3 Decidedly Dumb Ways to Leave an Inheritance for Your Children

Estate planning offers many ways to leave your assets to your children, but it’s just as important to know what not to do. Here are some things that are all too common, but textbook examples of what not to do or try….

“Oral Wills”

If you feel you have a good rapport with your family or don’t have many assets, you might be tempted simply to tell your children or loved ones how to handle your estate when you’re gone. However, even if your family members wanted to follow your directions, it may not be entirely up to them. Without a written document, any assets you own individually must go through probate, and “oral wills” have no weight in court. It would most likely be up to a judge and New York State Law to determine who gets what.

Joint Tenancy

In lieu of setting up a trust, some people name their children as joint tenants on their properties. The appeal is that children should be able to assume full ownership when parents pass on, while keeping the property out of probate. However, this does not mean that the property is safe.  It doesn’t insulate the property from taxes or the unexpected, including nursing home expenses and your children’s debts, divorce or other liabilities.

There’s another issue. By choosing this approach, you may lose STAR and other property tax exemptions as well as potential capital gains tax exemptions on sale of the property.   These important tax issues can be better managed through a trust which will also allow you greater control as situations change.

Giving Away the Inheritance Early

Some parents choose to give children their inheritance early–either outright or incrementally over time.  This strategy comes with several pitfalls. First, if you want to avoid hefty gift taxes, you are limited to giving each child $14,000 per year. You can give more, but you start to use up your gift tax exemption and must file a gift tax return. Second, a smaller yearly amount might seem less like the beginnings of a legacy to be invested for the future and more like current expense money for immediate spending. Third, if situations change that cause you to re-evaluate your giving, it’s too late. You don’t want to be dependent on children having to give the cash back. Finally, if you end up needing public assistance to pay for extraordinary medical expenses such as nursing home costs, the government will “look back” at what you have done with your assets over the five years prior to application, and penalise by refusing to pay for otherwise eligible care costs for a period of months leaving you in a medical and financial crisis.

Shortcuts and ideas like these may look appealing on the surface, but they can actually do more harm than good. Consult with an estate planner to find better strategies to prepare for your and your families’ future. Give us a call to see how we can help.

Safeguarding Your Estate Plan Against Three Worst-Case Scenarios

Here are three examples of worst-case scenarios with a descriptive demonstration of how a carefully crafted plan can address issues, from the predictable to the total surprise.

Scenario One: Family Members Battle One Another

You don’t want the people you care about most to get into a fight over your estate. Disputes over who should get what, how to interpret unclear or inconsistent instructions from you, or how loved ones should manage your affairs are common.

Lawsuits between family members can drain your estate and cause a permanent break in family relations. Infighting can lead to less obvious problems as well. For example, your daughter is named as executor, but she holds a grudge against your son. Your daughter cannot rewrite your will to leave him out. However, she could drag her feet with the administration, interpret the will unfairly, privileging herself over your son, or engage in other manoeuvres. Your son would have to hire a lawyer and potentially get involved in a legal battle. This is a bad outcome for everyone.

To prevent such scenarios, consider using an impartial (e.g. third party) trustee or executor. Moreover, speak with a qualified estate planning attorney to prepare for potential future conflicts among family members.

Scenario Two: Both Spouses Die Simultaneously

Many estate plans transfer assets to a surviving spouse, but what happens if both spouses die at or near the same time? This situation may be even more complicated if both spouses have separately owned assets or if the size of the estate is significant. In that case, asset distribution may depend on who predeceased whom and other factors. There are, however, ways to address this in an estate plan making it easier for your family to understand your intent, including:

  •  A simultaneous death clause that automatically names one spouse as the first to die;
  • A survivorship deferral provision, delaying transfer of assets to a surviving spouse, thus preventing double probate and estate taxes; and
  • A common disaster clause that names a final beneficiary in the event all primary beneficiaries die at once.

