Monroe Township NJ Estate Planning and Elder Law Attorney Blog | Neel Shah - Part 2
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Does the State Get Everything If I Pass Away Without A Will?

May 7, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

There are plenty of different reasons to use an estate planning lawyer to help you write a will, but worrying about the state claiming entitlement to all of the inheritance you leave behind should not be one of them. The legal term for passing away without a will is known as dying intestate.

State law does kick in and each state has unique rules about who inherits what. But many people are under the false impression that the state claims all of the property and either sells it or distributes it based on their needs. In some states, a surviving spouse and minor children will share the assets of a deceased parent, but this depends on your individual state laws. Typically, a spouse and children are first in line to inherit.

One of the most important things you can do is to write up a will. Even if the state doesn’t get your money regardless, you still want to have a say over who does. Do not leave that decision up to state law and interpretation from a third party who is not familiar with you and your unique family dynamics.

Work together with a knowledgeable estate planning lawyer to discuss how a will can help address many of the common concerns related to the closing out of your estate.     

If You Have Children, You Need A Will

May 6, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

You might have heard in the past that it is extremely important to put together the most basic of estate planning tools; a will if you have children. If you pass away without a will, the state is responsible for making many of the decisions about your property and who will take care of your kids.

Superhero children against summer sky background. Kids having fun outdoors. Boy and girl playing. Success and winner concept

Putting together your own will after sitting down with an estate planning lawyer gives you more of a say about the property that you will leave behind to your kids and who is appointed to take care of them. There are five primary reasons you need to consider using a will in your estate planning. These include:

  • A will enables you to name a guardian for your minor children if something were to happen to you or to you and your partner. This opinion can be extremely important if there are differing opinions in your family about who the guardian should be.
  • A will allows you to name a guardian for the finances of the children. A person will also have to be appointed to take care of your children’s finances if you pass away.
  • You can decide who will wrap up your estate and serve as an executor.
  • You can use your will to set up long term management for the property that you pass on to your children.
  • A will determines who will receive what and who should get nothing. If you have specific wishes about how your property is to be passed on to your children, a will is the most appropriate way to do this.

Your executor will have to make judgment calls about certain types of your property but hiring an experienced estate planning lawyer can help you to address many of these questions and concerns promptly.    

Billionaires Are Living Longer: What Does This Mean for Estate Planning?

May 1, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Tom Benson passed away in 2018 at age 90. He left behind a significant empire that included multiple car dealerships and two professional sports teams out of New Orleans. Sadly, however, many of the last years of his life were spent with his heirs arguing over who is entitled to receive what. The legal battle was sparked by claims that Benson was not mentally competent when he made significant changes to his existing estate plans.

venality businessman or banker in black costume throw open one’s shirt packed heap gold money

Two of his grandchildren and his daughter argued that he was acting under the guidance of his third wife. The claims were rejected and the Louisiana court agreed. This kind of complicated battle could face a growing number of people established as billionaires in the United States. At least 15 billionaires passed away in 2018, leaving a collective amount of assets of $60 billion behind. This could come with complicated asset nature such as sports teams, properties, business interests, planes, yachts, and more. The number of US billionaires has grown as of late, and the rich are living longer than ever, adding further years of asset accumulation. The fight over an estate can prove especially difficult for loved ones who wish to grieve and move on from the loss of a family member. Scheduling a consultation with an estate planning attorney can help you identify some of the points of conflict that could emerge in your estate plan.       

Did You Do Your Part for April’s Financial Literacy Month?

April 29, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

According to Schwab’s 2017 Modern Wealth Survey, plenty of people are simply uncomfortable talking about their finances with their family and friends. However, if any of these people play an important role such as personal representative, executor, trustee or beneficiary in your own estate plan, it could be a big mistake to skip out on these important topics.

According to the study, nearly 60% of Americans would rather discuss politics with their friends and family than finances. Starting the conversation about money with your entire family could help to lay the ground work in the event that any of them play a role in your financial future.

