As a corporate executive you have plenty of things on your plate and you probably don’t want to think about adding anymore, but there are several critical financial tasks that you can’t afford to neglect.
Even though corporate executives put in a lot of equity to get their money, they tend to devote very little time to managing it. Getting a head start on your financial and estate plan, however, can give you the peace of mind that you have planned for the future and assist you with managing this money in the most effective way.
After all you’re working hard for it and you should be able to plan for
it to pay off dividends for you. Some of the most important steps you can take
the maximum amount available to your 401(k) plan, especially if your company
match is significant.
Make sure that
your wealth isn’t reliant entirely on an employer. Whether you get restricted
stock grants, stock options or a 401(k) match, you want to make sure that you
net worth doesn’t drop if the company stock price takes a dive or if you are no
longer working there.
estate plan. Far too many people who are corporate executives don’t have a will
at all, and for those who do, it’s usually so old that it’s no longer
beneficial to them or their loved ones.
Make sure that you evaluate your will and other estate planning
documents on an annual basis, and if you have put off creating a will up until
now, it’s a great opportunity to schedule an appointment before the end of the
year to cross this important task off your to-do list.
If you’re looking for a plan to save money, elder law planning on your own might seem like an appealing option, even though the advantage could be potentially saving money now.
There are costly mistakes that you can make in the DIY elder law planning process, such as omissions, neglecting opportunities for protection, and errors that end up affecting you or your loved ones.
When it comes to protecting assets from the cost of nursing homes, and naming those people who will make financial, legal, and medical decisions in the event of a disability, it’s important to think about how an attorney can help you draft a legally valid healthcare proxy and power of attorney. There can be significant consequences if you simply find a form online print it out and fill it in.
The power of attorney form in different states could require different considerations, and since you want your elder law plans to be as accurate as possible for your individual state, you need to verify with your attorney that your document is indeed legally valid.
Healthcare proxies and powers of attorney, for example, should also have language that gives the named agent the authority to obtain all documents and medical information under HIPAA, the U. S. federal privacy law.
There’s too much left to chance when you engage in the process of DIY estate planning, and you could remove many of these barriers and hesitations by hiring an experienced and dedicated elder law planning attorney.
The charges for home care are now rising faster than those associated with nursing home care, according to Genworth’s most recent cost of care survey. The median annual cost for home health aides rose 4.55% in 2019, whereas the median cost for a private nursing home room only increased by 1.82% to $102,000.
Getting support, whether it’s in a nursing home or in your own home, can
be extremely costly, particularly if it decimates you and your spouse’s
retirement savings. This study shows that long-term care is becoming
Consulting with an elder law attorney might be the only way for you to
protect some of your personal assets from being used to support a spouse in a
nursing home. A consultation with an elder law attorney can help you understand
the benefits of attempting to qualify for Medicaid using advanced planning
The sooner that you can plan ahead to qualify for Medicaid, the easier
it will be to have options available to you when you move forward with getting
a loved one in a nursing home as soon as possible. An elder law attorney can
help you become more aware of your potential blind spots and help you navigate
the difficulties of preparing for home care or nursing home care.
Your first meeting with a knowledgeable estate planning lawyer lays the groundwork for all of the things you will work together towards in the future. It is important to identify an experienced estate planning lawyer who puts you at ease during this initial interview.
Many attorneys will offer a consultation to discuss some of your
concerns and some of the strategies related to your estate planning. During
this interview, you should not only be asking questions about your individual
situation but screening the attorney to make sure that you are comfortable with
working with him or her.
Complete and accurate information is vital to putting together a
comprehensive estate plan so you should always be honest and upfront with your
estate planning lawyer to ensure that your attorney has all the relevant
information. An estate planning attorney will craft unique strategies aligned
with your individual needs and therefore, it is important to verify that you
have a comprehensive listing of all of your assets prior to attending this
Make sure that you have the opportunity to address your current family structure and any other unique concerns, such as your desire to pass things on to charity or to exclude certain parties from your estate planning. These steps can be instrumental in helping you to outline a full plan for protecting all of your interests and knowing what to expect down the road.
Your estate planning attorney should be well informed about relevant
state and federal laws and be able to guide you through the process of
selecting the tactics and strategies that are most relevant for you. It is
important, however, that you have a personal connection and confidence in your
estate planning lawyer’s abilities, since he or she will be playing an
important role in defining your future.
If you pass away without a will in New Jersey, your assets will be passed on to your closest relatives under laws established by New Jersey for intestate succession. Only assets that would have passed through your will are impacted by New Jersey’s intestate succession laws.
Typically, this includes only assets that you own in your own name alone. It’s important to remember that many different valuable assets do not go through your will and are, therefore, not affected by intestate succession laws.
Common examples include life insurance proceeds, property that was transferred to a living trust, payable on death bank accounts, funds in an IRA, securities held in a transfer on death account, and property on hold in tenancy by the entirety or in joint tenancy.
If you pass away with children but no spouse, your children will inherit everything. If you pass away with a spouse but no descendants or parents, the spouse inherits everything. If you pass away with a spouse and descendants from you and that spouse but that spouse also has descendants from another relationship, your spouse is entitled to inherit 25% of your intestate property.
If you pass away with a spouse and parents, the spouse is entitled to the first 25% of your intestate property so long as this is not less than $50,000 and more than $200,000, plus three-quarters of the balance. The parents would inherit any of the remaining intestate property.
