How to Minimize Mistakes During the Estate Planning Process

Since estate planning can be complex and should be aligned with your individual and family goals, mistakes can and do happen. All too often these common mistakes are ones that end up being revealed in the midst of a crisis or after the loss of a loved one.

The most common estate planning mistake is having no plan in place at all. Many people fall for the misconception that estate planning is only for those who are extremely wealthy, but estate planning can benefit people of all different estate sizes.

Estate planning, in fact, can be as simple as proper powers of attorney and asset titling and doesn’t need to include sophisticated trusts or other documents if that’s not relevant for you.

However, another common mistake with regard to estate planning is procrastinating when an agreement can’t be made between key parties. This is particularly relevant if a person has recently passed away and established a trust. If the terms of the trust were impacted by a mistake of facts, then the trust can be changed. If an understanding or mistake ever happens, it must be proven by clear and convincing evidence that must be held up in court.

To minimize the possibility of estate planning mistakes, it is in your best interest to schedule a consultation with a trusted estate planning lawyer who can help you craft these documents accurately from the outset or to review the existing documents and make recommendations.           

How to Remain Connected to Your New Jersey Estate Planning Law Office During the Pandemic?

Many law practices including ours have updated procedures, policies, and accessibility to be as helpful to you as ever in light of the need to meet virtually. Here at Shah & Associates, PC., our offices remain 100% staffed and virtual.

We are still here to help you with new estate planning documents as well as updating your estate plan and revising existing documents. We have remote file storage for all of our digital files to maintain top security and use zoom for online meetings.

Furthermore, our entire team has access to scanners, and we will continue to maintain digital portal access for everybody. Additionally, until we are able to meet our clients in person, we have also instituted remote signing procedures for temporary plans.

If you need assistance with temporary plans and want the peace of mind provided with continuing to develop your relationship with Shah & Associates, we are here for you.

We recognize that these are trying and uncertain times, but we are proud to uphold are commitment to doing right by our clients and putting your needs first. Schedule a consultation today over zoom or over the phone by contacting Shah & Associates. We are here to help and will help guide you and your family through these crises.           

Taking Your Time with Estate Planning

Sometimes it’s the loss of a loved one or someone in your family being diagnosed with Alzheimers’ that gives you the sign to put ‘estate planning” at the top of your to-do list. But the truth is that it can be dangerous to rush your planning if you’re doing it on your own. Hiring an estate planning attorney helps you by clarifying what’s really important and having another person to review all the details and give you pointers about what might have been left out.

To start with, an inventory of your assets forms the basis for your future estate planning. What do you have? What do you owe? Do these different kinds of assets mean different things for planning your estate?

A will, a power of attorney, and a medical directive are some of the most important documents you should create right away. There’s a good chance that you already know who- or what- needs to go inside those. But if you need additional support, this is a great opportunity to speak with your estate planning lawyer about what those look like.

Some aspects of your estate plan can be put into place immediately, like your will. Others, like an asset protection plan or a business succession plan, should only be developed with the support of a lawyer and with careful consideration and time. With those plans, the details matter and you should exercise every opportunity to implement the right time to talk through your options.

A lawyer’s review of both the simple and the complex estate planning documents can make a world of difference. Scheduling a virtual or phone meeting with your attorney makes it simple to accomplish this task from the comfort of your own home to get the ball rolling on these key documents and plans.

7 Steps for an Estate Plan Now

Do you have a plan for what will happen to your assets when you pass away? What about who will be able to make decisions on your behalf if you become unable to do so? These are just a few of the questions you’ll need to answer when you put together your estate plan and the support of the right estate planning lawyer can go a long way towards helping you.

For many people, estate planning feels overwhelming. Thankfully, there are a few stages to getting through this phase successfully that can make you feel more accomplished at the end.

Step 1: Look at Everything You Own and Record It

You can’t really know what your estate looks like until you inventory it. This makes the future planning steps much easier since you can decide what kind of strategies are best suited to your needs.

Step 2: Consult an Attorney

A lawyer can help you figure out what support you need in the form of documents and tools like trusts, and having your inventory already pulled together will make that process easier.

Step 3: Create a Will

Often the cornerstone of an estate plan, your will can name a guardian for a minor child and a basic distribution plan for assets.

Step 4: Check Beneficiary Forms

From your life insurance policy to your retirement accounts, there are some items that pass outside of will designations. Verify your forms filed with these companies are up to date.

Step 5: Evaluate Life Insurance Policies

Do you have enough coverage? A plan for protecting your family and loved ones while probate is pending? This is a good time to chat with your life agent.

Step 6: Form a Trust

You might benefit from one of the most powerful and popular estate planning tools in the form of a trust. Discuss which kind of estate planning trust is right for you.

