinions to validate their parents’ choices.

As Medicare Advantage increases its integration in the overall health care system, data collection and its conclusions are more critical than ever. Potential residents will also be addressing concerns about health care data. More data is being gathered than ever before by Centers for Medicaid and Medicare Services (CMS) on hospital readmission rates, the prevalence of falls, and other related health information and consumers will demand to know what these statistics are before entering into a contract with a senior living community.

Seniors are being presented with more living options than ever before and the competition for their dollars will keep providers in the senior living industry highly focused and fiercely competitive. Questions facing seniors include: How and where do you want to live as you age? Are you well informed about the changing options available to you? Do you have a plan in place that is legally documented for the stages of your senior life? We can help. Give us a call and let’s start planning together.

Get in contact with Elville and Associates at any one of our five Maryland locations by sending us a message here or by calling us at (443) 393-7696.

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By:  Lindsay V.R. Moss, J.D. – Partner

New rules regarding eligibility for VA pension (Aid & Attendance) were implemented by the Department of Veterans Affairs (VA) on October 18, 2018. The new rules are quite comprehensive, but they can also provide more opportunities to qualify for these important benefits. The major changes are outlined below.

1. Look-back and penalty period. There is now a look-back period of 36 months when applying for needs-based VA Aid & Attendance. Any asset that was transferred for less than fair market value during the 36-month period immediately preceding the pension application will result in a penalty period, not to exceed five years.
2. Exceptions. There are a few exceptions to the new transfer penalty rule:
3. No penalty will be assessed if the transfer was to a trust established for a child who was incapable of self-support prior to age 18.
4. There is no transfer penalty imposed if the claimant’s net worth would have been below the net worth limit already (see figures below), regardless of the transfer.

• A claimant will not be subject to a penalty period if the transfer was the result of fraud, misrepresentation, or unfair business practices related to the sale of financial products.

1. Only transfers that occur on or after October 18, 2018, will be subject to the lookback and transfer penalty rules.
2. Annuities may be penalized. If the annuity can be liquidated, then it is counted as an asset. If the annuity cannot be liquidated, then distributions from the annuity are considered income. If the annuity was purchased during the look-back period, then a penalty will be imposed.
3. Calculating the penalty period. The divisor used to calculate the penalty is the Maximum Annual Pension Rate in effect as of the pension application date, at the rate of the aid and attendance level for a Veteran with one dependent. In 2019 this figure is $2,230, and is applicable to all claimants, regardless of marital status. The penalty period will be recalculated if all or part of the gifted money is returned.
4. Net worth. Now there is a bright-line rule regarding the net worth of a Veteran. For 2019, this figure is $126,420.00, which is also the maximum Community Spouse Resource Allowance (CSRA) amount allowed by Medicaid. This number will increase annually with the cost of living increase issued by the Social Security Administration. If the Veteran or other claimant has a net worth over the threshold and therefore does not qualify for benefits, he or she can spend-down assets by purchasing goods or services for fair market value for any household relative.
5. A home/residence owned by the Veteran is not included in the net worth calculation.   However, there is a two-acre limit imposed on the home/residence. If the claimant’s home/residence is over two acres, then other rules apply and the value of the property in excess of two acres may potentially be included in the net worth calculation.
6. The value of “personal effects suitable to and consistent with a reasonable mode of life” is not included in the asset calculation. This would include personal transportation vehicles and most household goods.
7. The annual income of the claimant and certain dependents is included in the calculation of net worth. However, reasonable and predictable unreimbursed medical expenses can be deducted from income.
8. More medical expense deductions. The new rules provided an additional Activity of Daily Living (ADL) to include assistance with ambulating within the home. The rules also define Instrumental Activities of Daily Living (IADLs) and set out specific instances when expenses for care that include ADLs and IADLs may be deducted from income. The rules also specific when room and board at a care facility other than a nursing home may be deducted from income as a medical expense.

Please contact Elville and Associates if you have questions about these new rules, or if you would like to discuss whether you or your loved one might qualify for VA pension benefits.

Tags: Lindsay V.R. Moss, VA Aid
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The increasing number of seniors and near-seniors experiencing dementia in the United States is on a rapid rise. A hallmark of cognitive decline is a long pre-clinical phase followed by an actual medical diagnosis that progresses from early to middle and late-stage dementia. Poor memory, agitation, confusion, and understandable fear of the future are some of the first characteristics a senior may experience as cognitive decline takes hold. It is a frightening diagnosis for anyone’s future well-being.