Many children report wishing after their parents have passed away that they would have known more about their parents’ intended estate plans so that they could effectively honor the loved one’s wishes or understand the decision process that got their family member to that point.

But many people skip over the process of talking about financial matters, keeping beneficiaries and other key stakeholders in the dark. As retirement planning and estate planning become more immediate financial concerns as you get older, it could be beneficial to discuss your estate planning options and plans with your loved ones, family and friends. Talking with your estate planning attorney can help to get this conversation going and assist you with understanding some of the best ways to approach this topic.         

Will Deferring My Social Security Payments Really Make A Difference?

April 24, 2019

Filed under: Estate Planning — Neel Shah @ 11:12 am

Research shows that people who have average health and moderate levels of wealth will be better off deferring their Social Security benefits until age 70, when they can. However, approximately 90% of those who are eligible to get those benefits, claim them before the full benefit age of 67.

Of course there are many different reasons why you might choose to take Social Security early, including limited financial resources, considerations having to do with a spouse, poor health or even concern about the possibility of social security’s general survival. However, many people are not fully optimizing this decision and setting themselves up for success with their financial future in retirement. Academic research suggests that psychology could be behind why so many people are electing their Social Security benefits early.

This involves the human preference to take an immediate reward over a future one. Deciding what other aspects you could use or tap into as you get older could be an important component of deciding when it makes sense to take Social Security. Sitting down and calculating out the various resources to pull from in your older years could help you make an informed decision about what is truly best for you.      

You Do Have an Estate!

April 23, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Many people are under the impression that if they do not have significant assets that meet the estate tax laws in their country that they do not have an estate. But no person is exempt from having a complicated, large or even messy estate. Even people who assume that they have very little still have a home, digital accounts, possessions, a car, bank accounts and important sentimental items. Unfortunately, with a busy day to day life, it can easily seem like estate planning is not a top priority but you still must make one to make things easier for your heirs.

Business person standing near a blank billboard

Some of the most important things you can do to begin the estate planning process are to review the people who you’ve already named to carry out specific duties and to review the names of those people who will receive benefits if something were to happen to you. Any key decisions you’ve made in the past regarding your estate planning could even include listing beneficiaries on retirement plan accounts or life insurance policies. These have significant potential consequences for the future.

Your estate plan can also benefit from regular and routine maintenance accomplished by sitting down with a knowledgeable estate planning lawyer to discuss whether or not changes in your life should prompt you to update materials and documents that are no longer in line with your family situation or your goals.     

Solving the Password Problem with Digital Estate Planning

April 22, 2019

Filed under: Estate Planning — Neel Shah @ 12:59 pm

In the digital stage, estate administration requires going one step further and ensuring that you have an appropriate strategy to share the passwords to your email and online accounts as well as your computer. Things can get complicated for your personal representative, estate executor or family members if you haven’t thought this process through.

cryptocurrency. bitcoin with us dollars and calculator

Many people today receive financial statements electronically. Increasingly, plenty of people have dozens of online accounts as well and many of these have different passwords in order to decrease the chances of identity theft or being hacked. Having online access to investments and other financial details is a convenience of living in the modern age.

However, many of these sites now require complex and comprehensive passwords to access these online details. This can create unintended consequences and difficulties for an executor who must be able to gain access to each individual account in order to distribute those assets to trustees or heirs based on the language listed in the decedent’s will.

This even played out recently in a news story when the CEO of a Canadian cryptocurrency exchange passed away suddenly without having ever shared the password to the cold storage locker for that exchange. This meant that the nearly $200 million in crypto currency assets were completely inaccessible and investors might never be able to see those funds again. Sharing your passwords and documenting them in a safe and secure manner is an important component of the estate planning process.     

Are Baby Boomers Overconfident About Long Term Care Planning?

