How Is an Estate Guardian Different from a Minor Guardian?

In the event of incapacity or death, you probably have estate planning strategies in place to help you and your loved ones adjust. Many people think about the estate planning process as the process of planning for people. You are planning for the people that you leave behind, and some of the most important people to think about are your children.

This means thinking carefully about whether or not you need a minor guardian. If you and the other surviving parent are no longer able to care for your child because of a sudden accident or death, that child will still need a guardian and you have the ability to name the person you want to serve as guardian through the court. There are two different types of guardians to evaluate as part of your estate planning. The first is the guardian of the person and the second is the guardian of the estate. The personal guardian is the individual who is responsible for taking care of day to day needs like shelter, clothing, food and medical care. The guardian of the estate, however, is responsible for managing the property and the money of the person who needs a guardian.

These individual roles are very important and should be evaluated carefully with you and the other parent should you both be on the same page about what will happen to your child. Having these conversations now is not easy but can be important to reduce the stress and frustration in the future. Do not hesitate to get help from an experienced and knowledgeable lawyer right now.


Tuning Out the Noise

For investors, it can be easy to feel overwhelmed by the relentless stream of news about markets. Being bombarded with data and headlines presented as affecting your financial well-being can evoke strong emotional responses from even the most experienced investors. Headlines from the so-called lost decade– the 2000s, when the S&P 500 ended below where it
began–can help illustrate several periods that may have led market participants to question their approach.

*March 2000:
Nasdaq Stock Exchange Index Reaches an All-Time High of 5048*April 2000:
In Less Than a Month, Nearly a Trillion Dollars of Stock Value Evaporates*October 2002:
Nasdaq Hits a Bear-Market Low of 1114*September 2005:
Home Prices Post Record Gains*September 2008:
Lehman Files for Bankruptcy, Merrill Is Sold

While these events are more than a decade behind us, they can still serve as an important reminder for investors. For many, feelings of elation or despair can accompany headlines like these. We should remember that markets can be volatile and recognize that, in the moment, doing nothing may feel paralyzing. However, if one had hypothetically invested $10,000 in US stocks
in January 2000 and stayed invested, that would be worth approximately $32,400 at the end of 2019.1

When faced with short-term noise, it is easy to lose sight of the potential long-term benefits of staying invested. While no one has a crystal ball, adopting
a long-term perspective can help change how investors view market volatility and help them look beyond the headlines.

Part of being able to avoid giving in to emotion during periods of uncertainty is having an appropriate asset allocation that is aligned with an investor’s willingness and ability to bear risk. It also helps to remember that if returns were guaranteed, you would not expect to earn a premium. Creating a portfolio investors are comfortable with, understanding that uncertainty is a part of investing, and sticking to a plan may ultimately lead to a better investment experience.

However, as with many aspects of life, we can all benefit from a bit of help in reaching our goals. The best athletes in the world work closely with
a coach to increase their odds of winning, and many successful professionals rely on the assistance of a mentor or career coach to help them manage
the obstacles that arise during a career. Why? They understand that the wisdom of an experienced professional, combined with the discipline to forge ahead during challenging times, can keep them on the right track. The right financial advisor can play this vital role for an investor. A financial advisor can provide the expertise, perspective, and encouragement to keep you focused on your destination and in your seat when it matters most. A survey conducted by Dimensional Fund Advisors found that, along with progress towards their goals, investors place a high value on the sen se of security they receive from their relationship with a financial advisor, as Exhibit 2 shows.

Having a strong relationship with an advisor can help you be better prepared to live your life through the ups and downs of the market. That’s the value of discipline, perspective, and calm. That’s the difference the right financial advisor makes. For a short video on this topic, please see

Sources: Dimensional Fund Advisors LP is an investment advisor registered with the Securities and Exchange Commission.


What to Consider a Safe Withdrawal Rate in Retirement

The concept of a safe withdrawal rate is important for thinking about your retirement. Knowing how much you might need to take each year to adjust for inflation and other unexpected costs will help you avoid financial challenges down the road. How do you know what’s enough to support you possibly for years to come?

The difficulty with determining a safe withdrawal rate is that there are so many factors that can influence what safe looks like for you. For example, the basic recommendation for retirement withdrawals is to take no more than 4% of the investment total value every year. The primary basis of this that proves problematic is that a retiree’s financial situation needs remain much the same for many years or even decades for this to be a safe approach.

