What the heck does an Executor do?

I was conducting an Elder Mediation a while back where an issue came up with respect to choosing an Executor to handle the parent’s estate.  It was interesting to watch the dynamics as family members discussed why someone should or should not be the Executor.  The parents for instance initially thought that their oldest child should be the Executor because it was the “role” they felt the oldest should perform simply by default – She was the oldest of four children.

As the discussion moved along I realized that there was a vagueness of understanding from some family members as to the role and responsibilities of an Executor so I went on to explain what some of these responsibilities were.   I then asked my friend Gregg Medwid  who is the President of Executor Support to provide me with information which I can pass onto my clients.  And in his true professional manner – Gregg sent me an email with an excellent explanation along with a fabulous checklist which I want to pass onto you.

What is an executor?

An executor is someone who  carries out your final wishes, as described in your will.  This is a very  responsible role, and usually requires a considerable amount of time.  The  executor, who may also be one of the beneficiaries, will take ownership  and  possession of the assets, arrange for payment of any debts, and distribute the  proceeds of the estate to the beneficiaries.  The executor is, in effect,  taking on the same rights and responsibilities of the deceased.

The executor starts  by arranging the funeral and then begins to settle the estate.  S/he needs  to inform all parties of the death, including government agencies, banks,  pension offices and employers, and then all of the assets and liabilities need  to be identified, including their values on the date of death.  Some  assets may need to be appraised.  A complete inventory should be prepared,  and any valuable assets protected (eg. house, art).  All accounts  (including online accounts), subscriptions and memberships need to be  cancelled.  Many estates require the will to be probated, so the executor  will arrange to have the documents filed in court and will pay the necessary  fees.  A source of funds may need to be arranged in order to pay for probate and a variety of other expenses.  Detailed bookkeeping records  usually need to be maintained, and these  accounts need to be passed by the beneficiaries.
At least one income tax return must be filed, possibly more, including an  estate income tax return, and any income tax owing must be paid.  Insurance claims may need to be filed, as well as claims for government  benefits (eg. CPP Death Benefit).

Although the  executor is responsible for arranging payment of debts, s/he is not responsible  for the debts themselves.  If there are insufficient funds in the estate  to pay all outstanding debts then the estate is considered to be insolvent.

Throughout the  entire process there should be frequent communication with the family and other  beneficiaries in order to keep everyone well-informed and avoid any  disputes.  This point cannot be over-emphasized, especially in those  families where there is very little communication or where animosity exists.

It’s OK to ask for help.  The executor is entitled to receive whatever assistance they may  need, such as a lawyer, accountant, notary public or consultant, and these fees are typically paid out of the proceeds of the estate.  The executor is  also entitled to receive a fee for their service, up to approximately 5% of the  value of the estate.

In the event that  someone dies without a will (ie. intestate), rather than there being an  executor, someone must offer to be the administrator.  The rights and  responsibilities of an administrator are similar to those of an executor.

Executor Checklist

With the information Gregg has provided, you and your parents can have a useful discussion regarding who best to be the Executor of your parent’s estate?  As it turned out, the family  I mentioned at the beginning of this article made some different decisions based on factors such as their adult children’s careers, capabilities and family responsibilities.   The mediation resulted in the family making an informed decision with a complete understanding and agreement of why those decisions were made.

“Executor Support does not provide legal advice. The information provided herein is intended as general information only, not as legal advice, and readers are encouraged to seek their own legal counsel.  Executor Support does not prepare or submit applications for Letters Probate or Letters of Administration.”

Casting call for all Vancouver Stepfamilies

I received a call from HGTV - They have a new show premiering this fall called CONSUMED and are looking for families who need help decluttering their home and their lives.  This is not a Hoarders show but rather a show about regular families who just need help organizing their home to make it functional and livable.

Among the many issues and challenges Step Families have to deal with, organizing their home to meet the needs of their family can feel like an overwhelming task.  What do you do when there isn’t enough room?   If step siblings have to share a room how can their individual taste be displayed while at the same time respect each others differences? How do you accommodate children who only live with you on a part-time basis?  How do you make their personal space just as important as the other family members who live in the house on a full-time basis?

As you can see – lots of issues and concerns and help is the way….

If you are experiencing  space and clutter challenges with your Step Family, here is a wonderful opportunity to have professional organizer Jill Pollack come to your home and work out a solution to meet the needs of all the family members.

Who are financially abusing our Seniors?

I recently received a call from a family in distress.  The senior couple is desperately trying to help their son who has a series of mental and physical health issues but there is one catch… the son has learned that by threatening, yelling or pleading for money is quite effective in getting what he wants and before he drains their savings account, the family has reached out to try to get some help.

