Davis Wright Tremaine LLPP: “With the advent of higher exemptions with respect to the Federal Gift, Estate, and Generation-Skipping Transfer Tax passed last December (referred to as the 2017 Tax Act), it really is necessary to review your estate tax planning and it would also be a good time to review your durable power of attorney in light of the recent adoption of the Washington Uniform Power of Attorney Act, effective January 1, 2017.”
Question: I was recently divorced, but my estate plan names my former spouse in a few places. What should I do?
Answer: Revise your estate plan! You should always think about updating your estate plan when a major life event happens. Divorce or legal separation from your spouse is one of these events. There are probably a number of places in your current estate plan that name your former spouse. These are the areas that you should consider updating:
- Incapacity planning. Who did you name as your agent under your healthcare power of attorney or financial power of attorney? If you were to become incapacitated, your current estate plan probably says that your spouse should make all of your healthcare decisions and should have the ability to access your finances and make financial decisions. Since you probably do not want your former spouse to make these decisions for you, consider changing your healthcare agent and financial agent to someone like a trusted friend or family member.
- Inheritance planning. Your current estate plan probably states that if something were to happen to you, all of your assets should go to your former spouse. After a divorce, you probably don’t want your former spouse to inherit everything. As such, you should change the primary beneficiary of your will or trust.
- Life insurance. Your current life insurance policy might name your former spouse as the beneficiary of that policy. Talk to your life insurance company about updating the beneficiary designations on the policy. Another life insurance issue could arise if your divorce settlement requires you to maintain life insurance for your children. If so, you should consider creating an irrevocable life insurance […]
The Street: “Adult children and their parents are normally hesitant to discuss money or financial affairs as these subjects can be awkward. Even though such conversations are difficult it is better to have them while both parties can meaningfully engage in the discussion.
What do I mean by both parties can engage in the discussion? I mean the parents have the cognitive or mental capacity to communicate their wishes to their adult children.
According to a report by the Alzheimer’s Association, 5.2 million — or 1 in 8 Americans — over the age of 65 have Alzheimer’s disease. The same report also cites a study which estimates 13.9% of Americans over age 71 suffer from some form of dementia.
For the aging parent getting your financial house in order is the responsible thing to do for yourself and your children. Likewise, adult children would be wise to engage in this dialogue before capacity becomes an issue. When an aging parent is struck with Alzheimer’s disease or another from dementia it will be a draining and emotional experience for the adult child. Without proper planning it will be even more stressful.”
There comes a point in every person’s life when it is time to sit back and take stock of what you have accomplished. This could be a beautiful family, a lovely home or a thriving business. Whatever the source of your pride, it makes sense to protect it, just like you would any other asset. You protect your home and your business with insurance, but what about yourself and your family?
Protecting yourself and your family doesn’t have to be difficult or expensive. But it does need to be done. Here are the three must have documents everybody should have to protect themselves and their families:
1. Last Will & Testament
You probably know what this document is. It disposes of your assets after your death. Without a Will, your state of residence determines how your assets should be divided. But can you really depend on some ambiguous state laws to protect your family? Wouldn’t it be better to lay everything out in such a way that ensures your wishes are followed? This is what a Will does for you.
What many people don’t know about Wills is that a Will is where you name the guardian for your minor children. Don’t have a Will? Now the state gets to pick a guardian for your kids. Do you trust the state to pick the best possible person to raise your children? I don’t know many people who would.
Your Will also names the Personal Representative of your estate. This is the person responsible for administering your estate by paying your final taxes, paying any creditors and collecting and distributing your property. Once again, without a Will, the state will pick […]
The Journal: “Far too many people think, “I don’t have an estate. I don’t need to do any estate planning.”
But there are more aspects to estate planning than just signing a will. Medical, current financial and other decisions also play an important role.
The differences between the similar sounding living will and living trust often causes confusion. The first is for medical purposes; the other is financial.
A living will provides authority for certain last medical measures when in a terminal condition and has nothing to do with transferring assets or property after death.”
It’s hard to believe that someone would purposely starve a parent in order to collect the inheritance. I recently read an Estate of Denial article called Slowly Starving Her Mother to Get the Inheritance. Unfortunately, elder abuse cases are not uncommon throughout the country. Money is a powerful motivator and unfortunately, some people will stoop to the lowest of levels just to collect.
In the article, a woman was making medical decisions on behalf of her aging mother. The woman, who had suffered from drug and alcohol problems, had very little income. Her mother, however, had assets worth over $500,000. When the woman moved in with her mother to act as the mother’s caretaker, the woman began starving her mother. As time went on, the mother became very ill and lost a significant amount of weight. After a call from a concerned neighbor, Adult Protective Services got involved and insisted that the mother be moved to a care facility. Finding the cheapest facility she could find, the woman dumped her mother at the facility with no clothes, and instructions to not give her mother any food or let her out of bed because she was dying. She also instructed the care facility workers that no one was to talk to any of the mother’s friends or relatives about her mother. Unbelievably, the woman was actually trying to slowly kill her mother.