April 17, 2019

Filed under: Estate Planning — Neel Shah @ 1:13 pm

Too many baby boomers have looked ahead to plan for their retirement but have neglected how long term care expenses could influence their ability to have a comfortable life after their working years.

A recent Banker’s Life study found that 74% of baby boomers felt confident in their ability to handle future health care costs, and yet the government estimates that the average cost of long-term care for a retiree in total is $138,000. Up to 80% of respondents in that same Banker’s Life study said they had no money set aside for the retirement health care needs.

For those who did have long term care savings earmarked, the median amount was just $40,000. While most people are familiar with the person who has needed long term care in retirement, and many know that they cannot count on family members or friends for around the clock care, this raises the question of whether or not baby boomers are overconfident.

The misplaced confidence that baby boomers have about their health care costs has led to many of them investing more in estate planning rather than long term care planning. Just one-third of survey respondents had less than a $1000 set aside for emergencies and half of the respondents had less than $5000 in their emergency fund.

The overwhelming confidence that baby boomers have in their ability to plan for the future could be misplaced and could expose them to serious risks in the future. Schedule a consultation with an estate planning and long term care planning lawyer to learn more about how strategies and tools can help to protect you.

Could Last-Minute Will Changes or Death Bed Gifts Cause Problems for Your Heirs?

April 16, 2019

Filed under: Estate Planning — Neel Shah @ 9:17 am

The themes of making a last minute change to your will or changing a gift on your death bed might seem interesting or a great storyline for a movie, but these can cause many more families to end up in a state litigation which could potentially decimate the value of your overall estate you intended to pass on to heirs.

Young pair quarrel in park

Incorporating plans at the last minute might be a necessity because your circumstances could have changed significantly in that period of time. However, if you fail to properly explain or carry out these estate planning changes, your loved ones could end up in court, battling over the validity of your will.

These problems won’t be ones that you’ll be around to deal with, but extended litigation could mean that your estate administrator ends up probating and dealing with many of challenges of these problems, while draining the value of your overall estate.

It’s a much better idea to schedule regular consultations with your estate planning attorney in which you can discuss potential issues and decide what is most appropriate for your individual situation. On an annual basis or as regular changes in your life occur, you can sit down with your estate planning lawyer and walk through what to anticipate and how to approach this process by making updates that will reduce the chances of estate planning litigation.

What to Remember When Selecting a Minor’s Guardian

April 15, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

A major concern for parents of minor children is who will be appointed in the will to take care of the child if the parents pass away. If both of the parents play a relatively equal role in raising the child together, whether it is through the participation of both, or in the case of divorce or separation, individual time with each parent for the child. Your will is the best way to plan ahead for this potential situation.

NJ-estate-planning-lawyer

The primary concern for both active parents is what happens if both of them were to pass away. In situations in which only one parent is active, it is equally important to ensure that an individual is named in the will so that the child is well cared for.

Major issues associated with who will raise the child and who is responsible for supervising property left to the child come up in the estate planning conversation and process you discuss with an attorney.

Make sure you think about the person who is the best choice to serve in this role, someone who is comfortable serving in the job, and whether or not there are any potential conflicts that could emerge in this or other situations.

Estate planning is often complicated and can heighten emotions and increase the potential for conflict if you have not chosen the person who is comfortable serving in this role because he or she does not understand all of the true implications of what is being asked of them.

Did You Recently Move? You Need to Update Your Estate Planning Documents

April 10, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

If you recently moved to a new location from a different state, you need to make sure that your estate planning documents have been updated to show law controls in your new location.