Scenario Three: Passing Away Overseas

Expatriates may need particular care in estate planning. If a death occurs outside the U.S., foreign laws may conflict with provisions of an American-made estate plan. Thus a plan may need to be reviewed both for the US and other nations’ laws. If you intend to live abroad for an extended period or own property in another country, it may be smart to draw up a second will consistent with that country’s laws, too. The starting point is completing your estate planning (will, trust, and other documents) here in the United States.

If you have concerns as to whether your current estate plan provides adequate safeguards against the unexpected or anything else you might be worried about, we are here to help. Contact our office for an appointment.

How You Can Build an Estate Plan that Includes Asset Protection

Estate planning to determine the way a person’s assets will be distributed upon their death is only the tip of the iceberg. From conservative incapacity planning to diligent probate avoidance, there is a lot that goes into crafting a comprehensive estate plan. One important factor to consider is asset protection.

One of the most important things to understand about asset protection is that not much good can come from trying to protect your assets reactively when surprised by situations like serious illness, bankruptcy or divorce. The best way to take full advantage of estate planning is to prepare proactively long before these things ever come to pass — and hopefully, many of them won’t. First, let’s cover the two main types of asset protection:

Asset protection for yourself:

This is the kind that has to be done long in advance of any proceedings that might threaten your assets, such as bankruptcy, divorce, or judgment. As there are many highly-detailed rules and regulations surrounding this type of asset protection, it’s important to lean on your estate planning attorney’s expertise.

Asset protection for your heirs:

This type of asset protection involves setting up discretionary lifetime trusts rather than outright inheritance, staggered distributions, mandatory income trusts, or other less protective forms of inheritance. There are varying grades of protection offered by different strategies. For example, a trust that has an independent distribution trustee who is the only person empowered to make discretionary distributions offers much better protection than a trust that allows for so-called ascertainable standards distributions. Don’t worry about the complexity – we are here to help you best protect your heirs and their inheritance.

This complex area of estate planning is full of potential miscalculation, so it’s crucial to obtain qualified advice and not rely solely on common knowledge about what’s possible and what isn’t. As a general outline, let’s take a look at three critical junctures when asset protection can help, along with the estate planning strategies we can build together that can set you up for success.

Bankruptcy

It’s entirely possible that you’ll never need asset protection, but it’s much better to be ready for whatever life throws your way. You’ve worked hard to get where you are in life, and just a little strategic planning will help you hold on to what you have so you can live well and eventually pass your estate’s assets on to future beneficiaries. Experiencing an unexpected illness, accident or even a large-scale economic recession could mean you wind up bankrupt.

Bankruptcy asset protection strategy: Asset protection trusts

Asset protection trusts hold on to more than just liquid cash. You can fund this type of trust with real estate, investments, personal belongings, and more. Due to the nature of trusts, the person controlling those assets will be a trustee of your choosing. Now that the assets within the trust aren’t technically in your possession, they can stay out of creditors’ reach — so long as the trust is irrevocable, properly funded, and operated in accordance with all the asset protection laws’ requirements. In fact, asset protection trusts must be formed and funded well in advance of incurring or defaulting on a debt and have numerous initial and ongoing requirements. Irrevocable trusts are not for everyone, but can be a great fit for the right type of person.

Divorce

One of the last things you want to happen to the nest egg you’ve saved is for it to be lost as a result of your child’s divorce. In order to make sure your beneficiaries (and not your former son/daughter-in-law) get the parts of your estate that you want to pass onto them — is a discretionary trust.

Protection strategy: Discretionary trusts

When you create a trust, the property it holds doesn’t officially belong to the beneficiary, making trusts a great way to protect your assets in a divorce. Discretionary trusts allow for distribution to the beneficiary but do not mandate any distributions. As a result, they can provide access to assets but reduce (or even eliminate) the risk that your child’s inheritance could be seized by a divorcing spouse. There are a number of ways to designate your trustee and beneficiaries, who may be the same person, and, like with many legal issues, there are some other decisions that need to be made. Discretionary trusts, rather than outright distributions, are one of the best ways you can provide robust asset protection for your children.

