Checklist Before Passing on Wealth (Patreon)

After the resounding response to my last post... here is part II - Huge thanks to Sanjay who dug into all of this for us.

Pre-Transfer Checklist for Families & Clinicians

1. Screening the Elder’s Capacity & Consent

• Confirm cognitive capacity with brief screening (MMSE, MoCA, or equivalent).

• Document voluntariness: Is the elder expressing clear, independent intent without pressure?

• Ask directly if the elder feels obligated, guilty, or afraid regarding the transfer.

2. Independent Legal & Financial Advice

• Require the elder to obtain independent legal counsel (not chosen by the prospective beneficiary).

• Ensure a separate financial advisor/CPA review with written recommendations.

• Confirm market-rate valuation: If property/asset is involved, obtain an independent appraisal.

3. Documentation & Structuring

• Use formal, enforceable agreements:

• Loans: Written contract, repayment terms, secured by collateral (e.g., recorded lien).

• Gifts: Written acknowledgment, with notation of no expectation of return.

• Housing/“granny flat” deals: Register life interest, occupancy rights, or leasehold.

• File documents with relevant registries (land titles, banks, trust deeds).

4. Financial Controls

• Keep separate bank accounts for elder and child.

• Establish dual-signature requirements for large withdrawals/transfers.

• Mandate independent periodic audits of financial flows.

5. Clinical Red Flags (for physicians/nurses/social workers)

• Sudden requests for signatures on financial/legal documents.

• Repeated “loans” without repayment schedules.

• Elder reports tension with family about money.

• Abrupt isolation from prior advisors or friends.

• Signs of depression or anxiety linked to family financial demands.

6. Decision Tree (Simplified Flow)

1. Elder expresses intent to transfer assets?

→ No → Maintain current estate plan.

→ Yes →

2. Independent legal & financial review completed?

→ No → STOP, refer for review.

→ Yes →

3. Capacity & voluntariness documented?

→ No → STOP, assess for undue influence.

→ Yes →

4. Written, enforceable, and registered contract in place?

→ No → STOP, draft contract.

→ Yes → Proceed.

7. Governance Instruments

• Enduring Power of Attorney with fiduciary accounting duties.

• Trust structures (with at least one independent trustee) for significant transfers.

• Explicit gift/loan registers in estate files.

8. Post-Transfer Safeguards

• Annual review with legal/financial advisor.

• Regular medical/social check-ins for psychosocial harm.

• Audit trail: receipts, bank statements, property registry checks.