When symptoms begin to show there are some relatively simple technologies available that will enhance the senior’s at home safety and provide a level of comfort as they begin their first steps in what can multi-year journey of dementia. These technology tools can reduce feelings of overwhelm for caregivers and their loved ones who are living with the disease. While some of the devices may seem quite simple to those without problems of cognition they can improve the quality of life for all involved.

People living with dementia often confuse day and night and can become distraught as they argue with a caregiver about time. A specially designed clock for those with dementia can alleviate the confusion and allow a caregiver to maintain routine behaviors. Some of these clocks do not give the actual time but rather a simple display design identifying morning, afternoon, evening, and night. Other clocks will display the date, time of day and day of the week in on either a 12 or 24-hour display which can be particularly helpful to a veteran who lived their life on military time. The clock also has a multilingual feature and can be set in 8 different languages.

Google has a screensaver clock app that is visible at all times displaying the day of the week and morning, afternoon and night. Many clock app designs allow for thousands of options allowing intensive customization. Finally, combination clocks with large magnifying aids and numbers offer both digital and analog, the day of the week, and more – all in oversized text.

Adaptive phones and video chat devices that are preprogrammed with frequently dialed numbers on large buttons or with picture identification allows a dementia patient ease of use in staying connected to loved ones. Staying in touch with friends and family is essential to the well-being of seniors experiencing cognitive decline. Often, a person living with dementia will forget what a person said or did, but they seem to be able to remember how it made them feel. The senior might hang up the phone after a FaceTime or Skype and not remember who they just spoke to but still feel better for it.

If the senior lives alone, electrical appliance use monitoring can alert a caregiver if an appliance has not turned on or off. This tool plugs into a power strip or wall outlet and can provide additional safety for the senior at home alone in the event a stove was left on, as well as let a caregiver know if the senior is remembering to eat or cook for themselves by monitoring the kitchen appliances.

People with dementia could wander and even become lost. Wearable GPS location and tracking devices have many options that can alert a caregiver what room in the home a loved one is occupying. If they walk outside to retrieve their mail and forget to come back in a caregiver can be alerted remotely and perform a location and wellness check. If the senior does not get out of bed and move to the kitchen for breakfast or a recliner to watch television a caregiver will be alerted. Anything that is outside of the expected routine of the senior with dementia can become an alert to a caregiver.

Companion care robots have several positive benefits in the homes of people with dementia. Robots can decrease rates of neglect or abuse by assisting an overwhelmed human caregiver. When a caregiver’s workload is reduced through the use of robots, they have more time to focus on human interaction, typically with a better attitude. Caregivers can then become better listeners and observers as well as have time to identify and address key patient issues. In the absence of a human caregiver a chatbot, similar to a smart home assistant, can bring conversation, daily reminders, read or play games and answer questions for a person living with dementia. Companion care robots are a new standard of caregiving because of the multitude of tasks it can perform and alerts it can provide.

Smart home environmental controls can adjust thermostats and turn lights on and off providing a safer and more comfortable living space. They are also capable of sending alerts via smartphones in the event of an unforeseen event or change in patterned patient behavior. Smart homes coupled with in-home cameras are a great way to ensure the safety of a person with dementia. Cameras that allow two-way conversation as well as provide a visual projection of medication sites, relaxation areas and more allow a remote caregiver to monitor their loved one’s movement. Alerts are sent if no motion has been detected for a set time.

Medication management and reminder messages provide additional support for a person living with dementia at home. Whether a high-tech pill dispenser or pillbox marked with days of the week, a vibrating alarm on a watch or scheduled audible reminder from a smart assistant or chatbot can help keep a patient taking the correct dosage of medication at the proper time. Medication management through technology tools helps avoid a potentially catastrophic situation of incorrect or no dosage.

These technology tools are useful to all seniors living at home but especially to those suffering cognitive decline. Establishing repeatable, patterned behavior through these tools creates a structure that alleviates some of the more frustrating aspects of losing memory. Caregivers can focus on the more human-oriented tasks and loved ones from far away can maintain a connection as well as monitor the well-being of their family member. As a family, and even in the absence of a dementia diagnosis, setting these tech tools in place is a smart idea for a senior living at home alone.