Family LLCs or partnerships are another way to keep your assets safe in divorce proceedings. Although discretionary trusts are advisable for people across a wide spectrum of financial means, family LLCs or partnership are typically only a good fit for very well-off people.

Judgment

When an upset customer or employee sues a company, the business owner’s personal assets can be threatened by the lawsuit. Even for non-business owners, injury from something as small as a stranger tripping on the sidewalk outside your house can end up draining the savings you’ve worked so hard for. Although insurance is often the first line of defense, it is often worth exploring other strategies to comprehensively protect against this risk.

Protection strategy: Incorporation

Operating your small business as a limited liability company (commonly referred to as an LLC) can help protect your personal assets from business-related lawsuits. As mentioned above, malpractice and other types of liability insurance can also protect you from damaging suits. Risk management using insurance and business entities is a complex discipline, even for small businesses, so don’t only rely on what you’ve heard online or “common sense.” You owe it to your family to work with a group of qualified professionals, such as your estate planning attorney and an insurance advisor, to develop a comprehensive asset protection strategy for your business.

These are just a few ways we can optimize your estate plan in order to keep your assets protected, but every plan should be tailored to an individual’s exact circumstances. Give us a call today to discuss your estate plan’s asset protection strategies.

The Real Life Perils of Online and Do-It-Yourself (DIY) Estate Planning

With the number of online and do-it-yourself (DIY) legal providers continuing to grow and advertise heavily, you may be wondering if you could do your estate planning with the help of these forms. The advertising is seductive. Ads say, “attorneys use similar forms,” “the cost is significantly less than hiring an attorney,” and “many of these websites and kits are created by attorneys.” Most folks think their estates are not complicated and many think forms are forms – and – attorneys just charge for forms, right?

Wrong.

All estate planning attorneys know that DIY estate planning is dangerous and those same attorneys make more money cleaning up someone’s DIY mess than they charge for an estate plan that works in the first place.

  • While completing the forms may seem easy and straightforward, a single mistake or omission can have far reaching implications that only come to light after you have become incapacitated or died.
  • With you not here to explain your intentions, your heirs may end up disappointed and confused; and they could end up paying much more in legal help to sort things out after the fact than it would have cost in the first place.

The results of DIY are tragic. Good people fall for the “estate planning is just a form” and they said they have attorneys on staff.

  • But, we’ve seen folks accidentally disinherit their beloved children, pass assets outright to a drug-addicted beneficiary, and create documents that have no legal validity or don’t control their assets.
  • We’ve even seen young children with no guardians named at the mercy of the court to determine their future.

It’s sad and frustrating. DIY companies mislead good people like you to make a few bucks; the results, often chaos and pain.

7 Factors Those Contemplating the DIY Route Should Consider

  1. Legal Expertise. Experienced estate planning attorneys have the technical expertise to draft documents correctly so they are legally valid and reflect your wishes. Yes, they likely start with pre-drafted forms, but they know what language to bring in as well as what to change and how to change it to make your plan work the way you want. They also understand the technical terms and legal requirements of your state. Laws vary greatly from state to state; and, a DIY program or kit may not tell you everything you need to know to prevent your plan from being thrown out by the court or failing to carry out your wishes.
  2. Counseling. Attorneys are called “counselors at law” for a reason. Estate planning attorneys counsel families and they have seen the results of both proper and improper planning. An experienced attorney can guide you with delicate decisions, including who should be the guardian of your minor children; how to provide for a child or elderly parent who has special needs without interrupting valuable government benefits; how to provide for your children fairly (which may not be equally); and how you can protect an inheritance from creditors and irresponsible spending.
  3. Explanation of Intentions. If there is any confusion as to what your intentions were after you are incapacitated or gone, the attorney, who counseled you, will be able to explain what you wanted. This unbiased interpretation from someone who does not stand to benefit from your plan can help avoid costly litigation by your beneficiaries, keep peace in your family, and maintain the validity of your documents.
  4. Coordination of Assets. A will only controls assets that are titled in your individual name. You probably have other assets that are controlled by a contract, joint ownership, and/or beneficiary designations; these include IRAs, 401(k)s, joint bank accounts, real estate, and life insurance. A will does not control these assets. An estate planning attorney will know how to coordinate your assets and estate plan so that your assets are distributed as you wish.
  5. Tax Planning. The federal government and many states have their own death or inheritance tax. State taxes often kick in at much lower exemptions than the federal tax. Careful professional planning is a must in order to avoid paying too much federal and/or state tax – and probate fees.
  6. Unmarried Couples. Being married creates rights and privileges under the law. If you’re not married, you need to create contracts and documents that will protect you and your partner. Because laws are frequently changing and vary greatly from state to state, it’s vital to have updated advice from a competent estate planning attorney. Without proper planning, many rights may be limited for unmarried cohabitants. Providing for your pets may also be very important to you.
  7. Complexity and Cost. Many people think their estate planning will be simple. But the reality is, most folks discover they do need some personalized planning…and you may not know that without the guidance and counseling of an estate planning attorney. It is far better to spend a little more now and make sure your plan is created correctly than to try to save a few dollars and have things turn out badly later. You won’t be around then to straighten things out.