Step 7: Consider Healthcare Options

Discuss considerations like qualifying for Medicaid and a healthcare power of attorney to ensure you have plans in place if you were to become ill and need additional support.

In your first estate planning meeting, your attorney can help you decide what aligns with your individual needs.

Yes, Even College Students Can Benefit from Estate Planning

People of all ages have the potential to recognize the possible benefits of estate planning but one that is often overlooked is when parents send their new 18-year olds off to college campuses in the fall without completing the appropriate estate planning steps.

A great time to think about estate planning is now as many students are nearing graduation and will be spending the summer getting ready for their new college experience. It can be difficult for parents to understand that legally children now have the ability to make decisions for themselves and that parents are not automatically opted in to health care and important medical decisions once the child has reached age 18. It’s a good opportunity to have an estate planning conversation with your teenager while he or she still lives at home.

These documents, like advanced directives, name people who are capable of making financial, medical, business and legal decisions in the event of incapacity. This means that people of all ages can use these tools to their benefit. If a child age 18 or older is injured in an accident or falls ill and is no longer able to communicate on their own or make decisions for themselves, the primary risk is a need for guardianship hearing to appoint another person. Usually as a parent, you would need to hire an attorney to file a petition with the court, asking for the judge to formally appoint the parent as the child’s legal guardian.

In emergency situations, the opportunity to do this can seem overwhelming and can add further delays unnecessarily. A power of attorney, however, enables a parent to make business, financial, and legal decisions on behalf of the child if and when that document needs to be exercised. Schedule a consultation with an estate planning attorney today to discuss this option.         

Estate Planning & Your Home Title

There have been many commercials and some news stories about people having their homes stolen. The narrative in these stories typically goes that a thief finds the title to your home by locating it online or hacking into it. According to this story, the thief then steals the title, forges documents, and end up owning your home, either having you evicted or mortgaging it.

This is a problem known as title theft, and multiple companies have recently emerged onto the landscape promising to help people by monitoring the title. In order for a thief to be able to accomplish this, they would need to find the title to your home online. In certain states, recorded documents like deeds are a matter of public record, and many counties have this information online.

A new deed could be forged when someone finds this information and then could be used to steal your home. However, a forged deed doesn’t necessarily convey the title to the home, but it could cloud the title on home making it problematic for you to pass it on to your loved ones in the future.

In most cases the state will require additional forms and filings to accompany a transfer of a title, and there’s plenty of information that must be submitted on these forms in order for it to be readily available for someone who is attempting to steal the title. Before passing on a piece of real property, it is important to understand how titling issues can impact transfer.

Schedule a consultation with an experienced estate planning attorney to discuss all of the different ways that you can protect your home and ensure a smooth transfer of it in the future.       

Are You Subject to The Estate Planning Minefield? Beneficiary Designations Should Not Be Overlooked

You probably had no idea about just how many things can go wrong by listing the wrong person or a person who should no longer have this authority on your beneficiary designation forms.

There are some best practices that you can implement in your estate planning instead that could minimize the possibility for unfortunate and uncomfortable situations for your loved ones.

Most people are familiar with the beneficiary designation form, given that they would have come into contact with it when opening a 401(k), an IRA, or completing a life insurance policy application. This form designates who is eligible to receive that asset if the account owner passes away.

Unfortunately, however, many people don’t understand the far-reaching consequences of a piece of paper such as a beneficiary designation form since it overrides other instructions in your estate plan including your will.

These forms can create turmoil, unintended bequests to former spouses and even confusion. Multiple account types are governed by beneficiary designations, such as a annuities, IRAs, life insurance, and 401(k)s. These contractual provisions override your will, meaning that if you have an outdated beneficiary designation form, the person listed on that form is still legally entitled to receive your assets even if you are no longer married to them.

It can be very problematic to fail to update your beneficiary designation forms. Set an annual reminder on your calendar to sit down with your estate planning attorney and discuss beneficiary designation forms and other tools.      

How Many People Don’t Have A Will In 2020?

Every year conducts a study to determine where people’s minds are at with regard to estate planning. There are many different questions asked inside this survey that it typically involves more than 2,400 people.

But one of the most important is to determine who already has an estate plan in place. For middle-aged Americans with a will, the study found that there has been a near 25% decrease for people who have this most important and vital estate planning documents.

In 2017, older and middle-aged Americans who participated in the survey reported that over 40% of middle-aged and older Americans reported that they had a will. But only 32% had that same document as shared in the 2020 survey. This is a significant decrease in the number of people who have critical estate planning documents, like a health directive, a living trust, or a will.

