Sibling rivalry can make planning tricky
November 25, 2015
Siblings often battle for years over inheritances.
A sibling of the late guitarist Jimi Hendrix and a company linked to another sibling only recently reached a settlement in a suit involving the rock star’s estate. Hendrix died in 1970 without a will.
Their dad, Al Hendrix, died in 2002 and left control of the estate to one of the siblings.
But these types of fights can be avoided, according to a story in the Wall Street Journal.
It can require not only a will, but also detailed instructions regarding jewelry and other family valuables, naming a professional fiduciary as executor and communicating your wishes before your death.
The story details a long and drawn out fight between siblings over their mother’s $15 watch. The mother had bequeathed her jewelry to her daughters to split “as they may decide.”
Such instances can result in siblings becoming estranged for life.
Better if you plan ahead.
Stay Up On New Estate Planning Laws
November 18, 2015
Deciding how to pass on your assets to your heirs is an integral part of the estate planning process. But what’s the smartest path, since tax laws change from time to time?
Beneficiary designations on life insurance and retirement plans are one way to keep away from probate, that time-consuming, costly process where the courts oversee the distribution.
A revocable grantor trust is one tool to help people avoid probate, according to a story on usatoday.com.
You, as the grantor, or person making the gift, convey assets to yourself as the trustee in charge of the trust. You have control over the assets during your life. You can alter the trust or revoke it. When you do, your successor as trustee conveys the proceeds to beneficiaries.
In years past, people would have to spend time deciding whose trust would be funded with what assets. They would typically set up two trusts for married couples so they could pass along double the amount of tax-free proceeds to their kids – now $5.43 million per person, or $10.86 million from the two parents.
The problem had been when one spouse died and that person’s trust went to the survivor. When the second spouse dies, the $5.43 million ceiling applies.
But the IRS eased the rules, allowing for portability. It means the surviving spouse’s trust can use any unused portion of the deceased partner’s exclusion, a benefit for heirs. The change is prompting many people to redo their trust as a single one. But there can also be disadvantages. The article suggests discussing the matter with your estate planning attorney. Recent changes to state and federal laws have made certain documents outdated, it says.
A Will Only One Planning Tool
November 11, 2015
If someone only has a will, can the executor make medical decisions for that person?
A column on nwitimes.com says the answer is no.
Estate planning is more than a will. It involves not just who gets your stuff, but also putting your affairs in order to address a number of issues after death.
There is a good chance of becoming incapacitated. As a result, you should have something in place to address that issue.
The will is the meat and potatoes of your estate plan, the column points out. But there is more needed. If you want something that will help you out while you are still alive, an estate plan is the answer.
It includes power of attorney to authorize someone to make financial decisions on your behalf, a health care representative to make medical decisions for you and a trust so probate can be avoided after you die.
Free Health Care Proxies for Veterans
November 9, 2015
Local law firm to provide FREE Health Care Proxies for Veterans on Veteran’s Day.
In honor of Veteran’s Day, the law firm of Dutcher & Zatkowsky will create a Health Care Proxy, free of charge, for any Veteran who visits the firm on Wednesday, November 11th. Walk-ins are welcome and no appointment is needed.
A Health Care Proxy is a legal document that allows an individual to authorize, in advance,
a person to make health care decisions on his or her behalf in the event of incapacity.
You have served our country.
We welcome the opportunity to be of service to you in return.
Avoid Estate Planning Mistakes
November 4, 2015
The biggest mistake in estate planning? Not having an estate plan.
An article on wealthmanagement.com says that 38 percent of those with assets topping $1 million have not gotten professional help with their estate plans.
This error can leave a big mess for your loved ones to clean up.
- Failing to sign your will.
- Tax errors. Many people believe if they don’t have assets in excess of $5.43 million (the federal exemption) they don’t need a plan. They probably do.
- Not keeping your plan up to date. Situations change.
Estate Planning Blunders
October 28, 2015
There are many common mistakes people make when they are doing their estate planning.
Here are a few, as listed in a story on consumerreports.org.
- You feel you are too young or don’t have enough assets. There are many reasons to need an estate plan no matter your age or how much money you have.
- You place everything in joint ownership. This is a common mistake one parent will do after the death of the other. They add a child’s name to various assets but this can place the assets at risk.
- You forget that a will does not include retirement plans or insurance policies.
- You can have your legacy squandered by turning your assets over to someone who can’t handle the money. Better to put into a trust that turns the money over to the beneficiary over time in many cases.
- You spark sibling rivalry. Make sure to ask each child if there is some item he or she particularly wants.
Young Folks Also Need Estate Planning
October 21, 2015
Estate planning is not just for older folks. Young people often need estate planning too.
Think about the recent, highly publicized deaths of young people like Bobbi Kristina Brown or the various young people gunned down in movie theaters by madmen or terrorists.
These cases confirm the need for estate planning for young people, according to a story in Forbes.
Not only does an estate plan make up a key part of your financial planning, but it gives you a voice as to what you want done in the event you are not around to or able to speak. It gives direction to those left behind on how you want things handled.
These can include how you are medically treated if you are unable to make a decision.
It also includes who handles your social media accounts if you are unable to or can’t.
And it can take care of your burial expenses, among other things.
So there are good reasons for younger folks to have estate plans.
Three Keys To Preparing A Will
October 14, 2015
When it comes to preparing your will there are three things you may not know. And they are basic. Here they are, courtesy a story on wealthmanagement.com.
- A will doesn’t actually cover all of your assets. Such assets with beneficiary designations are not included. These are such things as 401(K) plans, IRAs and life insurance. So make sure your beneficiary designations are consistent with your will. Also, assets held in a trust are handled outside probate.
- Take care in naming your will’s executor. This requires a lot of work and some brains. You can choose a spouse, child or trusted friend. Or you can name an attorney.
- Be extra careful in writing your will if you have young children. In most cases, they cannot handle inheriting a large sum of money or property. So you should take care in naming who would act as guardian.
Three Big Estate Planning Errors
October 7, 2015
Way too many people are trying to handle their estate planning without the help of an attorney or financial advisor, says an article on thestreet.com.
Actually, 38 percent of those with investable assets of $1 million or more have not sought professional help with their planning, the story says.
The biggest mistakes people make, according to the story , are:
- Failing to sign a will. If you make a will, but don’t sign it, you have no will.
- Tax errors. Many people with assets worth less than the $5.43 million federal exemption for estate taxes think they don’t need estate planning. There are many other benefits to having an estate plan than saving on federal taxes. For example, many states, including New York, have their own estate taxes.
- Negligence. If you have an estate plan but it is out of date, that can be a big mistake. You must periodically review and update your plan.
Some Barriers To Estate Planning
September 23, 2015
Estate planning revolves around preparing for a future that you won’t be alive to see. Not a pleasant thought. That’s why so many people put it off. They just don’t want to think about a world without them in it. It is scary.
However, those fears result in procrastination, indecision and inattention, according to a story on financial-planning.com.
Fear is a huge reason for procrastinating, the story says. Plus, people are busy in the here and now. But the story says folks should actually fear doing nothing.
People often put off action because of indecision, the story says. They can’t decide on a guardian for their children, for one thing. But that choice can always be changed, it notes.
Inattention is also a problem. Maybe you have a will but it hasn’t been revisited in years. Things can change in time. That’s why it is important to take another look at your will every year or so.