Question: We are a married couple in our 80s who live in a small community. We would like to use a living trust to avoid the cost of probate and maintain financial privacy about our modest assets. We recently saw a television news segment about how people could lose substantial assets if the trust is not set up correctly. We enjoy your comments printed each week in our local paper, but don’t recall seeing anything you have written about living trusts. Some of our questions are:

1) How can we find an honest, reliable lawyer to prepare a living trust? 2) How are fees determined? 3) Does the preparer need a list of assets and exact values to prepare the trust? 4) Could we could do the 'leg-work', i.e., could we take the forms furnished by a lawyer to the court house to transfer our real estate to the living trust?

Answer: Unless there are burning reasons to create a living trust, we generally opt against this type of planning. The fact that many of your questions deal with cost, coupled with the fact you have only modest assets, puts you in this category. We don’t believe the expense will justify the result you would achieve.

If avoiding probate is important to you, you can do so by titling bank accounts, and even your home, in a way that would pass them on to the survivor -- or even to your children at the second death – without the need for probate. Whether or not you have children, planning could be accomplished through a durable power of attorney in the event of your incapacity.

If you choose to move forward with a trust, in order to do a proper job, your lawyer will need a complete list of assets and values and, in our view, should assist you in ensuring that the transfers into the trust are accomplished. Otherwise, folks tend to leave assets out of the trust. Fees are generally charged by the work that is done for you, and are not based on your assets. But make sure you understand the fee arrangement up front, in writing, before you move forward. To find a qualified lawyer, we suggest you go to NAELA.ORG.

Question: My 78-year-old mother was misdiagnosed with dementia and improperly medicated until it was finally determined that she was severely depressed. But once we finally got her into mental health treatment, we found a marked reduction in benefits from Medicare because she did not need hospitalization. Why is it OK to pay to treat physical illness, but not illness of the mind? And why should her care not be covered in an outpatient setting, but covered if she was kept in the hospital?

Answer: You are not alone in asking this important question. It is unfortunate, however, that people don’t seem to raise these issues unless a family member is affected. Mental illness among elderly Americans like your mother is expected to become a growing problem with fifteen million elderly people expected to suffer from some kind of psychiatric illness by the year 2030. Managed care and mental health professionals are not prepared for the coming crisis.

When mental health services are provided, some are covered by Medicare and some are not, but in all instances, usual Medicare payments are reduced. A new Bill in Congress that would expand coverage for mental illness (S 486/HR 953) has received a lot of support. The National Alliance for the Mentally Ill (NAMI) is working toward equality for the mentally ill. Founded in 1979, NAMI has more than 220,000 members in more than 1,200 affiliate groups and coalitions that operate through the country. Through self-help and peer groups, participants can meet to share the pain, accomplishments, discomforts and challenges of living through illnesses like depression, schizophrenia, anxiety or bipolar. A non-profit grassroots family and consumer organization, NAMI works toward improving the lives of people affected by mental illness and their families. To learn more or to join, call (703) 524-7600 or visit NAMI.ORG.