It can be overwhelming to try to figure out this process of deciding who gets what on your own. It’s important to schedule a consultation with a New Jersey intestate succession lawyer to put together an appropriate plan for passing on your assets.
The IRS has authority on the estate tax and gift tax amounts that affect individuals and families and recently announced changes to the estate tax amount for 2020.
If your estate plan requires an update or if you’d like to adjust your giving strategy in 2020, now is the right time to speak with an estate planning lawyer about those options.
The official estate tax exemption has been increased to $11.58 million per person, an increase from the 2019 number of $11.4 million. This means that as a single person, you can leave up to $11.58 million in assets behind for your loved ones without triggering an estate or gift tax.
Couples, as usual, are able to take advantage of each person’s individual amount for a combined total os $23.16 million. The annual gift amount remains the same at $15,000.
When discussing your options with your estate planning lawyer, you might decide that you can use a combination of giving over your life to maximize the gift tax and giving at death with the raised estate tax amount.
With an upcoming presidential election, possible changes to the gift tax amount are front and center for many people. Depending on the outcome to that election and changes made to the program, if they occur, you’ll want to be prepared by having a dedicated estate planning lawyer who can help you figure out how to make it all work together.
No entrepreneur wants to think about a future in which they are not involved in their business without that being their own choice. It’s smart to hope for the best and prepare for the worst but recent studies have shown that far too many entrepreneurs and business owners are hoping and preparing for the best instead.
Research from the National Association of Corporate Directors showed
that two thirds of private and public companies had no formal succession plan
in place for their CEOs. As a business owner you know that proper plans and
structure have a key impact on your ability to thrive.
Since the future is unpredictable, the consequences of failing to
institute a formal succession plan could end up harming your loved ones and
your business. Three tips to make business succession planning easy include:
procrastinate and instead think carefully about other options if it falls on
you to leave the company, such as disability or divorce.
successor for who can step in to provide continuity if you are no longer
involved in the business.
current value of your business, preferably with an objective third party so
that you know where you’re working from and the different stakeholders who
might be involved if you were to step away from the company.
If you already created your own will without the help of an
attorney, it’s still a good idea to have a lawyer review your document to
ensure it’s in line with state laws. While a DIY will might seem like the
easier route to go, the costs associated with making a mistake on a DIY will
can follow your loved ones for many years.
Having the peace of mind of speaking with an attorney gives you the chance to correct anything inside the will that could potentially render it invalid. Furthermore, you can discuss safe places to store your will document after it’s been fully executed.
Your original will should be stored in a safe and fireproof
location. Most people assume that a safety deposit box is the best place to
store critical documents, including your will and even funeral or memorial
instructions. The problem with this approach is if none of your loved ones know
where to find this information or if they can’t get to it in time for it to be
More immediate documents like your desires concerning a
funeral or instructions from the plans you’ve made in advance could be stored
with your estate planning lawyer or a close family member or friend. Someone
else should know where to locate this information should it become necessary.
Your original will should be stored in a safe location as
mentioned above, but you can keep copies elsewhere. Signed copies of the will are
important in the event that the original is destroyed. It’s your job to make
sure that you’ve taken as many proactive steps as possible to make it easier
for your loved ones if you suddenly pass away.
Are you concerned about your assets being exposed to risks? Worried that your personal assets could be tapped through a lawsuit or through a creditor looking to close on a debt?
The best time to begin asset protection planning is long before any of these threats is on the immediate horizon. Every state has laws that protect a judgment creditor making legal efforts to collect if the debtor tries to transfer assets out of their own names in an effort to delay or block a collection attempt.
Courts, therefore, can see right through these moves and would likely classify them as “fraudulent transfers.” With asset protection planning, you must be thinking about options to shield your assets well in advance of any filed suits.
Even waiting until you think that a lawsuit might be filed is too late in most cases. While there might be a few limited steps you can take at that stage, you’re much better off by making an effort to talk with your estate planning lawyer about asset protection planning now.
The purpose of taking these steps when there’s no immediate exposure to a suit is twofold: it helps discourage people who think that you might be an easy target for a lawsuit away from doing so because they recognize that your asset protection efforts will make it harder for them to succeed and it also increases your chances of success in the event a suit is filed.
Most people who put together an asset protection plan hope that they never need to exercise its powers in court. But the peace of mind that this provides can give you confidence going forward that if a potential threat emerges that you have options available to you.
If you’re ready to talk asset protection plan specifics, our office is here to help you craft a customized plan based on your needs. Don’t wait until it’s too late- create your plan today.
Many financial advisors are soon to be aging out of their companies. The average age of today’s financial advisors in the United States is in the mid-50s and plenty of these professionals are moving into their 50s and 60s.
The future fates of these thousands of practices, however, hangs in the balance for those that have not completed succession planning. Studies show that the vast majority of small advisors, particularly those who are handling their firm on a solo basis have no successor or business succession plan set up.
According to recent research studies, solo practitioners who bring in around $250,000 per year in revenue often have no succession plan and the alarming fact that these represent up to 70% of the financial planning industry.
While bigger practices are more likely to have a business succession plan or even a strategy for training future leaders in the company, it is important to sit down with a dedicated business succession planning lawyer and estate planning lawyer to discuss how the future of your business and the future of your personal assets can be reflected together in a comprehensive estate plan.
Your business succession plan is the roadmap for those still in the company to be able to continue operating even after you’re no longer there. Having a backup plan in case this happens can have a big impact on your company’s success.