Often a DIY estate plan is worse than no plan at all, but don’t let that discourage you. You wouldn’t participate in DIY surgery so forget the DIY law; the lawyers who work for those companies don’t represent you and they are not your fiduciary; they represent the company for whom they work. Only a lawyer you hire individually, usually with a written engagement agreement, is your fiduciary and must always act in your best interests.

Though your first priority needs to be a plan that protects you and your family, if payment is a concern, we will work with you. We have levels of planning to fit a variety of budgets as well as payment plans. We invite you to call our office right now to get you and your family truly protected.

The Value of Having a “Life Plan” in Estate Planning

All too often, estate planning is viewed as a transaction; just sign here, here, and here on a document: will, a living trust, and powers of attorney – then be off. But the best planning happens when an estate planning attorney can get to know the client on a deeper level, to uncover hopes, dreams, and aspirations. It becomes more about family and values, and it becomes a lifelong process instead of a transaction.

This process begins with having a plan for our lives. There is a certain power in planning. When plans are carefully thought through and written out, they tend to come true. A plan can also serve as a guide, helping to align our deepest values, beliefs, and goals with our financial resources so we can realize our dreams. Having a plan allows us to live richer, fuller lives — personally, professionally, financially, and spiritually.

How to Formulate A Life Plan

1. Think broadly and deeply about what matters most to you. If you had all the money you needed, what would you do with it? If you had only five or ten years to live, how would you live them? If you learned you have 24 hours left to live, what would you miss?

2. Take this vision, sweep away any doubts, and craft your ideal life in as much detail as possible. This action will energize you to achieve your vision in the shortest time possible. Goals are no longer something to be hoped for “some day,” but can become immediate and vibrant.

3. A thoughtful professional can help you identify obstacles and roadblocks that may be keeping you from achieving your vision. These are sometimes financial, but more often they are internal beliefs.

4. An experienced estate planning attorney can then recommend the best ways to achieve your goals. Quite often, we will put together a team of professionals from different disciplines to make sure all your needs are met. In addition to our office, the team may include a financial advisor, an insurance advisor, a CPA, a retirement plan advisor, and even a planned giving expert.

We will ask open-ended questions and listen carefully to the answers. The client, on the other hand, will need to be open, honest, and willing to make an emotional connection, with us and with him/herself. We will be building mutual trust and a relationship, one that can last for many years, possibly even into the next generation.

The result of this type of planning is a real life plan – not just a pile of papers – and is far more rewarding than any document-focused transaction.

Why Does a Living Trust Cost More than a Will?

Yes, you will likely invest more in trust-based planning than will-based planning because you get a whole lot more value. Comparing these estate planning investments is like comparing apples and oranges – and the overall investment may not be what you think.

  • A living trust document has more provisions than a will because it protects you and your loved ones while you are alive and well, while you are alive and not-so well, and after your death. A will only handles matters after death.
  • A properly prepared and funded living trust will avoid court proceedings at incapacity and death. A will provides no such protection and ensures court interference at both events, which can be very costly (in time, privacy, dollars, and stress) to your family.