Unfortunately, their story is not unique.  I have seen three cases of senior financial abuse in the past month! Financial abuse against seniors has become a huge concern in North America and the predators are usually a family member, friend or trusted neighbour.  Yes, I call them predators because every one of these people have learned how to manipulate the seniors and found where they are most vulnerable.

But why would a family member or friend do this to someone who trusts them?

1. Many feel that they are owed something for the assistance they are providing them
2. They say it is due to them if another family member was given some financial assistance
3. Drug/Alcohol addiction – they need to feed their habit
4. Build up of anger or hurt from long ago – it is a way to “get back” at their parent

Seniors need to be protected but many are too scared to say anything to anyone because they rely on the person who is abusing them as a care provider.  Another threat that is commonly used is that the care provider will abandon the senior and leave them isolated and alone.

What can be done?

If the senior has expressed concerns and/or if someone in the family has concerns that this may be happening they have a few options;

• Report it to the police
• Report to the Public Guardian and Trustee who will investigate
• See if there is a way in which Elder Mediation can deal with the issues and concerns with all the family members and the senior

Elder Mediation can assist the families in providing information on what kind of tools can be put into place to ensure a caregiver is being financial responsible.  The new  Guardianship Act effect September 1st 2011  has tightened up the guidelines in a Representation Agreement in order to ensure Representatives are more accountable in handling a persons finances.  Another layer of safety in a Representation Agreement is to appoint a Monitor who has the ability to request an accounting of records from the Representative.

It is important that the senior and families are educated on Senior Abuse (Financial, Physical and Emotional) and help them make decisions that are going to ensure the Senior is in a secure, healthy and safe environment.

Unfortunately it is not the “snake oil” salesperson, telephone & internet scams we just need to watch out for in protecting seniors – many times they need protection from their own family.

Sad but True

Creating a Business Partner from a Divorce

Did you ever think that you and your ex would become business partners?…. Probably not.

This is how I help to explain the process of mediation for couple going through a divorce or separation.  Think in terms of the relationship changing from one of intimacy to a business partnership.

In a business partnership everyone has the best interest of the Corporation (the Children) as the centre of focus.  In order for a business partnership to be successful, the partners need to meet on a regular basis, discuss the issues and concerns of the Corporation and ensure effective communication is followed in order that the Corporation is healthy and productive.

I use this analogy since couples seem to understand and relate to it.  They know exactly what is an appropriate way of communicating and acting at their place of employment and after a divorce/separation it really should not be any different.  The focus needs to be on the children and if the couple is having a difficult time communicating is a civil, productive manner then they need to refocus their communication to that of speaking to a partner or business colleague.

Here are some tips

1. Keep the topic focused and to the point
2. Don’t try to bring up a bunch of issues all at the same time
3. Take the focus off of your reaction and onto the issue at hand and how it affects the children positively or negatively
4. Listen to your ex and ask for clarification to understand rather than defending your position

In a corporate environment, these tips help Partners & colleagues figure out the problem and remain open to brainstorm ideas to find the best solution for the Corporation.

It is no different for couples who choose Mediation for their Divorce or Legal Separation – They approach each topic with the intent on finding a solution in the best interest of their children and to help everyone move forward in their lives.

Step Family Life – Fantasies of Happiness fade quickly

Are you in a recently formed Step Family?

Do you feel positive and optimistic that your family will simply gush happiness, fun, togetherness and exude absolute family amazingness?(Is that even a word?)

I hate to be the bearer of bad news but if you are recently formed and your family demonstrates all these wonderful traits… It probably won’t last.

The good news is if the happiness fades quickly then what you are experiencing is well – “Normal”.  Normal that is for Step Families as they move through the phases and stages of Step Family life.

There has been a lot of excellent research done on Step Families by the likes of Mavis Hetherington, Patricia Papernow, James Bray to name a few.  Step Families go through phases, stages and cycles as they evolve into a cohesive step family unit.  The first few years are usually fraught with conflict as everyone tries to figure out roles, rules and boundaries.

There hasn’t been one step family I have worked with who formed their step family with the thought of “yah, let’s do this even know we know there is going to be a lot of arguing and family dissention”  Just doesn’t happen.

Families come together with the parents thinking they are going to be Better, Stronger, Happier than in their previous relationship. They have high hopes and even higher expectations.  However, it doesn’t take too long to discover that Step Families are hard work.  There are two biological families trying to figure things out and usually what happens in the beginning there are two family camps which are formed.  These camps are biological connections so Mom and children in one camp with Dad and children in another camp. It doesn’t matter if the children live with these parents or their other biological parent – camps are initially formed because blood relations are the natural ties that bind them. It takes some time for Step Families to get into their own rhythm (average is 4 years) and there will always be bumps along the way.