Couple reading map while leaning on car hood during road trip

An attorney can assist you with putting together an amendment to your living and revocable trust that applies to your new state’s law. Furthermore, your will might need to be updated to reflect applicable requirements in your new state. Since you already need to schedule a consultation with an experienced estate planning attorney to update your existing materials, consider putting together a power of attorney for financial matters and a power of attorney for medical matters that are in compliance with the new state’s law. Taking these simple steps is something that you shouldn’t avoid or put off after you’ve moved to a new state. Making these changes can avoid a lot of trouble, time or confusion in the future. Your documents should also be evaluated at this point in time to see whether or not they reflect your goals and desires. If you need to make any updates to executors or trustees because of your new location, consider speaking with your attorney about these options. Whoever is selected to serve in the role as an executor or a trustee should be familiar with the responsibilities required. Leaving behind an additional letter of instructions for anyone who will be serving in this role can give you some peace of mind that your individual instructions will be followed carefully. Schedule a time now to sit down with an estate planning lawyer to talk about necessary updates.      

[End of transcript]

Estate Planning Cannot Neglect Cost of Nursing Home Care

April 8, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

The cost of nursing home care can be catastrophic for someone who has saved ahead for their retirement. A long term care insurance policy could be one important component of saving ahead for the potential of long term care expenses. Being diagnosed with a physical or cognitive issue might mean that a family member or even you requires assistance from someone outside of the family.

Senior man with remote control

Nobody wants to envision spending their golden years in a nursing home and yet more than 50% of Americans between the ages of 57 and 61 will be inside a nursing home at least once in their lifetime. That’s according to a 2017 study completed by the Rand Corporation. The cost of living in a nursing home, however, could decimate your retirement savings. For example, the median cost of a semi private room inside a nursing was over $7,400 per month in 2018. Long term care expenses could add up quickly, particularly in the event of a sudden emergency or severe problem with a loved one’s health. Scheduling a consultation with an estate planning attorney can help open your eyes to the various tools and strategies available to you in the process of planning for your retirement and your future.      

[End of transcript]

Up to 25% of Long Term Care Insurance Claims Start and End in Assisted Living

April 6, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Do you have a plan to protect yourself from the costly expenses of long term care? Far too many people avoid making a goal of protecting their assets from being decimated by long term care.

Most people might assume that long term care expenses only arise in a nursing home situation but a recent study found that nearly one-quarter of private long term care insurance claims started in assisted living in 2018 and nearly 27% ended there, according to the American Association for Long Term Care Insurance.

This reflects some of the most common trends for private people using long term care insurance. Many people start care in a specific setting, such as in their home, and these claims can end to an exhaustion of policy benefits for recovery or death.

In 2018, just over 72% of all long term care insurance claims ended in assisted living due to death, whereas 13.5% of claims ended due to benefits exhaustion and another 14% ended due to recovery. Many people have misconceptions about long term care insurance and might not be clear about how to plan ahead by incorporating this into their estate and retirement plan. Schedule a time to sit down with your experienced estate planning attorney to learn more.      

What Are the Duties of a Trustee After the Grantor Passes Away?

April 4, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

There are both practical and legal responsibilities linked to a trustee when the grantor passes away.

Professional business team working together at office desk discussing during a meeting, efficiency and teamwork concept

These include:

  • Locating and reviewing all of the important papers of the deceased. These items should be found as soon as possible.
  • Change the locks and take any steps necessary to close out and protect the house.
  • Notify insurance carriers that the house will remain vacant.
  • Verify that property insurance and auto-insurance policies are active such that various trust assets are insured against liability or loss.
  • Get the certified copies of the death certificate from the village clerk, town clerk, or funeral director.
  • Make a list of all the household goods that are included in the house to be distributed to beneficiaries. Photographing personal property can make this process easier.
  • Create an exhaustive list of all of the assets and establish a baseline value for these assets.
  • Pay any outstanding debts, bills or taxes.
  • If the trust will generate more than $600 in total income from the date of the person passing away until all of the assets inside the trust are distributed, the trustee needs to obtain a tax identification number for the trust.
  • File any claims for IRAs, life insurance and other assets that require individual forms.
  • Create an accounting of all expenses paid and all assets at the date of the death.
  • Keep beneficiaries notified about the status of the case.