A more cautious approach is to look at a 3% withdrawal rate which gives you a good starting point to consider what’s most important and unique to you. After you have thought about an appropriate withdrawal rate, look back at your portfolio to evaluate your living costs.

Can you make additional changes to your retirement, such as delaying your social security retirement age, continuing to work part time in retirement or reducing your expected retirement expenses? There are many other components that go into thinking about your retirement planning, such as longevity, health care costs, and your estate planning goals. All of these should be completed when thinking about your holistic estate planning and retirement planning strategy.        


If a New Jersey Home Is Sold from a Trust, What Happens to Taxes?

What happens when a home inside a trust is sold?

Someone who serves in the role of trustee is responsible for administration of a trust. Sometimes this can be for a loved one who recently passed away. Knowing what to do in this situation could be very complicated if you were not involved in the original estate planning.

Typically, assets that are transferred into an irrevocable trust will be considered a completed gift and not included in the estate for estate tax purposes, meaning that there would not immediately be a step up in basis for the fair market value of that home based on the death of the deceased. However, irrevocable trusts may be drafted so that the settlor of the trust retains certain powers and rights saying that gifts to the trust are incomplete.

This is why it is so important to understand how to appropriately use a trust in your estate planning strategies. If you are a trustee currently serving in this role, you may also wish to get help from an experienced and knowledgeable probate lawyer.

A probate lawyer can help you navigate the process of closing out estate administration. If you want to avoid these questions and the possible confusion for your loved ones in the future, set aside time to speak with an estate planning lawyer today about creating your own plan.       

What to Know About Your New 401(k) Statement

As part of your retirement plan and your estate plan, there is a good chance that your 401(k) is a big component of your future planning. You’ve spent most of your working life building up your retirement funds and preparing yourself for an estimated retirement age.

A new change coming to your 401(k) quarterly statement will help you make more appropriate plans for how you’ll use these benefits while you are alive and how to consider passing them onto your loved ones later. Sponsors of defined contribution retirement plans like 401(k) will soon include illustration about the lifetime income that you’ll be eligible to receive from your nest egg.

This will show how much income you could possibly receive from your 401(k) when using an annuity every single month. Estimated amounts will use the assumption that your payments would start immediately so take this into consideration as you read these new details. Bear in mind that these general numbers will apply to IRS mortality table lifetime expectancy rates and interest rates based on the current yield from the ten year treasury bond.

The primary purpose of the shift in 401(k) statements is to give participants more information about how their actual account value translates to monthly income. As you make these plans, you might adjust your estate planning strategies. Set aside time to speak with an experienced estate planning lawyer about your options.

Remember when looking ahead to your retirement age that there are many things you can do to support yourself during this time and also leave behind a legacy for your loved ones. As you get closer to retirement, continue to keep a closer eye on your savings strategies and consult with your estate planning law firm about making any necessary changes to meet your goals.


How to Understand the Personal Representative Role

When you complete your estate planning the core document that you’ll likely complete is a will. In this will you will name a personal representative or an executor who is responsible for estate administration when you pass away. The executor or personal representative is an individual responsible for administering your estate and in creating a will you have the ability to name this person.

Bear in mind that the person selected to serve in the role of personal representative, however, can decline it. Your will should name this person and you should also go the extra step of informing them of your intention to name them. If you have already been named the personal representative of someone’s estate and you have questions about your responsibilities, this is a common issue and one that you should broach with an experienced probate lawyer.

By having a conversation with a family or friend that you wish to name as your personal representative, you will make sure that they understand these responsibilities and are comfortable in serving in this way. Far too many family members find themselves in the difficult situation of attempting to navigate probate when they never anticipated being in this position.

When naming a personal representative you should also think carefully about some of the other issues to address in your estate plan, such as naming a guardian for any minor children or whether or not you intend to make gifts to charity. The establishment of a trust can help to support the will that you create as well. Do not hesitate to get help from an experienced and knowledgeable lawyer when you need to create your estate plan.


Why Planning for Partners is Important Even if You Are Unmarried

Estate planning is a process that should be devised with the help of an estate planning attorney to be aligned with your individual needs. Every person has their own unique situation that should be evaluated as part of the estate planning process and of course, the priorities and strategies may look different for a married couple versus an unmarried person.