The sooner a Step Family understands and accepts that the Happiness fades quickly and the real work has begun the sooner they can adjust and move onto the next stage of Step Family life which involves Mobilization and Action.

Divorce and Step Family Studies – Do they still apply?

In 1972 Dr. E. Mavis Hetherington launched a study on divorce that morphed into the most comprehensive longitudinal study entitled the Virgina Longitudinal Study that lasted 30 years.  The reason for this…. The original 2 year study was to research the effects of divorce on family members but then something happened – these divorce couples got remarried and this became a whole new dimension of family life that needed to be scientifically researched.  Mavis Hetherington along with the help of author John Kelly wrote about her results in the book “For Better or For Worse – Divorce Reconsidered”. 

Here is a quick snap shot of some interesting statistics gleaned from this study;

Living through divorceTop findings of E. Mavis Hetherington’s longitudinal studies tracking a total of 1,400 families include:•Seventy-five percent of children do well after living through divorce.•About 25 percent of children experience major problems or emotional difficulties. This compares to 10 percent of children in non-divorced families who experience major behavioral or academic problems. Those experiencing difficulties often exhibit anti-social behavior, trouble in school and problems in social relationships.• Even though they often face economic hardship, many women are enhanced after divorce. They develop competencies they probably would not have if they had stayed in conflictual, unhappy marriages. Two years after divorce, women are less depressed than those who remain in conflictual, unhappy marriages. Some women look like “super women” — they achieve success at work while being good mothers and active in church, philanthropic and community activities.• Men, on the other hand, are usually not enhanced by living alone after divorce. Men do better in terms of economic, social and psychological well-being in a marriage, even in an unhappy marriage, than when they are single.

“This, to some extent, explains the rapid and high rate of remarriage in men,” Hetherington said.•Boys are rarely enhanced by divorce. However, some girls, like their mothers, become exceptionally confident and competent after divorce.•Fathers are more likely to maintain contact with their sons than their daughters after divorce.• Women, by more than a two-to-one ratio compared to men, initiate divorce. About one-quarter of men report that they were surprised when their wives wanted a divorce; they were not aware that their marriage was in serious trouble.•When a divorced mother fights with her son, her negative mood lasts far longer than when she fights with a daughter. Mothers find raising a son alone more stressful than raising a daughter alone.• When women have casual sex after divorce, depression and declines in self-esteem often occur. One-night stands sometimes trigger suicide attempts in divorced women. • In contrast, men immediately after divorce enjoy the sexual smorgasbord” arrangement. However, by about a year after divorce, men get tired of casual relationships and want a more committed, intimate relationship.

I love this book – not only because it is so well written, but I reflect and refer to it like one would their Bible, Dictionary or Personal Journal.  It helps shed some light when I mediate couples going through a divorce or trying to find their way in their new Step Family. 

But here’s my problem….

This study is nearing 10 years old since the original findings were published.  Although there was an onslaught of other’s researching Divorce and Step Families, none are within the last 8 years.  Canadian and U.S.A. Census do not clarify if a family is a Step Family.  Census does take Common Law relationships into consideration but it does not give us a full updated picture of couples taking the plunge, remarrying and letting us know how successful/unsuccessful this really is.   We are left to still guess - I have read various reports stating anywhere from 42% to 56% of re-marriages fail and the other statistic report that this % increased to 60% when couples form a step family but live in a Common Law relationship.

Why does this matter?

The “old” research shed’s some light on the issues/needs/concerns of families going through a Divorce/Separation & Step Family but are these the same issues/needs/concerns from 10 years ago?  If so, then we are not implementing enough programs for families to learn how to deal with them.   If the statistics are in fact still the above mentioned 42-56% in 2011 then Step Families are still floundering trying to figure how their new family system works.

We may be waiting a long time for government programs to be implemented so if you or someone you know is experiencing Step Family challenges then click on the link entitled “Take Our Survey” on this website and let us know what’s going on for you – what’s working well, not so well and be a part of creating something in the 21st Century to help other Step Families.

What do Canadian Caregivers look like?

What does a Canadian Caregiver look like?  Are they young, old, men, women, friend, family?  Well the statistics have been gathered and the single most important message in this blog… You and your family better have a plan in place on how you want to receive care as you age because one thing is for sure – you’re family members will be involved in caring for your needs and to what extent will be determined by you. 