If you are curious about how to serve in this role as a trustee, schedule a consultation with an experienced attorney.     

New Jersey Bill Considers Portable IRAs For Retirement Plans

April 3, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

New Jersey may soon join small list of states, including Vermont and Oregon, that enable employees to take their retirement plans with them if they change jobs. These are known as portable IRAs.

Those employees who work for businesses that have 25 or more employees would automatically be enrolled in a retirement plan managed by a professional unless they chose to opt out if a proposed bill is accepted. In New Jersey this bill is S-2891, which would effectively create the secure choice for retirement program.

This would enable those workers who did not have an employer sponsored retirement plan to be able to save on their own for retirement. According to AARP research, over 1.7 million people living in New Jersey have no vehicle to save for retirement at their jobs.

Planning ahead for retirement is also important because you must consider the possibility of the cost of long term care. Health care costs for the elderly can be significant particularly if the person develops a disabling or incapacitating condition. Schedule a consultation with an estate planning attorney to learn more about how your retirement plan and your estate plan can work together.   

How to Avoid Tax Consequences While Leaving Behind An IRA

April 1, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

It may have been in the best of intentions that you decided to leave an IRA behind to a loved one but this can generate unintended tax problems for the beneficiary. Naming a trust as a beneficiary of your IRA instead can help to protect heirs who are disabled, vulnerable to creditors or who are minors.

Failing to appropriately structure your trust, however, could accelerate IRA liquidation, which could cause significant problems for taxable distribution. Trusts only need to have $12,750 in 2019 to be subject to the top tax rate of the 37%.

When it comes to naming a beneficiary for your retirement account, it’s well worth scheduling a consultation with an estate planning lawyer. By using a trust as your IRA beneficiary, this still enables you as the owner to have some element of control. However, not every IRA custodian will enable you to list the trust on your beneficiary form. Furthermore, this can be complicated by the tax code. There are specific conditions for trusts that are serving as beneficiaries for retirement accounts. Failure to follow through on these rules properly could lead to an accelerated distribution of the IRA assets and significant taxes.

This is why it is recommended that you partner directly with an experienced estate planning lawyer who is very familiar with establishing a trust as the beneficiary of an IRA to avoid consequences to protect your underlying goal of passing on assets to your loved ones.      

Is It Safe to Use A Template for A Last Will and Testament?

March 27, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Deciding to plan ahead for the future often begins with using a last will and testament, but a simple internet search might make it seem as though all you need to do is print out a form, fill it out, and file it away.

A blank last will and testament form with a pen laying over it.

This has numerous potential pitfalls, including the fact that the template may not be accurate for your individual state or needs and this fails to include the possibility that you might need to update your estate plan in the future based on changing circumstances in your individual life.

Because of all of these issues, it’s important to schedule a consultation with an estate planning lawyer who is familiar with how to craft a proper will and testament, and to continue to keep it updated over the duration of your life for your individual needs. Of course, one of the biggest reasons that people will consider using their own last will and testament template is because of the cost. It is certainly the truth that it will be more expensive to hire an attorney to put together your last will and testament for you. However, this money goes a long way in giving you peace of mind.

Those who believe that simplicity is the name of the game in their estate plan might turn to these templates as a meaningful way to pass on their assets to future generations. However, if there’s any complexity in your estate plan, or you require customization, it’s far better to partner directly with an estate planning attorney. Many of these templates are not updated for your individual state and fail to incorporate updates in state and federal tax laws.

 This makes it even more important to retain the services of an estate planning lawyer you can trust.      

Unequal Gifting More Common, Study Says

March 26, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Increasingly, clients are turning to estate planning lawyers to help with the process of gifting unequal shares or assets to their children. There are several different reasons why a parent today might look to outline these kinds of specifics in an estate plan, but it’s also happening at the same time when family conflict poses the biggest threat to a successful plan. 