Instructions at Death and Incapacity

  • Both a will and a living trust contain instructions for distributing your assets after you die.
  • But only a living trust contains your instructions for managing your assets and your care and providing for your loved ones should you become incapacitated.

A Living Trust Avoids the Costs of Court Interference at Incapacity and Death

  • A properly prepared and funded living trust (one that holds all of your assets) will avoid the need for a court guardianship and/or conservatorship if you become incapacitated.
  • The person(s) you select will be able to manage your care and your assets privately, without court interference.
  • A will is only effective after death, so it fails to provide instructions and assistance during any period of incapacity.
  • If incapacity strikes, your family would almost certainly have to ask the court to establish a guardianship and/or conservatorship for your care and your assets — a process that is public, time-consuming, expensive, and stressful.

What You Need to Know

  • The same living trust document that can keep you out of court at incapacity can also keep your family out of probate court when you die.
  • But a will requires probate. Depending on where you live, this can be costly and time-consuming. Probate is always public and open to nosey neighbors and predators.

Costs to Transfer Assets… Pay Now or Later

  • There may be some minor costs to transfer assets into your living trust when you set it up, and then from your trust to your beneficiaries after you die. But these will be minimal if you and your successor trustee do much of the work yourselves.
  • With a will, the probate court (with its costs and attorney fees) is the only way to transfer your assets to your heirs after you die. So you can pay now to set up your trust, transfer titles, and benefit from the trust during your lifetime – or you can pay the courts and attorneys to transfer assets after you die.

Actions to Consider

  • Find out what probate costs are where you live. If your state has a fee schedule based on the value of probate assets, this will be fairly easy. If it has “reasonable” fees, ask an attorney to estimate what these fees would be if you die tomorrow and, if you are married, and your spouse dies the next day.
  • Similarly, ask your attorney to estimate what the costs would be if you become incapacitated tomorrow and, if you are married, if your spouse becomes incapacitated the next day.
  • Practically speaking, this will be impossible to estimate because no one will be able to predict how long the incapacity will last or what complications might arise. The mere uncertainty of these costs should give you pause — and propel you to plan for incapacity.
  • Add these estimates to the cost of having a will prepared — and compare that to the cost of a living trust. When you make a true comparison, you may conclude that having a living trust actually costs less than a will.

And what’s the cost of a plan not working and you and those you love being vulnerable, losing control, and being tied up in court? What’s the cost of your loved ones having their inheritances seized and being left with a mess? For many folks, the investment in trust-based planning is a good one.

How to Align Insurance with Your Estate Plan

If you’re like most folks, you use a variety of insurance products to manage risk and protect you, your family, and your assets from losses caused by property damage, businesses, property, accidents, disability, retirement, and death. However, instead of considering these insurances as separate items, we suggest you make them part of an integrated, overall risk management plan.

Different Kinds of Insurance for Different Risks

Most insurance can be grouped in these general categories.

Property and Casualty Insurances: This would include insurance on automobiles and other vehicles, home, furnishings, jewelry, and artwork – and personal liability insurance, including umbrella insurance.

Business Insurances: Business owners need insurance on buildings they own, office equipment and computers as well as liability, worker’s compensation, errors and omissions, and business interruption insurances.

Health and Disability Insurances: Disability income insurance replaces part of your income if you become ill or injured and unable to work. Health insurance helps to pay for medical services received and long-term care insurance helps to pay for extended care that is not covered by most health insurances or Medicare.

Retirement Insurances: Annuities and other insurance products can help replace income after retirement.

Estate Planning Insurances: Life insurance is often used to replace an earner’s income; pay funeral expenses, debts and taxes; fund family and charitable trusts; fund a business buyout and compensate the surviving owner’s family; provide an inheritance; and equalize inheritances for family members who do not work in a family business.