Thankfully, in this case there were people who cared enough to realize what was going on and get the mother some help. Not surprisingly, mom wasn’t dying after all.
How was this woman able to do these horrible things to her mother? She was named as […]
Lowell Sun: Q: I am an elderly gentleman thinking about granting power of attorney to my son, so he can handle my financial affairs now and after my death. What issues should I consider?
A: Among numerous considerations in granting someone power of attorney (or POA) over your assets, I will discuss some major issues. Please allow me to first correct a common misconception about a POA form and its ability to be used after death. Rights granted under a POA, terminate upon the death of the grantor. However, while you are living, a POA can be a great tool for convenient financial management.
When you give someone the rights of a power of attorney, you authorize the named person to make financial decisions on your behalf. The POA form acts as an authorization letter, allowing a bank or financial institution to deal with your named attorney-in-fact.
Continue reading more power of attorney tips.
Question: I made a Will, now what do I do with it? Where should I keep it and who should I tell about it?
Answer: You may have the best drafted, most well thought out Last Will and Testament, but it will be useless if no one can find it. There is no central database for Wills or estate plans. This means that the only way your loved ones will know about your Will and where to find it is if you tell them!
First, you should put your original Will and other estate planning documents in a safe place, like a safe deposit box. Tell the appropriate people that you have an estate plan and it can be located in your safe deposit box. You probably want to tell your spouse, children, parents or whoever would be the person searching for your estate plan should something happen to you. We also suggest making copies of your Will and other estate planning documents and giving them to person who you have picked to be responsible for administering your estate (your personal representative). Alternatively, you can scan the documents to your computer and email them to trusted people, or put the documents on a CD and give the CD to trusted people. This is an important step, not only with your Will, but also if you have healthcare directives or powers of attorney. If you created a Healthcare Power of Attorney, make sure you give a copy to the person you designated as your healthcare agent. That way the person knows they have been nominated as your healthcare agent, and know where to find the document giving them authority to make decisions […]
Question: I’ve heard the phrase Power of Attorney but I don’t know what it means. Do I need a Power of Attorney?
Answer: A Power of Attorney is a legal document in which in a person (called a “principal”) delegates decision making authority to another person (called an “agent”). Powers of Attorney can be very broad giving the agent the ability to do every act that you could do yourself if you were able, or Powers of Attorney can be limited to cover only specific decisions and events.
When people refer to a Power of Attorney, they are usually talking about either Healthcare Powers of Attorney or Financial Powers of Attorney. As the name suggests, a Healthcare Power of Attorney allows the named healthcare agent to make medical and healthcare related decisions for the principal if the principal becomes incapacitated and unable to make decisions on their own. As long as you are able to make healthcare related decisions on your own, your healthcare agent will have no authority to make those decisions for you. A Healthcare Power of Attorney only becomes effective if you are incapacitated. A Financial Power of Attorney allows the agent to make financial decisions on behalf of the principal if the principal is unable to make those decisions on their own. This includes the power to manage financial assets, buy and sell property, pay the principal’s bills and more. While your Financial Power of Attorney becomes effective if you become incapacitated, it can also become effective immediately if necessary. This may be a good idea for people who will be leaving on a military […]
NJ.com: Today Your Legal Corner will address “Basic Estate Planning.”
What will you do with this New Year given? Perhaps you want to lose 10 pounds, make plans for a spring garden, change jobs, travel to Europe or dedicate time to a coveted project. Just think of the possibilities this New Year brings.
One goal to definitely include is to review or create an estate plan. A basic estate plan consists of completing an inventory of present assets, defining goals, relationships, and realities; and then developing a plan of action.
Generally, most estate planning begins with an inventory of the assets. If you would like to receive an Inventory Packet, simply request one by email, phone or letter and it will be provided, free of charge.
The Inventory Packet is a guide used to list assets, state where assets are held, and define preferences and relationships. Once completed, the Inventory Packet will aid in deciding what type of estate plan is needed. The Inventory packet should be kept with the will.
Goals, Relationships and Realities
Quite often, the difficult questions have not been answered. While it is difficult to predict the future, estate plans must still be created with goals, relationships and realities in mind. For example, what are your long term goals? Where would you choose to reside as you age? What does retirement look like for you? Will you travel? Will you continue to work? Do you have long-term care insurance?
Each estate plan should address the possibility of nursing home living. At the very least, have a plan in place as to with whom or where you would reside in […]
US News & World Report: Because you’ve worked hard to create a secure and comfortable lifestyle for your family, you’ll want to ensure that you have a sound financial plan that includes trust and estate planning. With some forethought, you may be able to minimize gift and estate taxes and preserve more of your assets for those you care about.
A qualified financial professional and tax professional can help ensure you are minimizing taxes and maximizing gains for your heirs. You can bring this four-part checklist to your initial meeting to discuss how to make your plan comprehensive and up-to-date.
Part 1: Communicating your wishes
•Do you have a will?