We hope you have found this information useful. If you have questions or would like to discuss your particular situation, please don’t hesitate to reach out to any of our five Maryland locations by clicking here to send us a message or calling us at (443) 393-7696.

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By:  Stephen R. Elville, J.D., LL.M. – Principal

Everything has a purpose or premise. Every second of our life has its own premise, whether or not we are conscious of it at the time. That premise may be as simple as breathing or as complex as a vital emotional decision, but it is always there. – Lajos Egri

This year it was my privilege to be asked to write the annual Heckerling Highlights article for the Estates and Trusts Section of the Maryland State Bar Association. After I readily accepted and took off on the project like a teenager who has just been given a new 2019 Ferrari 812 Superfast (789 horsepower by the way), I soon discovered that given the amount of material presented at the gigantic 53rd Annual Heckerling Institute on Estate Planning (January 14-18, 2019) in Orlando, Florida, which I attended, it was going to be no small task to compile a meaningful summary of the five-day conference materials, an academic ultramarathon comprising more than five large binders of printed material and a plethora of articles, many over fifty pages in length. Where to go and what to do? Well, there was nothing else to do but begin, and with that I was hoping the old saying “beginning is half done” would apply. Three months later, still at my desk surrounded by reams of materials and my article journey looking more like I had set off in a Russian-made Lada rather than the iconic Italian stallion, I had an epiphany. After covering and summarizing selected topics of interest over a broad spectrum, including the issue of divorce in estate planning, elder law caselaw updates, estate planning for foreign assets, dealing with I.R.C. Section 199, retirement plans and charitable giving, recent developments, private letter rulings, anti-money laundering ethics guidelines in terrorist financing, the selection of fiduciaries, tax basis planning, the modern American family, estate planning and minor children, powers of appointment, asset protection, and much more, including the uses of memorandums of intent, it occurred to me that of all the subject matter presented, possibly the most important takeaways from the Heckerling Conference on Estate Planning, and the two subjects that would be of most interest and value to our clients on a practical level, especially given recent experiences in our practice over the past five years, was the importance of proper fiduciary selection and the use of letters of intent. The eternal questions relating to who (and what) is a proper fiduciary were addressed. Who is fit to serve as trustee, personal representative, agent under a financial power of attorney, and health care agent? Attorneys should focus their individual planning processes around this issue, as proper fiduciary selection is likely the ultimate reason a plan will work as intended or otherwise fail. The attorney’s job is to offer solutions and choices, and to be a counselor. Fiduciary compensation is a big issue. The use of a “fiduciary protector” should be considered. Family structures and demographics in the U.S. have changed and continue to change. Married couples now comprise less than 50% of U.S. households. Unmarried couples, young and old, are the fastest growing demographic in this area. Understanding the differences between the traditional World War II, then “Boomer”, then Generation X, and now Millennial generations is key to our collective futures in estate planning, as is an understanding of the effects of divorce, blended families, same-sex and interracial marriage, multi-parent and single parent families, and reproductive technology. Intestacy rates appear to fluctuate depending on family circumstances and structure. Flexibility and pace of change dictate that trust design should include statements of intent, one for the trustee and one for the beneficiaries, especially where trusts are to last forever, along with the inclusion of a trust protector. Standard, oft-used form provisions should be reviewed to determine if they speak to the grantor’s true intentions and whether they address potential future conflicts between the trustee’s fiduciary obligations and the expectations of beneficiaries. Good trust design should recognize the potential for conflict between trustee fiduciary duty and the modes of flexibility now available to the trustee.

From the above we can infer that there is a huge generational gap between the person implementing a trust (the grantor) and the person or persons who will enjoy the beneficial interests of the trust (the beneficiaries). Juxtapose this chasm between the generations, age groups, values, lifestyles, attitudes towards marriage and family, and the evolving definition of what a family actually is, with the continuous changes in Maryland law (for example, the new Elective Share law and the 2019 introduction of decanting legislation), not to mention the same proliferation of statutory change throughout the other forty-nine states (some more than others), and the obvious competition between certain states for trust-related business and assets under management. Because of this divarication, and the reality that nearly all trust documents suffer from “legal document word processing dementia”, the act of showing the grantor’s intention in trusts has now become a standard part of the estate planning process. The problem is that for most estate planning attorneys and law firms that practice in the area of estates and trusts, especially those who subscribe to the “transactional estate planning” (TEP) school of thought, this vital component is lost on them (they are not consciously aware of it or otherwise do not consider it important). So if you are reading this article with the interest of a student, please take special note of the following important sentence as I repeat: the act of showing the grantor’s intention in trusts has now become so important, it must be considered a standard part of the estate planning process.