The fact is that most care-givers are assigned by default and usually occurs when a crises happens (mom breaks her hip) or upon the eventual decline of a parent’s ability to care for themselves as they age.  The default consists of a) You live closest to your parent(s) than the other family members and/or  b) you happen to be female.

The following are some demographics of Care-giving in Canada;

• 61% are women
• 17% care for a friend or neighbour
• 83% care for relatives
• 59% of caregivers work full or part-time
• 90% of  care giving is informal – meaning that the person does not receive pay
• 6% of those over the age of 75 are providing care
• 20% of Canadians over the age of 45 provide care to a senior

The greatest effect on overall stress for the Care-giver is;

1. Level of care
2. Whether they had a choice in the decision to become a caregiver
3. Caregiver’s own health
4. Most stressful aspects for caregivers are incontinence, bathing and dementia
5. Alzheimer caregivers have three times more stress symptoms

Deciding on who will be the main caregiver in a family should not be made by default!

Supporting the main caregiver is just as important as caring for the senior.  If the main caregiver gets burned out because they do not have regular and consistent help then they are of no use to the senior and in fact it can put both the senior and the main caregiver in danger of declining health and/or elder abuse resulting from stress.

Then there is the broad discussion of caregivers roles and responsibilities – that will be for another time.

I can not stress enough how important it is to have this discussion with not only your parents but also your children. If you are in your 50′s or 60′s then it is not too early to start evaluating the cost associated with being cared for and how these costs will be funded.  There are a lot of out-of-pocket costs that caregivers incur and if/how they are to be reimbursed opens up another can of family worms. 

Plan now, have a back up plan and be prepared  This is the key to successful caregiving.

In Fear or Losing Your Pension… There are options

This is one of the hottest issues when it comes to the division of assets in a Divorce or Separation.  I regularly hear remarks such as “There is no way he/she is going to get my retirement pension. I worked for that money – they didn’t!” (btw I eliminated the swear words that typically are included).

So what is the scoop about pensions and even more importantly – what are some options?

Pensions that are included as a family asset are;

• Employee/Employer Pension Plans
• Registered Retirement Savings Plans
• Canada Pension Plan

Important Points;

1. Common-law spouses don’t automatically have rights to a former spouse’s pension however this does not mean they can not receive a portion of their ex-spouse’s pension if they either agree to share, opt into Part 6 of the Family Relations Act, have a cohabitation agreement that addresses pension division or they argue a constructive trust.
2. For legally married couples it is important to know that there is a 2 year deadline after making a divorce order to apply for division of pension benefits. 
3. For legally married couples, Pension division entitlement is calculated from the date of the marriage to a  triggering event such as the date of separation or as otherwise agreed upon.
4. CPP credit splitting is available to both legally married and common-law couples.  The entitlement is calculated from the date of cohabitation to a triggering event.  This is an important point since many people live together for a few years, get married and then some years later get a divorce or separate.  They must have cohabited for at least one year and been living separate and apart for at least one year.
5. There is no time limit in CPP credit splitting to apply except upon the death of a spouse in which the application then needs to be made within 3 years.

What are your options if you don’t want to divide your pension?

It’s important to understand that just because the law states that pensions are part of family assets and are to be included in a divorce asset division, doesn’t mean that you don’t have options.

Options you can consider are;

• If both people have pensions that are reasonably close in value then they may decide to waive entitlement.
• Perhaps one party needs an immediate injection of cash so rather than splitting a pension which has not matured,  the couple may agree to sell the home and instead of splitting the net asset 50/50 they split is 60/40 in favor of the party who needs the cash and that party agrees to waive entitlement of the other party’s pension.
• The spouse’s share is very small (because of a short marriage or because the plan member has not accrued very much pension entitlement)  so compensation can be resolved by receiving another asset.

Before making any decisions about pension division, it is important to find out from the fund administrator how much money is involved by requesting that they provide a summary based on the agreed dates or marriage/co-habitation and trigger date. 

 When couples come to me for divorce mediation, and pension division is up for discussion, they come to understand that division is not carved in stone and there are options that can be negotiated in a mediation. They do not have the same flexibility if they go to court. 

Pension division is a complicated area of the law and I always encourage my clients to seek legal advice before signing off on a division of a pension. It is important to be completely aware of your rights and to receive an adequate share.  When you have an opportunity to discuss fair compensation in mediation and this information is provided to your lawyer then this eliminates conflict in an area that is generally full of strife.

Step Children – Aren’t they the best?

So Little Johnny or Little Lucy who were so sweet and loving before you got married have some how/some way turned into terrible, rude, indignant creatures.  OK – that may be a little harsh…they aren’t creatures they are however terrible, rude and indignant.