What You Need to Know About Insurance

Remember, insurance is for risk management — to protect you, your loved ones, and your assets from potential areas of loss. If a risk is no longer there (the exposure ends or you are able to self-insure and cover the risk yourself), then the insurance coverage for that risk can be eliminated.

Actions to Consider

Trying to coordinate your own insurances and manage risks yourself is a daunting task. Instead, we suggest you work with a team of advisors who have the knowledge and experience to help you make sure your risks are covered at the appropriate levels, without duplication and unnecessary costs.

An advisory team usually includes your financial investment advisor; estate planning attorney; life, health and property/casualty insurance agent(s); and a CPA. Other members may be added to your team as needed. You will probably find that your advisors will welcome the opportunity to work on your team, because they want to provide you and your family with the best possible service and solutions.

We’re happy to connect you with the experts you need or work with the experts you already have in place.

How to Avoid High Octane Stress and Organize Information for Your Family

Think, for just a few moments, about what would happen if you suddenly became incapacitated or died. Would your spouse or family know what to do? Would they know where to find important records, assets, password, usernames, and insurance documents? Would they be able to access (or even know about) online accounts or files on your computer?

Would they know whom to ask if they need help? Would they miss assets or insurances you’ve paid for? Not knowing what’s out there, where to find it, and how to access it is extremely stressful and burdensome. If you put all of your information in a safe place and let loved ones know where it is, you’re providing for and protecting your family, instead of dumping stress on them at an already stressful time. Putting the effort in now, to establish a formal document inventory, will alleviate unnecessary anxiety and turmoil at one of the hardest times of their lives.

Key Takeaways

  • If you should suddenly become incapacitated or die, your family would need to know where to find the information they need.
  • Let your loved ones and trusted helpers know where to find your document inventory.
  • Do not assume your process will be readily understood by others; hold a trial run to make sure they can find and understand your records.
  • Keep your inventory current with a bi-annual or annual review.

Here’s the Information Your Loved Ones Will Need

There is a large volume of documents and information that your family would need during a calamitous event such as incapacitation (even temporary) or death. This basic list will help you start thinking of the critical information you would want your family to have within reach.

  • Legal documents (will, living trust, and health care documents; adoption, marriage, divorce, military discharge certificates; insurance policies, deeds, and car titles)
  • List of medications (with dosages) you are taking
  • List of your advisors (estate planning attorney, CPA, banker, insurance agent, financial advisor, and physicians)
  • Insurance policies (health, disability, long-term care, business, life, auto, homeowners, renters, and umbrella)
  • Year-end bank and investment account statements as well as the most recent quarter’s statement
  • Storage facility location, access method, and inventory
  • List of all assets and accounts, including location, account numbers, date purchased and purchase price
  • Safe deposit box location, list of contents and location of key
  • List of companies or people to whom you owe money (mortgage, credit cards, friend, etc.)
  • List of people who owe you money
  • Death, disability, pension, and insurance benefits from organizations
  • Past tax returns (6 years)
  • User IDs, passwords, and PINs for all financial, email, social media, photo sharing, bookkeeping, computer, and other online accounts

What You Need to Know

Your document inventory requires a methodical listing of both hardcopy and digital forms. While the effort will be more challenging at the start, the maintenance of the inventory is much simpler. Be mindful that your digital footprint will likely grow much faster in the future than it has in the past, but you’ll be able to keep up with it.

Additional Actions Necessary to Protect You and Your Loved Ones

  • Give current copies of your health care documents to your physicians and designated agent(s).
  • Keep your original documents in one safe place, like a fireproof safe. Make copies for the notebook described next.
  • Buy one or two three-ring binders to organize your personal and financial information. You can enter it by hand or create spreadsheets on your computer, but having it all in one or two binders will make it easy for your family to find and use. If you leave it on your computer, they may never find it. Include locations, contact information, account numbers, and approximate amounts.
  • Include a list of online accounts and how to access them (including passwords).
  • Clean up your computer desktop and put important files in an easy-to-find desktop folder.
  • Have a trial run. Ask your spouse or other trusted helpers (such as your successor trustee or executor) to pretend that he or she needs to access needed information.
  • At least once a year, but preferably every six months, review and update your notebook, computer desktop files, and usernames and passwords for online accounts.