If you remain intentional, maintain an academic approach to your estate planning, and implement a trust purpose statement (also known as a letter or memorandum of intent), you will be rewarded with the fullest and most complete estate plan possible. You will be “speaking” mainly to the trustee, the person whom you will have carefully chosen (note again the importance of fiduciary selection) and who will internalize and represent your goals, values, and vision into the future, carrying forth your intentions, and by and through the trust purpose statement, whatever form it may take (provision in the trust itself), memorandum attached to the trust, or separate letter to the trustee, will convey your instructions to the trustee about he or she should use the discretionary powers expressed in the trust. As a basic example of why this is important, consider the common ascertainable standard, health, education, maintenance, and support (HEMS). What does this mean? How is the trustee to use his or her discretionary powers? To one trustee, say a Certified Public Accountant (CPA) with a conservative approach, HEMS may mean that the beneficiary must prove their essential need for distributions, with the trustee taking the approach that the preservation of assets is essential not only for the current beneficiary’s future, but for future beneficiaries beyond the current beneficiary; while another trustee may interpret HEMS more liberally, and administer the trust in a manner consistent with more nonconventional notions about the current distribution of funds, even to the extent of exhaustion, for the broader lifetime benefit of the beneficiary. You will also be speaking to a second group of persons – the beneficiaries – who need to know your intentions. Why? Because beneficiaries can cause many problems for trustees, making their jobs, and their lives, extremely difficult and their role as fiduciary impossible. This can cause plan failure in the form of lawsuits against the trustee, the depletion of trust funds in defense of lawsuits, the removal or even the resignation of the trustee, and more.

The role of the trustee was until recently comparably easier, simpler, and more predictable. But in today’s world of trusts, where new laws allow for massive flexibility and never before conceivable changes to trust design, even to the extent of significantly altering the structure of trusts and their outcomes, and where trustees must sometimes choose between the flexibility they are allowed by statute and how that flexibility may conflict with their fiduciary duty, it is incumbent upon grantors of trusts to expend significant time during the design stages of their estate planning to envision the future of the trust(s) they are implementing and create a world of instructions and parameters for the trustee to follow and for the beneficiaries to respect that expands upon the grantors true intentions for the trust and its beneficiaries. It is also the responsibility of attorney and law firms that provide estate planning counsel and advice to grantors of trusts to encourage and facilitate a process whereby outstanding trust purpose statements may be created and memorialized for the long-term future. And so, as it likely was in the beginning, we need to think in terms of “simple” – not necessarily a simple approach, but a simplicity in articulating our goals, desires, values, aspirations, and management parameters for the oftentimes perpetual trust entity that we have, in good faith and with the best of intentions, set in motion into the galaxy of the future.

Tags: The Memorandum of Intent, The Trust Purpose Statement
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Before you retire or leave full-time employment for other pursuits, consider the impacts of your decision on the financial well being of your future. The transition to your next phase of life, whether full or semi-retirement, adventure-seeking, or family-driven, requires thoughtful planning to avoid needless surprises that can mean the difference between financial success or financial stress. Whether you have been planning your retirement for decades or days, contemplating these six key retirement elements can help you avoid unexpected problems.

Health insurance and the cost of health care throughout your retirement years is the first key consideration. If you have been on an employer-sponsored plan, it is crucial to understand the depth and breadth of coverage options and associated costs when you leave your full-time employment. Health care costs will rise as you get older, and according to Fidelity Investments, the average 65-year-old couple will spend $280,000 on health care costs during retirement.

