The phone rings at 2:00 am that wakes you up out of a dead sleep. You roll over in bed and grab the phone that’s on the nightstand; fog fills your head as you say hello.

On the other end of the phone is the hospital emergency room in the town your elderly parents relocated to.

The nurse on the phone informs you that your father fell out of bed and is in the ER with what Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... appears to be a broken hip. They are asking for the authorization to do surgery to repair the hip.

Since you are his healthcare proxy, you are now the decision maker for his healthcare.

Your mother, who diapered you, raised you, and helped you build a volcano for your 4th-grade science project, who was your Boy Scout leader is in the ER with your dad.

Mom has dementia and is still relatively early in the disease state.

Dad had been taking care of mom at home, as he promised her he would….she would live out her final years at home.

You arrange a flight, pack your bag, email your boss and head for the airport.

At the hospital, you find your dad recovering from surgery; your mother is in his room waiting for a neighbor to come pick her up.

Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... You walk out to the nurse’s station at the top of the floor and ask to speak with the hospital social worker.

The hospital social worker informs you that your father will need inpatient rehab and you need to arrange for care for your mother. They also suggest that you meet with an elder law attorney to assure that your parent’s financial arrangements are made.

The social worker gives you a list of local elder law attorneys.

You have no idea who any of the attorneys are and no idea of how to find one that is good.

The neighbor gets to the hospital and offers to take your mother home and spend the day with her. You ask the neighbor if they know any good attorneys or any on the list that was provided to you.

They recognize one name, you call the lawyer who agrees to meet with you the following day.

Your father wakes up from the anesthesia, he’s groggy but manages to tell you where he keeps all of his financial records. This includes his will, healthcare proxy, durable power of attorney that gives me the ability to act on either and both parents behalf with all assets, his and my mothers DNRs and other critical papers.

He then doses off into a blissful slumber.

The next few hours are hectic as the orthopedic surgeon, your dad’s cardiologist, rehab specialist and social worker are in to meet with you. Everyone confirms that dad will need to go to rehab for at least 30 days.

You are exhausted as you grab the rental car from the hospital parking lot and head to your parents home. Arriving home, you thank the neighbor and start to make dinner for you and your mother.

Post dinner, you pull out the financial records and start to go through them. Your parents have CDs, annuities, stock portfolio, savings accounts and the family checking account. You find the will and set it aside.

Knowing that your parents have a substantial sizable estate, you pull together the balances of the various accounts and place all into a folder for the meeting with the attorney in the morning.

You help mom get ready for bed, tuck her in and walk over to the guest room, where you collapse.

There’s a strange sound coming from your mother’s room; you look at the alarm clock, and it’s 6:00 am. Mom is talking to herself about an event from her youth.

Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... Getting mom up, fed breakfast, dressed and showered fills the next two hours of the morning. You get mom into the rental car and head to the attorney’s office.
Meeting the Elder Law Attorney…

The attorney introduces herself and asks what she can do for you. You explain the chain of events that brought you into their office. Together you review the records, and she immediately starts reviewing your options. Since dad had taken care of the typical power of attorney, healthcare proxies, DNR’s. We were left with how we dealt with their assets.

The attorney suggests that due to your parent’s medical conditions, their assets be placed in a trust with you acting as the trustee. Your parents have enough assets to pay for their care for the balance of their years, so with Medicare, private health insurance.
The attorney rattles off the types of trust there are:

Revocable Trusts. …
Irrevocable Trust. …
Asset Protection Trust. …
Charitable Trust. …
Constructive Trust. …
Special Needs Trust. …
Spendthrift Trust. …
Tax By-Pass Trust

Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... The elder law attorney informs you that all assets that are put into the trust they belong to the trust itself, not the trustee.

The assets will be governed by the rules and instructions of the trust contract. A trust is a right in property, which is held in a fiduciary relationship by one party for the benefit of another.