The lack of these important documents can be alarming for any family, since estate planning helps to establish multiple goals. A will is also your opportunity to name a person who will be responsible for caring for your minor children or making decisions about your health if you become incapacitated or are unable to do so. The study also found that for Americans earning more than $75,000, only 45% of them in that category had a will in place.

This is also problematic news given that a sudden incapacitation or death could have big consequences for your family and loved ones.        

Don’t Keep Financial Secrets from Your New Mid-Life Partner

There are many complicated facets of estate planning that arise when marrying someone in mid-life. Keeping financial secrets and refusing to share your financial history with your partner could set you both up for problems in the future.

Furthermore, a mid-life marriage, including a second or third marriage, requires upfront honesty about both of your individual financial situations and how your marriage can impact your estate planning.

One 2020 survey of over 2500 adults in relationships found that nearly half of respondents were hiding a savings, checking or credit card account from their partner. Up to 57% of millennials, 37% of baby boomers, and 45% of GenX-ers had deceived their partners financially. This form of financial infidelity could be very problematic should the other person find out about it and could add to an increasing layer of complexity.

When joining your finances with a mid-life partner, consider a discussion with a CPA and other financial professionals. 

If you already have retirement accounts and estate planning details set up for you personally, this information should be discussed with your new spouse. It’s a different strategy to go from creating all of this information on your own to reflect your individual needs to moving it over to combined finances and estate planning.

Updating all of your key documents, including your beneficiary designation forms, should come at the top of your priority list.

If you’re stuck on how to get started and need more advice, set up a time to speak with a trusted estate planning lawyer who can guide you through which parts of your estate plan need to be updated and how to consider some of the complexities of combining interests and finances in a later-in-life marriage.      

Understanding the Complications of Annuities in An Estate Plan

Do you have an annuity? Is this a financial tool you created for your own future but is something that was ultimately moved out of your possession/estate and into the management of a trust? Read on to learn more about key issues that emerge with trusts owned by annuities.

If you have placed an annuity inside a trust, this can get very confusing regarding the beneficiary designation. You should have a working knowledge of the type of annuity you have selected and how these individual annuities function. Recognize at first that not all annuities are the same.

One of the most important distinction of different types of products is whether or not the annuity has been funded with after tax or pre-taxed dollars. This is basically asking whether or not this is an investment account or a retirement account. An annuity could be part of your IRA investments and any annuity that has been funded with pre-taxed retirement dollars is referred to as a qualified annuity.

With a qualified annuity, ownership should most likely not be transferred to the trust itself. If an annuity is non-qualified; meaning that it has been funded with after tax dollars, there is a strong probability that the annuity should be funded into a trust enabling a successor trustee to exercise control over the annuity in addition to other trust assets. To ensure this is the right course of action for you, schedule a consultation with an estate planning lawyer.       

Why Is Retirement Planning Complicated with A Late Divorce?

Getting divorced late in your marriage, such as several decades in, can create significant complications for a retirement planning. One partner might have saved a lot more than the other with the intention that the savings will be combined later, or the partners might have merged their retirement funds making it difficult to disentangle them upon a divorce.

A divorce can be financially devastating for a person at any age, but this influence is much higher when the partners are approaching retirement because the cost of living alone is considerably higher than when two people are sharing expenses. A 2017 report, completed by the PEW Research Center, shows that divorce rates for those couples over age 50 have nearly doubled since the 1990s; a phenomenon known as grey divorce.

Late divorce gives both parties involved less time to pay off debts, handle the ups and downs in the stock market or recoup any losses. If one or both parties are already retired, there may not be an existing steady source of income to rely on for their complicating matters.

What Should You Do Right After A Loved One Passes Away?

The loss of a loved one can be an emotional and overwhelming experience and it can feel very difficult to understand what you need to do to protect your interests and next steps that you need to take.

Get help from a NJ estate planning lawyer today.

However, there are many important things to contemplate during this difficult time related to your loved one’s finances. Don’t make any decisions too quickly, since some of the choices you make early on could be difficult or even impossible to reverse. After determining your loved one’s final wishes for a funeral and listing an obituary, it is important to find the necessary paperwork to help you with the next steps to managing your loved one’s estate.

Other important paperwork could include titles to cars or deeds to property. You will need to have certified copies of the death certificate in order to accomplish this. Your loved one’s finances should be the next area to tackle.

This includes making a full list of all the debts and assets. Retirement plans, 401(k)s and IRAs are an example of assets. Determine who was listed as a beneficiary on any retirement plans since these assets will passed to the person named and the same follows for life insurance policies. If there was a mortgage on a piece of real estate, it is important to continue making the monthly payment and the same holds for any insurance payments. If there was an automobile or home involved, the insurance coverage should also be continued.

Do you want to include instructions for your loved ones to help with your estate? Speak with an estate planning lawyer today to get started.