The laws are not the same for unmarried partners in the event of a break up or the death of the other partner. With appropriate planning in place guided by an estate planning lawyer, unmarried partners can put documents in place to support their intents for key issues like property division. A cohabitation agreement, for example, might address how the assets will be managed during the relationship but also in the event of one partner’s death.

These common priorities can be addressed even if you are not married. Even if you intend to get engaged and ultimately married to the same person it’s important to think about how you could accidentally expose you or them to unnecessary problems in court by failing to put together their estate plan. For example, waiting until you get married could leave you exposed for the entire length of your engagement. If something happens to you or your partner during this time, when documents like a durable power of attorney or a will could have proved helpful, this can add unnecessary stress and problems to an already difficult time.


Is Probate Required in the State of New Jersey?

There are three clear exceptions to when probate is not required but for the vast majority of estates, probate will be required. Probate is the formal process for closing out the administration of a person’s estate and involves paying their final debts and distributing any remaining assets to their heirs. Is-NJ-probate required

Even in cases in which the decedent did not leave clear instructions about the transfer of their assets in a will, probate must still be opened to account for the formal administration issues. As mentioned above there are three specific circumstances when probate is not required. First of all, specific assets that might not require court supervision because they transfer automatically at death are not included in the probated estate.

Consider life insurance policies and retirement accounts that have stated beneficiaries great examples of this. In some rare occasions, probate might not be required for certain estates that fall below a certain economic threshold which eliminates the need for any core supervision.

Finally, if the deceased individual created a living trust for the purposes of estate planning which held assets that belonged to them, only those assets that are included in the living trust do not transfer through the probate process. Probate could still be required in this situation but not for those assets that were properly titled into the living trust. For more information about the New Jersey probate process, set aside time to speak with an experienced lawyer.

What You Need to Know About Charitable Giving in 2021

As part of your estate plan, you likely want to provide for your beneficiaries like your surviving children and spouse. However, research shows that more people than ever are also including charitable giving in their estate planning strategy.

In 2020, for example, individual charitable gifts totaled over $324 billion. This was the highest dollar amount to date. If you believe that philanthropic values are not just important to you but important to your entire family, allocating some of the funds in your estate to support charity can help you provide an ongoing legacy. Your family can also benefit from being brought into this process to introduce the concept of charitable giving to children now.

To start this, meet as a family to discuss how funds could be donated based on the collective values that you share. As you go through the estate planning process, remember to keep other family members involved as needed, such as telling adult children the location of your primary documents for estate planning. You might also use this opportunity to tell your children more about the organizations that you intend to support financially during your life and after you pass away. Finally, meet with your estate planning attorney to discuss how to designate funds to be given to charity in your will. You are not limited to only making gifts to charity at your death but this can be an excellent way to provide for a long lasting legacy.

What Is the Difference Between a Family Trust and a Will?

Wills and trusts are two very different types of controlling and distributing your assets after you’ve passed away. One important distinction between a trust and a will is that you can also create and fund a trust while you are alive. With no will in place the state determines what happens to your estate and everything that you owned while you were alive.

This is known as the rules of intestate succession and it might not match your individual preferences for the transfer of your estate. A will allows you to specify who you want your assets to go to. Trusts allow the person creating the trust, also known as the grantor, to do mostly whatever they want with assets with some limitations. The primary benefits of doing this are that a trust avoids the probate process.

Generally speaking trusts can be used for any family and amount of wealth but are very popular with those individuals and families who have greater than $2 million in assets so that they are able to keep the matters of their estate private. For more information about creating your own estate plan, now is the perfect time to review whether or not your plan is in line with state and federal laws and to meet with an accomplished estate planning attorney to discuss your next steps.

When Does It Make Sense to Use a Family Trust?

A family trust is most appropriate as an estate planning tool when you live in a state where probate is very difficult. This is also beneficial for those people who are interested in keeping information about their assets and beneficiaries private, those who have a large estate or a significant number of assets and those who want to provide for the management of their assets in the event that they become incapacitated.

There are several other types of situations in which a family trust might be the appropriate thing to create with the support of an estate planning attorney. These include:

  • For divorce and creditor protection of those assets to be distributed to a beneficiary.
  • To help provide for disabled beneficiaries who still need to qualify for government benefits.
  • For the time efficiency and cost reduction benefits over the traditional probate process.
  • For tax planning options when the estate size is big enough to incur significant federal or state taxes.