The trustee is the one who holds title to the trust property, and the beneficiary is the person who receives the benefits of the trust.

In essence, a trust is granted the rights to the property, and a trustee is appointed who has a fiduciary duty to act for the benefit of another person or persons. The trustee is the one who holds title to the trust property, and the beneficiary is the person who receives the benefits of the trust.

The trustee holds title to the trust property, and the benefits of the trust go to the beneficiary. While there are a number of different types of trusts, the basic types are revocable and irrevocable.

The most common types are revocable and irrevocable, both have their nuances.
Revocable Trusts

Living or revocable trusts can be changed or revoked by the maker of the trust during their lifetime.

The maker of the trust transfers the title of property to a trust, serves as the initial trustee, and can remove the assets from the trust during his or her lifetime. Revocable trusts are extremely helpful in avoiding probate. If ownership of assets is transferred to a revocable trust during the lifetime of the

Revocable trusts are used to avoid probate court. Assets put into a revocable trust are owned by the trust and at the time of the maker of the trusts death. These assets are not subject to probate court.

A revocable trust is not valid asset protection strategy. Assets transferred to the trust remain available to the maker of the trust creditors.

Typically, a revocable trust is moved into an irrevocable trust with the death of the maker of the trust.
Irrevocable Trust

An irrevocable trust is one which cannot be altered, changed, modified or revoked after it has been created.

Once a property is transferred to an irrevocable trust, no one, including the person who created the trust can take the property out of the trust.
Asset Protection Trust

An asset protection trust is a trust to protect a person’s assets from claims of future creditors.

These types of trusts are often set up in countries outside of the US, although the assets do not always need to be transferred to the foreign jurisdiction.

The purpose of an asset protection trust is to protect assets from creditors.

Asset protection trusts are usually structured so that they are irrevocable for a set term and the maker of the trust is not a current beneficiary.

An asset protection trust is normally structured so that the undistributed assets of the trust are returned to the maker of the trust at the retirement of the trust assuming that there is no pending risk of a creditor attack, allowing the creator of the trust to gain total control over the protected assets.
Charitable Trust

Charitable trusts are trusts which benefit a certain charity or charities.
Avoiding or lowering estate and gift tax is the primary reason charitable trusts are set up.

A charitable remainder trust (CRT) that is funded during the trust grantor’s lifetime can be a financial planning tool, providing the maker of the trust with critical lifetime benefits.

Other than the expected economic benefits, there are altruism benefits that the trustee receives. Charities usually honor the donors who have named the charity as the beneficiary of a CRT.
Constructive Trust

A constructive trust is established by courts based on particular facts and circumstances.

Based on circumstances and evidence, a court may decide that there was an intention by the property owner that the property is to used for a certain purpose or go to a particular person.

While a person may take legal title to the property, equitable considerations sometimes require that the equitable title of such property belongs to someone else and the court will rule as such creating a constructive trust.
Special Needs Trust

A special needs trust is set up for a person who receives government benefits so as not to disqualify the beneficiary from such government benefits.

Special needs trusts are legal and permitted under the Social Security rules with the provision that the disabled beneficiary cannot control the amount or the frequency of trust distributions and cannot revoke or alter the trust.

Ordinarily, when a person is receiving government benefits, an inheritance or receipt of a gift could reduce or eliminate the individual’s eligibility for government benefits.

A special needs trust, the trust provides for luxuries or other benefits which otherwise could not be obtained by the beneficiary.

Special needs can include medical, dental expenses, medical equipment, education, rehab, eye glasses, purchasing a car for transportation, maintenance, insurance including premiums on insurance on the life of the trust beneficiary, spending money, computer equipment, vacations, movies, trips, money to purchase gifts, payments for a companion, and other items to enhance self-esteem. The list is quite extensive.

This allows the trust beneficiary to obtain the benefits from the trust without interfering with their eligibility for government benefits.

Most special needs trusts have a provision which terminates the trust if the trust would make the beneficiary ineligible for benefits.

