Life with MS

Who Can You Really Trust? Today's Preventive Moves

By Martin M. Shenkman, CPA, MBA, JD

When someone is diagnosed with a chronic illness, the need for developing a financial plan becomes paramount. When that chronic illness is multiple sclerosis, there are special considerations to address. As those living with MS know, the course of the disease is unpredictable; the effects range from mild to devastating and symptoms can come and go. During those times when you are unable to manage your finances, you may become vulnerable. But there are preventive actions you can take to minimize the risks.

Acknowledge the risks

Unless you admit that you could be a target now or in the future, you won’t take the risks seriously and likely won’t protect yourself. This is step one for everyone. Even if your kids (or niece, cousin, neighbor) are too good to “do that,” temptation can push even good people to do bad things – especially in times of dire financial circumstances. Do you really know that your family member, caretaker or home health aide is more concerned about your financial well-being than his or her financial gain?

Power of attorney

If you have MS and are age 18 or older you should have a power of attorney. This is a legal document in which you appoint a person (called an agent) to manage your financial, tax, and legal affairs if you can no longer manage them for yourself. Your power should be “durable,” meaning it remains valid even if you become unable to manage your affairs.

Many, if not most powers, permit the agent to make gifts. Gift language of various sorts is routinely included in standard powers. Carefully weigh the benefits of permitting gifts versus the risks of temptation for the agent abusing the gift power. It might be best to expressly state that your agent has no authority to make gifts. Consider appointing co-agents and an independent “monitor” charged with providing some degree of oversight of your agent’s actions. A “monitor” is someone other than an agent who can get copies of bank and brokerage statements and other information to “keep an eye” on your agent. These checks and balances are an important step to making a power of attorney protective rather than a tool for abuse.

Revocable trust

One of the most protective steps you can take is to establish a funded revocable living trust with an institutional co-trustee. With a bank or trust company as co-trustee along with you, you will remain in control of your assets and financial decisions as long as feasible, and financially safe from abuse. Fund the trust – that means transfer most of your assets to the trust (other than IRAs, a professional practice, or certain other assets). This is more secure since the institutional co-trustee can help keep tabs on the assets held in the trust.

Too many people erroneously assume naming a friend or family member as sole trustee is best. Often it is not. Be wary of standard (boilerplate) living trust forms. Most are overly simplistic documents designed to avoid probate that don’t really have the detailed provisions to protect you through a long-term disability. You, and then several named successors, should have the right to replace the bank/trust company with another bank or trust company. The best approach is to provide this power to an independent trust protector who cannot also serve as trustee.


The old saying “Keep it Simple and Stupid” should be a guiding principal to safeguard you financially. Consolidate assets to a few reputable and well-known institutions. Yes, it sounds simple and costs nothing, but consolidating assets into one institution (or as few as feasible in light of reasonable concerns about financial institution viability and insurance limits) is one of the most powerful steps to avoid financial abuse. A secure public institution with adequate insurance is ideal.

For those CD lovers, pick an institution that participates in the Certificate of Deposit Account Registry Service (CDARS) program. It allows investors to keep up to $50 million invested in CDs managed through one bank with full FDIC insurance, and under one agreement. Too many accounts and too complex a plan will make it harder to manage and update. If you have or develop cognitive issues, the simpler everything is, the easier for you to stay in control and avoid being abused financially.


Remember the Doublemint gum commercial? Double your pleasure and double your fun with duplicate copies of every monthly statement from each bank and brokerage firm being sent automatically to a trusted person (preferably not the agent under your power of attorney). If you have a long-time independent certified public accountant, that person might be a great choice.

The best and most cost effective arrangement, especially if you’re experiencing cognitive issues, is for a bookkeeper in your CPA’s office to balance monthly statements and send out a periodic report. This assures that at least a bookkeeper at the CPAs office is reviewing everything. If too costly, try doing it yourself using one of the inexpensive and widely available computer programs.

You might also name an adult child who is not your agent under your power of attorney (nor the current co-trustee under a revocable trust) to receive monthly statements. The consolidation, simplification, and independent review can minimize the temptation that agents and others in confidential and private relationships with you might feel. That creates real checks and balances.


Set up accounts for automatic bill payment from your checking account, payment of as many regular bills as possible automatically to your credit card, and payment plans with utilities and others that equalize payments every month. Anything that simplifies and creates regularity can make aberrations due to theft, fraud, or other abuse more obvious to spot. Anything on automatic payment will avoid your missing payments and will make budgeting simpler. You can determine what you receive each month (wages, interest, disability payments) and plan accordingly. Most importantly, if you have most bills and payments on automatic payment arrangements, if you suffer an exacerbation you will have dramatically minimized the issues you, or someone helping you, will have to deal with.

Inspection and oversight of agents

Include in your power of attorney (and revocable trust if you have one) a requirement for periodic mandatory reporting and reviews. This should include two types of oversight. One financial, such as discussed above, with your CPA and/or monitor. The second should be a periodic interview by a social worker or independent organization with you, and a requirement that they report in writing to your trustee.

This can create another important check on personal as well as financial security. You might not need this review now; you may never need it. But remember that once you put in place simple and protective procedures they will be functional when you do in fact need them.

Martin M. Shenkman, CPA, MBA, JD, is an attorney in Paramus, N.J., and New York City. His practice concentrates on estate planning and administration, tax planning, and corporate law. He has published 36 books, including “Estate Planning for People with Chronic Illness and Disabilities” (Demos). He was named by CPA Magazine as one of the top 40 accountants in 2008 and 2009. His free legal website  provides a wealth of free planning information for readers in a new and growing section on “chronic illness” and more comprehensive podcasts in the “seminar materials” section.

(Last reviewed 5/2010)