A family trust can also be used in conjunction with other estate planning strategies like a will. Every person and adult family member should have a will but they leave plenty to be desired if you have a more complicated family or estate situation.

When you are looking to plan for minor children, for example, a will is a preferred estate planning tool since you can name a guardian to step in and take care of your children if something were to happen to you. Make sure that you have consulted with an experienced and knowledgeable estate planning lawyer for more information on how to align this with your needs.


What Kinds of Things Can My Financial Power of Attorney Agent Do?

If you’ve already taken the step to consider creating a financial power of attorney, congratulations. This is an important part of your estate plan and your incapacity plan. Without a financial power of attorney someone in your family will have to go to court to request guardianship or conservatorship of you.

In the event of an emergency, which is likely what triggered the need for a financial power of attorney in the first place, you do not want any added delays or frustrations for your loved ones. Creating a financial power of attorney names you as the principal of the document and another party that you choose as the agent. The agent is responsible for acting on your behalf if and when you need him or her to do so.

There are a variety of different kinds of tasks that a financial power of attorney agent can do, including:

  • Collect debts belonging to the principal
  • Manage the principal’s property
  • File taxes on behalf of the principal
  • Assess the principal’s financial accounts to pay for housing needs, health care and other expenses
  • Apply for public benefits for that principal

Without any limitations in the document, a general power of attorney gives the agent broad discretion over financial decisions but there are a few things that the agent cannot do, such as break their fiduciary duty, change the principal’s will or transfer the power of attorney to someone else. It’s extremely important to select the right person to serve as your power of attorney agent. Do not wait to get help. Contact an experienced attorney today to learn more.


How to Choose a Life Insurance Beneficiary

One important component of protecting your family is thinking about how to use life insurance beneficiaries. Beneficiaries are those people who are entitled to receive your assets if and when something happens to you. The primary purpose of purchasing a life insurance policy is to protect your loved ones and give them funds they can use immediately when you pass away.

You might name both a primary and a contingent beneficiary to do this but the decision about who to appoint in this role is not always an easy one. Think about why you have life insurance in the first place, which people rely on you financially and would have difficulty paying ongoing bills if you passed away. What family members or other individuals would need financial support that would cover costs associated with your death, such as final burial and funeral expenses. 

If you would like to leave money to a beneficiary of your choice, you might also divide up this death benefit accordingly. Set aside a time to meet with your estate planning lawyer to discuss how your life insurance policy works in connection with or needs to be considered as part of your overall planning strategy. 

A lawyer can help answer many of your most common questions and help you decide who to name as beneficiaries. Life insurance is just part of your estate planning strategy, and it can work entirely separate from or as a complement to your will. When you work with an attorney who has an annual or regular estate planning strategy review, you will be able to discuss updating beneficiaries and making other changes at that time.       


What to Know About Setting Up a College Power of Attorney

Is your new college student headed off to campus this fall? If so, don’t neglect an important part of the prep process: a power of attorney. While you’re loading up on under-the-bed storage bins and notebooks for them, make sure they’ve got a place to keep important paperwork like a power of attorney. Without it, you’re not able to make any decisions for them or get access to their medical records.

Why does this matter? After all, you’re sending your child off to college to begin their life as an adult. Especially with the worldwide pandemic also a factor, but a variety of other medical issues that could pop up, there’s a chance you might need to help your college student and get access to their records.

It’s these kinds of situations that no parent wants to think about, but could become important in the event of an accident or sudden illness. If your child is unable to speak for themselves or simply needs help coordinating their care, a healthcare power of attorney naming you as their agent will make this challenging situation a little easier.

The power of attorney document should state which person or parent has decision-making ability or healthcare access in the event of an emergency. To use a power of attorney, bring the document with you to the hospital or office where it’s needed. It will usually get reviewed by the hospital’s legal department. It can also be smart to have this on file with your child’s healthcare provider at the university, too, so that they’re already advised that this is part of the medical records.

If your child doesn’t have a power of attorney document but you need to create one, we can help you get the process started so that all your bases are covered this upcoming semester.

What is a Life Insurance Beneficiary?