•Are you comfortable with the executor(s) and trustee(s) you have selected?
•Have you executed a living will or healthcare proxy?
•Have you considered a living trust to avoid probate?
•If you have a living trust, have you titled your assets in the name of the trust?
Part 2: Protecting your family
•Does your will name a guardian for your children if both you and your spouse are deceased?
•If you want to limit your spouse’s flexibility regarding the inheritance, have you created a Q-TIP trust?
•Are you sure you have the right amount and type of life insurance for survivor income, loan repayment, capital needs, and all estate settlement expenses?
•Have you considered an irrevocable life insurance trust to exclude the insurance proceeds from being taxed as part of your estate?
•Have you considered creating trusts for family gift giving?
Read the rest of this article here.
Online Athens: I want to highlight some of the most common estate planning mistakes I think people routinely make (knowing that I can’t possibly cover them all in one column). You will notice that I’m not going to discuss the estate tax beyond saying that very few people are subject to it and that it can be effectively managed by an attorney and financial planner with expertise.
In my experience, No. 1 and No. 3 are the root causes of the other issues.
1. Failure to plan: I am constantly surprised to see how many people do not have basic estate planning documents in place. The statistics consistently say more than 50 percent of Americans do not have a will, so if you happen to have one, the odds are that one of your neighbors does not.
Estate planning is another one of those areas in financial planning that plays to our desire to procrastinate. The only immediate payoff we have to getting the core documents in place is to quiet that inner voice that constantly says, “I need to take care of this.”
With proper planning, many negative consequences such as not passing your assets as you wish, strained family relationships and even a lawsuit can be avoided.
Simply stated, dying without a will is easy, but picking up the pieces afterward is not. On the other hand, getting a basic will in place should not be complicated.
CBS Boston: We talked about dumb money moves last week and many listeners let me know that there is a whole lot more than the ones we talked about.
Estate planning is not for just for the wealthy. If you have some assets you have accumulated such as your home or retirement accounts or if you have children you have people and things you need to protect.
What estate planning does is allow you to plan. Plan for the day when you are not around to care for the loved ones in your life or plan on how your assets are to be distributed upon your death. Sounds easy but no one wants to talk about their own mortality or morbidity.
Nevada Appeal: Clients often admit that they procrastinated before engaging me, largely because they didn’t know what estate planning entailed. Though the process involves some work, a law office that focuses on estate planning matters can walk you through it so that you develop a comfortable understanding of what you are getting and why.
When developing an estate plan, you’re planning for the management of your finances during life, and for the eventual transfer of all that you own. When considering a trust-based plan, you and your attorney need to look at all of your assets to determine how they fit into the plan. More importantly, you’ll need to look at loved ones and professional contacts to determine who warrants your trust in managing the biggest transaction of your life. Then, you need to talk about your beneficiaries. Whether it’s your kids or your favorite charities, how they should receive your assets is all part of the discussion.
If your estate is more complicated, your attorney may want to work directly with your financial adviser or your accountant, and he or she may become one of your long-term advisers. The good news is that the more issues or complications you have without a plan, the more value you’ll receive from obtaining one.
Barrington Patch: Powers of Attorney are important components of most estate plans. Today’s column explains the purpose of two types of Powers of Attorney — the Power of Attorney for Property and the Power of Attorney for Health Care.
Hello Lisa, My wife and I recently met with a lawyer to have our wills done. The lawyer told us we should also have “Powers of Attorney.” We don’t understand why. Could you please explain why we should have these Powers of Attorney? Thanks, Joe
Thanks for your question. Many people share your confusion about the purpose of a Power of Attorney (POA). First of all, it is important to understand that there are two different types of POA’s that are central to most estate plans.
24-7 Press Release: Thinking about life going on after your death and how your family will cope is never pleasant. But if you do not focus on your estate plan now, there is the possibility that your loved ones will be left with nothing, and may even have some unwanted bills after you pass away.
Without an estate plan, you leave your family with an uncertain future. As plans can differ from person to person and family to family, it is important to meet with an attorney experienced in estate planning to discuss which documents best suit your needs. If you already have an estate plan in place, make sure you regularly review it with your attorney to ensure that it still meets your goals.
24-7 Press Release: Estate planning is not only for the super-rich, or even just moderately wealthy individuals. Wills, medical directives and trusts accomplish many things. Whether you need to set up a guardianship for your children or obtain peace of mind for future health care decisions in the event you are incapacitated, estate planning is now a versatile and straightforward way to manage end-of-life planning.
North Jersey.com: Two months ago a close family friend had a heart attack.
Fortunately he came through it and is on the mend. But the experience — including concerns about who would make medical and financial decisions on his behalf, if needed — served as a reminder that he and we need to get our financial houses in order.
Most of us don’t like to think about these “what if” decisions.
But as more of us become eligible to join AARP or care for aging parents, it is critical that we make sure that we are ready.
And that means preparing key documents — including a will, power of attorney, advanced medical directive and a medical proxy — and keeping each up to date.