Disabled persons who expect an inheritance or another large sum of money may establish a special needs trust themselves, provided that another individual or entity is named as trustee.
Spendthrift Trust

A spendthrift trust is set up for a beneficiary and does not allow the beneficiary to sell or pledge away interests in the trust; assets are protected from creditors until the trust property is distributed and given to the beneficiaries.

Tax By-Pass Trust

A tax by-pass trust is usually set up for federal estate tax purposes.

This type of trust is created to allow a spouse to leave money to the other spouse while limiting the amount of federal estate tax that would be payable on the death of the spouse.

While assets can pass to a spouse tax-free, the remaining assets over and above the exempted limit would be taxable to the children of the couple, when the surviving spouse dies.

A tax by-pass trust avoids the tax issue and saves the children of the couple thousands of dollars in federal taxes, based on the value of the estate.
Totten Trust

A Totten trust is a revocable trust in which the gift is not completed until the grantor’s death or an unequivocal act reflecting giving the gift during the grantor’s lifetime.

An individual or entity can be named as the beneficiary.

Assets in a Totten trust avoid probate, upon the trust makers death.

Real property cannot be held in a Totten trust. This is a very safe and efficient manner to transfer cash and liquid assets to family members.

To create a Totten trust, the title on the account includes language, such as “In Trust For,” “As Trustee For,” This language determines the beneficiary.
What’s Next?

After meeting with the elder law attorney, I decided that there were many unknowns on my parent’s health status.

A hip fracture is a traumatic event that many seniors do not recover from. Also, my mother was going to need increased care and assistance as her disease state advanced.

My parent’s house was a burden to them in many ways, the outside maintenance was tremendous, and they did not need to be burdened with it.

It was time to sell the house and look at alternative living arrangements.

My dad was still very active, he loved to golf and play poker with his friends several times a week; my mother would need help, and her needs would increase as dementia continued to rob her of her facilities.

Overall, they needed to maintain their quality of life, independence and enjoy their time left without the day to day burdens of a house or trying to care for an aling spouse. Most caregivers die before the person they are taking care of from the stress.

I did not want to see this happen to my family.

Having thought though this, I needed to head back to the hospital and check on my father, and I wanted to have a frank discussion with him if he was up to it.

Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... Arriving at the hospital, I found my dad sitting on the side of the bed with a physical therapist working with him. He was fatigued, as expected, however, he looked great, in some pain, but way better than I had expected.

The physical therapist informed me that he would be moved to a rehab facility in the next 48 hours.

This added to my sense of urgency; we had decisions that would need to be made now, not later.
Assisted Living / Step Down Facilities

Carol Forden Dad Broke His Hip...Dealing with Aging Parents.... After talking with my dad, I met with the hospital physical therapist and social worker; collectively we agreed that my father would be transferred to a rehab facility that was an assisted living/step down facility.

This would allow my mother 24-hour care and give my father the care he needed.

We also agreed that I would take over the management of my parent’s financial affairs, an irrevocable trust would be established for their care and needs.
Lessons Learned

Coming out of this experience, I would suggest that everyone take the time before something happens and sit down with your parents to discuss their wishes and plans if something happens.

The 2:00 am wake up call is a harsh awakening.

Thankfully, my father recovered and is back to golfing a couple of days a week. My parents are now living full time in the assisted living facility, we sold their home, and they purchased a condo unit. As their care needs increase, they have the ability to move into a higher level of care unit.

My father seems happy; he can come and go as he needs and my mother has aides that help her with basic hygiene needs and more.

We dodged a bullet, and for that I am thankful.

Author's Bio: 

Carol Forden is a Freelance Content Writer and Marketer.

Cut Through The Noise.Let my words create content that engages customers and builds trust in your brand.

Specializing in B2B Technology, Education, Healthcare, Health Tech, Marketing, Manufacturing, Law, and Real Estate.