We know that this paperwork is a pain and easy to put off, but rest assured that you’ll feel so much better when it is all in place – and so will your loved ones. Any questions about what documents to save and for how long – or – questions about making sure your estate planning documents are up to date so they work when you need them? Feel free to call our office. We’re always happy to help.

What These 4 Famous Estate Planning Debacles Can Tell You about Proper Planning

These four celebrity estate planning fiascos offer lessons about how to handle your own planning and legacies.

 

1. Pablo Picasso – The great Dada artist died in 1973 at 91 without a will, a status referred to as “intestate.” Of course, Picasso isn’t the first, or the last, celebrity to die intestate. However, after he died, his six heirs fought for six years over the wealth of assets he left behind. One lesson for us: Make sure you have your estate planning documents in place before you go.

 

2. Heath Ledger – It was a huge surprise, and disappointment, to millions of adoring fans when Heath Ledger died in 2008 at the age of 28. He did leave a will. Unfortunately, he didn’t update the will after the birth of his daughter. Fortunately for his daughter, the family decided to include her in the inheritance, which proves that sometimes people do the right thing. But what if his family had insisted instead on the terms of Heath’s will? One lesson for us: When there’s a big change in your family situation (or when you have a life changing epiphany about your core values and legacy), update your plans accordingly. Do not assume that just because you’re young and healthy that you will have lots of time to get things in order. Do not assume that, since you have a plan in place, it’ll automatically update to match your current desires and needs.

 

3. Philip Seymour Hoffman – Actor Philip Seymour Hoffman didn’t want his children to grow up as “trust-fund babies.” Fair enough, but he decided to leave his inheritance with his girlfriend, counting on her to care for his children on his behalf. The problem: there was no guarantee that would happen. Since the two weren’t married, Hoffman’s estate was hit with a huge tax. One lesson for us: A trust that includes your guidance about the proper use of the funds is better than hoping for the best with one that leaves your wishes undefined.

 

4. Tom Clancy – Author Tom Clancy left behind a huge fortune, but his estate planning documents weren’t clear about some of the important details. These issues led to drama for family members. One lesson for us: the more complicated your family, your assets, and your business dealings are, the more accurate, precise, and proactive you need to be in working with us on your estate plan.

 

Whether you’re just starting to explore the need for estate planning or you’re a seasoned veteran with a well-worn trust binder, we should all remember a few key points:

Have estate planning documents in place, even if you’re young and healthy and think you’ll have plenty of time to get things in order later.

When there’s a change in your family situation (marriage, birth, or death) or if you’ve changed your mind about something, update your plans accordingly. Do not assume that, since you have a plan in place, it’ll automatically update to match your current desires and needs.

Provide guidance to your family about how you’d like them to use their inheritance. Do not rely on hope or verbal instructions. The best place for guidance is in your trust or in an intent letter that can help your trustee manage your trust.

If you’re well-off or have complex assets, you need to work with your trust lawyer in a more proactive way to avoid potential missteps while still achieving your goals.

 

When you’re ready to draft your estate documents, give our attorneys a call to set an appointment.

Texting Codes for Seniors!

Young people have their texting codes. Now Seniors can have their own texting codes!

 

ATD: At the Doctor                                             GHA: Got Heartburn Again

 

HGBM: Had Good Bowel Movement               GGPBL: Gotta Go, Pacemaker Battery Low

 

BTW: Bring the Wheelchair                              LMDO: Laughing My Dentures Out

 

BYOT: Bring Your Own Teeth                          LOL: Living on Lipitor

 

CBM: Covered by Medicare                               OMSG: Oh My! Sorry, Gas

 

CUATSC: See You at the Senior Center          TOT: Texting on Toilet

 

DWI: Driving While Incontinent                      WAITT: Whom Am I Talking To ?

 

FWIW: Forgot Where I Was                              GGLKI: Gotta Go, Laxative Kicking In !

 

Thanks to Ruth Quinn