Fidelity Investments Retirement Planning

Medicare is a definite help once you reach the age of 65; however, it does not cover the cost of everything, which is why supplemental health insurance becomes necessary. Learn what Medicare does cover and then explore insurances that will fill in the gaps you most need to cover, such as dental, vision, and long-term care. If you are younger than 65, you will have to supply your health care coverage through vehicles like COBRA if that is an option available through your current employer. If not a COBRA plan you can try the Affordable Care Act (Obamacare). Employing this option and depending on your income, you may even qualify for a subsidy, but open enrollment periods are limited, and you must plan your retirement accordingly. Other insurance options include less robust coverage choices with short-term plans. These plans are only viable for generally healthy people who have no pre-existing conditions.

You may think you want to retire fully; however, it is not uncommon to shift gears and decide for a sense of purpose that you want to work part-time in your “retirement”. Depending on your age, part-time work may affect your social security benefits if you have already begun claiming them. The second key consideration then is to know what your social security strategy is. Most retirees do not want to hold off on receiving their benefits at the age of 62 but the longer you can delay the larger your monthly checks will become. Your benefit increases 6 percent annually until full retirement age and then 8 percent annually until you reach the age of 70.

Since over half of Americans ages 60 – 64 are still working full or part-time, it is critical to know what effect your wages will have on your social security benefits. Nearly one-third of Americans ages 65 – 69 are still in the workforce, and their earned wages are also affecting their social security benefits. The penalty, when exceeding the earnings cap, is short-term substantial. If you make more than $17,640 in 2019, for every dollar you exceed the cap, your benefit will be reduced by one dollar for every two dollars you earn. The monetary penalization will come back to you when you reach full retirement age in a higher monthly benefit check however it depends on your overall income, and up to 85 percent of your benefit is subject to federal income tax. The scenarios get complicated, and it is essential to understand the nuances of social security benefit rules and how they relate to your situation.

When you are preparing to retire the third key consideration is evaluating your tax strategies based on your income. You may have provided for passive and multiple streams of income, and they have distinct tax implications depending on the type of financial retirement vehicle or product. Many people have a variety of retirement incomes such as 401(k)s, IRAs, taxable savings, investment accounts, health savings accounts (HAS) and business or trust incomes. All of these assets have optimal times to tap into for retirement income because of tax consequences. Know your strategy especially since your annual income can affect what you pay for Medicare.

The fourth key consideration is to check what the risks are in your retirement accounts and income plans. By the time you retire, most of your financial portfolio should be in risk-averse financial vehicles. Evaluating and allocating your portfolio to include financially stable products like bonds or well-researched annuities is essential. If you do not have to be overly risky in your strategy, then, by all means, do not be. It is better to live comfortably, or even modestly, in your retirement years then throw everything you have on a betting wheel and come up empty-handed. If you have had the same investment strategy since you were in your early twenties, it is beyond time to re-evaluate your choices.

The fifth key consideration is to prepare for an adverse event by having a financial cushion. Most financial advisors recommend that you keep several years of your income away from market-driven investments and maintain the cash in more stable vehicles like money markets, cash, and other investments that have minimal risk. The rule of thumb is never put the money you need to maintain your lifestyle for the next three years at risk. That allows you time to respond to any adverse event that may crop up while maintaining your retirement lifestyle. This way, if the investment markets are down, you will not have to sell those assets, potentially at a loss, to survive.

Finally, the sixth key consideration is to prepare emotionally for the ups and downs and loss of identity that you have cultivated during your career. Many retirees have a difficult time transitioning to retirement when so much of their life has been defined by what they did for a living rather than who they are as a person. Many people become inextricably linked to their identity through their career and moving into retirement without that career identity can create unforeseen depression. If you do not have to work, it is important to create a new life purpose. Volunteering and mentoring is a fantastic way to help your fellow humankind and ward off feelings of loneliness and lack of self-worth. Also, prepare yourself that the money and those asset accounts you have worked so hard for all your life are going to reflect the change of retirement brings. It can be hard to watch withdrawals for your retirement living chunk away at what you worked so hard to build. Do not go to places of dark imaginings. Retirement spending is exactly what you worked for your entire life.

It isn’t always easy to transition to retirement life. Your working norm must be redeveloped into your retirement norm. Think carefully through the issues that will be most important to your success and well being BEFORE you retire.

Contact any of our five offices today and schedule an appointment to discuss how we can help you with your planning or give us a call at (443) 393-7696.

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