What happened?

It’s not easy to pinpoint ONE source so what I will do is spell out a few and you can decide if one or all may be the culprit.

1. Divided Loyalties: Now that their biological parent is re-married the reality of mom and dad not getting back together has set in.  It is important for the children to know that both biological parents love them and it is reciprocated and one of the best way to show this is to not be pleasant to the Step parent.  The step parent is an easy target at this early stage since they have not earned the child’s trust or respect.
2. Step Family Cycle: There are three stages in a step family.  The first is years 1 to 5 where most of the turbulence appears. There is a heck of a lot going on in this stage and two groups of family members are trying to jockey for position, figure out what that position even is and try to combine needs and wants of all the family members.  The jockeying and the unknown can cause a lot of conflict and confusion. 
3. Children are of adolescent Age:  Yep – depending on their age when the step family comes together can play into the “ugliness” of step children.  If they are older than 12 then the chances are they will have many more issues with a step parent.  Even if they were younger when you first got together, once children reach adolescence the family conflict starts up again.  By the way, this is the third stage of the Step Family Cycle.  At this stage the conflict has more to do with the fact that the children are experiencing hormonal changes and becoming young adults than the Step Family dynamics itself.
4. Ex-spouse interference:  Who knows better than the biological parent how to bring up their child?  Well, according to the biological parent – they know whats best.  If they feel their parenting role is being threatened in any way then they are naturally going to retaliate.  What better way to do this than to discredit the step parent.  Discrediting or overruling decisions are a common problem among the ex-spouses.   I have lots to say about that but I won’t at this time.

These are just a few possible items that may be the cause of a step-child turning on a step-parent.  There are a  lot more but that will be for another blog.  Also the solutions to the points made above will be discussed in the next Step & Blended Family topic.  So you will just have to check in and check it out.

And remember “Communicating in Conflict – There is a better way”

Private Care Agreements

For many seniors and their families, they are property rich but cash flow poor meaning that the only significant money they have is tied up in their principle residence.

How do they pay for care when they don’t have the cash flow?  For many seniors they have chosen a route called a Private Care Agreement.  In return for a relative or friend caring  for them as they grow older, the senior transfer the title of the property to the care provider.

This allows the senior to remain in their home for as long as possible and the caregiver is compensated in the end. However, this arrangement is frought with legal, moral and ethical challenges.

In Margaret Isabel Hall’s paper “The Care Agreement: Attractions and Pitfalls”  published in the Elder Law Review Vol2 (2003)  She lists a series of questions that need to be answered in creating a Care Agreement such as;

• What if the caregiver pre-deceases the senior?
• What if the caregiver becomes ill, or otherwise develops problems that prevent him or her from looking after the senior properly?
• What is the effect if a senior enters a care facility?
• Who makes the decision about when the caregiver can no longer provide adequate care, and admission to a facility becomes necessary?  Will this be a subjective decision to be made by the caregiver or the senior, or an objective decision to be made by a doctor?
• Does the promise to provide care include nursing type services or is it limited to the provision of food and lodging?

Most private care agreements are made informally which lends itself to unclear guidelines, miscommunication and legal interpretation.   Most care agreements fail because of relationship breakdowns due to the emotional aspect of the senior” giving up their home” and the caregiver “taking control”.  Just think about it…..

You have been living in your home for the past 30 years and now there is a person making decisions for you and your home while your still in it.  It may be very difficult for the senior to treat his or her ‘own’ home as really belonging to someone else and become resentful of the caregiver – after all, the senior is giving up control of their home and themselves.

If a Private Care Agreement looks as thought it may be a good option to explore then it is imperrative that a very clear, concise agreement be drafted to include items such as;

1. List the type of care provided
2. # of times per week it is provided
3. Back up arrangement should the care provider become ill
4. Who & How will it be determined that a transition to an institutional care facility should occur
5. How will the “value” of the caregiver be determined
6. How will this agreement affect other family  members and has this been adressed

Setting up a Private Care Agreement means that you have entered into a contract with another individual.  It has  been suggested that a probationary period and a termination clause be included to take effect on specified events.  The termination clause protects the resident should the specified agreements or relationship  deteriorates without the necessity of suing to rescind the contract.

Private Care Agreements can work as long as the parties do their due diligence in discussing as many of the “what if’s” scenarios as they possibly can, put the agreement in writing with clear direction for all parties to follow and seek legal advice prior to formalizing the agreement.   As an Elder Mediator, my role is to assist the parties in addressing the “what if’s” and help formulate the plan while providing information during it’s development.