Portrait Of Frustrated Couple Sitting On Couch Quarreling With Each Other

The study, from Merrill Lynch, found that parents who have more than one child are at least considering leaving unequal shares. According to that study, two-thirds of Americans believe that an uneven split is likely more in line with current family dynamics. 

Sometimes it’s the concern about a child’s spouse and how those assets could be affected through a divorce. In other cases, the parent believes that one child is a spendthrift and the other is more responsible. With a family business or cherished family home, geographic location and desire might factor into the decision, too. 

An unequal inheritance can raise red flags, depending on how or if the parent communicates their intentions. For example, another study found that when it came to siblings who argued over money in their adult lives, over 70% of the time the root cause was the way that an inheritance was divided. Those children who did not receive what they felt were equal shares have chimed in with other research projects about how unfair it was. 

You have to choose a model that works to address your concerns and goals for your assets and your loved ones. In this case, fair does not always mean equal. 

If you’re trying to decide what’s right for your family, talking to an attorney can help you to clarify some of your individual goals in the estate planning process. No matter how you want to split up your assets, tactics in an estate planning and asset protection planning toolkit can become an important component of defining your legacy. 

Is Family Conflict Blocking Your Estate Planning?

March 25, 2019

Filed under: Estate Planning — Neel Shah @ 9:15 am

Market volatility and the possibility of further estate tax reform all have many estate planning advisers prepared for sudden shifts in strategies, but those aren’t even the issues at the top of the list for most American families.


Young Afro-American family fighting in kitchen because of an affair. Man in glasses holding mobile phone, pointing finger at screen, trying to explain himself for love messages from unknown woman

In fact, a new TD Wealth study confirmed last year’s findings that family conflict is the biggest impediment to successful estate planning. More than 100 respondents were included in that study, many of them professionals in the retirement, estate, and investment world.

More than half of respondents in the study said that trying to navigate current family dynamics and possible future dynamics was a major challenge that required new tools and top tier communication.

The challenges of blended families and loved ones who failed to communicate their plan to the other family members are some of the biggest challenges still faced in estate planning.

Even when a person pulls together a comprehensive plan to address their assets and to protect their family, figuring out who gets what and whether that should be communicated to everyone are common concerns.

Telling loved ones about an estate plan could even spark further controversy for those family members who feel left out or who don’t understand the reasoning behind the planner’s approach.

Are You Looking at Retirement Planning Backwards?

March 19, 2019

Filed under: Estate Planning — Neel Shah @ 1:30 pm

Retirement planning and estate planning should work hand in hand, and while plenty of people have admitted in recent studies that they don’t have the basic tools of an estate plan such as a will or trust, a 2018 study conducted by Northwestern Mutual found that many Americans feel they have inadequate retirement plans.

Retirement planning and estate planning should work hand in hand, and while plenty of people have admitted in recent studies that they don’t have the basic tools of an estate plan such as a will or trust, a 2018 study conducted by Northwestern Mutual found that many Americans feel they have inadequate retirement plans.

In fact, 70% of respondents said that they felt they hadn’t done enough for planning for their retirement. To avoid falling in the trap of getting into financial difficulty too close to your retirement age, choose to plan backwards instead. Many people plan backwards to accommodate their individual situations and lifestyles. This starts by considering the amount of annual income you might need during your retirement. Then you will want to decide what kind of life you hope to achieve in retirement and what kind of price tag might be associated with it. Since this answer will be unique for everyone, it’s important to come up with your own solution and to plan backward. Some people want to spend time at home with loved ones and helping to raise grandchildren, whereas others would be focused on travelling extensively. Think about the possible costs of all these social activities and hobbies, and don’t forget about the possibility of a high price tag that can come from long term care and health events that occur later in life. Having appropriate planning done well in advance can help you to enjoy a retirement as you intended but failing to incorporate health care planning such as ways to pay for it, Medicaid planning options and having powers of attorney to enable another person to step in and make decisions on your behalf could all compromise your ability to be successful.     

[End of transcript]

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