Advocating for Clients

In August of 2015, I got a phone call from John. John’s mother, Sally, was 79 years old and was beginning to show signs of memory loss. John explained that Sally would sometimes forget appointments or ask questions over and over. She owned a beach condo and insisted on keeping it because she used it so often (but in reality, rarely visited the beach). She would collect mail and stash it in drawers, stack it in piles around the house and sometimes move pieces from one pile or drawer to another without ever opening the envelope. Sally had accumulated years of account statements, tax documents, uncashed checks and junk mail by the time John and his wife stepped in to help sort out the mess. John’s ultimate request to me was this: “Can I bring you what we have, and will you help us figure this out?”

When John, his mother and I met for the first time, John brought a 12-inch stack of files with him. His wife had taken the time to sort out different monthly account statements and tax statements into separate, labeled files. Some statements were only a month old while others dated back to 2007. John wasn’t sure which of these accounts might even still exist. We decided to approach each company, one at a time, to ask whether the account was still open, the shares were still held, the outstanding checks could be reissued, etc. Before we could begin, however, we discussed the importance of making sure Sally had appropriate legal documents in place. Fortunately, Sally had already executed a Durable Power of Attorney and a Healthcare Power of Attorney, naming John as her agent for both. I began forwarding copies of Sally’s Durable Power of Attorney to each of the companies in question in an effort to open the line of communication.

The next time John, Sally and I met, we called each institution, explaining with each call that Sally had not touched base in a long time and that we wanted to confirm whether the account still existed. If it did, we moved forward with other questions – what was the current balance? What assets did the account hold? Could they forward us a recent statement? We spent a couple hours moving down the list, each time having to verify Sally’s identity, confirm John’s Power of Attorney was on file and then repeat the same list of questions in order to gain as much relevant information as possible. At the end of an exhausting couple of hours, Sally and John learned that Sally had $500,000 in IRA assets, an additional $200,000 in non-qualified assets and a hefty long-term care policy that had lapsed in March. What a surprise to them both!

At this point, the real work began. John and Sally agreed that having 10 or 20 accounts in different places was unnecessarily cumbersome, so they decided to roll all the IRA assets into one IRA and all the non-qualified assets into one brokerage account – no easy task considering Sally owned several individual stocks, some inherited stocks still in her late husband’s name, and other assets inherited from a late aunt. We also discovered that the last year’s Required Minimum Distributions had never been taken from Sally’s IRAs, and Sally had never filed her 2014 tax return.

We worked together to calculate cost basis, update ownership information and liquidate some of the holdings. Over the next few months, John and I consolidated Sally’s accounts, gathered the necessary 2014 tax documentation and collaborated with a CPA to file Sally’s 2014 tax return. It didn’t take long for federal and state tax notices to begin flooding Sally’s mailbox, and I helped John understand and respond to each one. We worked with the IRS and with the Taxpayer Advocate Service to draft a letter showing reasonable cause for not filing Sally’s 2014 tax return on time. We made sure Sally received her 2015 Required Minimum Distribution and set up future distributions to happen automatically.

We revisited Sally’s legal documents and updated her living trust, naming John as Co-Trustee so that the transition of Trustee duties would be painless. We checked Sally’s Social Security record to be sure she was receiving the correct Social Security payments and had properly signed up for Medicare. We verified Sally’s pension payments and set them up on direct deposit. We even found assets with the state treasurer’s escheated property division and facilitated a claim for their return.

For months, we worked with Sally’s long-term care insurance company to reinstate her policy. A neurologist confirmed that Sally was struggling with short-term memory loss, and we submitted his statement to the long-term care insurance company for review. Eventually, the insurance company agreed to reinstate the policy – 11 months after its lapse! I made sure that John was added as a third party for any missed payment notifications in order to prevent any future lapse. Looking back, it is still amazing to me what John, Sally and I were able to accomplish together. Sally still struggles with the here and now, and she is often convinced that she does not have any money. John frequently reminds her that she does, and that it is safe and sound with TFA.

Names have been changed for privacy purposes.

Triad Financial Advisors | 3623 N. Elm Street, Suite 102, Greensboro, NC 27455 | (336) 230-0071
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