Did you just start a new job or did you recently purchase private life insurance? If so, you probably came across the term “beneficiary” as you filled out this information. This is the person or people who will receive the funds from your policy when you pass away. For most people, there will be a primary beneficiary and contingent beneficiary.

The primary is the person who will receive most or all of the funds. You can choose who you want this person to be. In some policies, you can even use this strategy to help with business planning or replacing a key employee.

Most people, however, own a private policy or one through work that names their spouse or other family member as the primary beneficiary. The secondary beneficiary is the person who will receive the remaining amount of the policy after the primary beneficiary has been paid. The purpose for naming a second person is to allow you to maximize the benefits handled through this process and to support more people when you pass away, but also to ensure that someone receives your policy benefits if the primary beneficiary passes away before you do.

It’s important to do an annual review of your life insurance policy to make sure that you’ve covered all your bases and that you have an up-to-date beneficiary listing.

Are you ready to talk about how your NJ life insurance policy can help you accomplish your estate planning goals and what other aspects you need to consider? This is a good reminder to meet with an NJ estate planning lawyer to discuss life insurance and other important aspects of your planning.

Don’t head into 2022 without thinking about a review of your life insurance policies and their associated beneficiaries. If you need more support in crafting your estate plan, reach out today for more information.

What Are the Biggest Advantages to Hiring a Professional Trustee?

When creating a trust you have the opportunity to name someone else or a corporate entity to serve as a trustee. The trustee needs to administer the terms of the trust. All trusts require some level of administration.

A few of the factors to consider in deciding whether or not a member of your personal life or a professional should be named as the trustee include the complexity of the estate, the recipients of the assets, the assets involved and other variables. A professional trustee is someone who is not the beneficiary of a trust.

This can be an institution or a person hired to manage trusts for one or more beneficiaries. A professional trustee keeps liability in mind, is objective in terms of the management of family dynamics and is skilled. Professional trustees are recommended when the beneficiary is a minor, when a family member is no longer willing or able to serve as a trustee, when there are high value assets inside the trust, when the beneficiary has special needs or a disability or when it is seen to be in the best interests of the beneficiary.

Professional trustees are compensated for the work they do in administering a trust and this can range anywhere from 1% to 3% of the total assets inside the trust. If you are ready to establish your own trust, contact an experienced estate planning lawyer today to learn more.

8 Things a Trustee Might Do

Trustees will be required to do some or all of the following tasks listed below based on the express terms outlined in the trust’s creation. When putting together a trust, you will need to think carefully about who to install in the role of trustee. This person will have important responsibilities in adhering to your terms and in communicating with beneficiaries.

Some people choose to select an attorney or a corporate entity to serve as their trustee to give them an additional bit of confidence in the management of this important estate planning strategy. Some of the tasks and requirements for a trustee include:

  • Acting as a fiduciary and protecting the distribution and investments of the trust at the highest level.
  • Investing assets when necessary if the trust dictates this as a responsibility.
  • Ensuring safety of assets and understanding the terms of the trust.
  • Distributing or administering assets to beneficiaries per the trust terms.
  • Making ongoing decisions about management of provisions of the trust.
  • Keeping track of records to prepare tax related filings and forms.
  • Communicating with beneficiaries to provide statements and account information.
  • Answering questions.

It is also possible that a trustee’s duties can change over time. If you are creating a revocable living trust and naming yourself as the trustee by default, think carefully about who should serve as successor trustee.

Having a lawyer assist you with creating and using a trust will support your overall estate planning. Keep your assets out of probate and get the benefits of privacy associated with your estate administration through a trust.


What Does a Trustee Actually Do?

A trustee is appointed to manage the administration of a trust’s terms. This person also acts as a custodian for the assets held in a trust and is responsible for administering and managing the finances of a trust based on the instructions included in the trust document.

Some of the common responsibilities for a trustee include recording income and expenses, distributing funds to beneficiaries, filing taxes on income that the trust makes and keeping records of any other transactions that occur. In addition to handling these tasks, the trustee also must act within the best interests of the trust. This means someone that you believe has sound financial management ability and can be responsible for handling the trust terms as you have created them.

Furthermore, since the trustee will have a relationship or at least communication with the beneficiaries of the trust, it’s a good idea to choose someone who has excellent communication skills and will be able to handle questions, concerns and potential problems quickly and effectively. A trustee has numerous different responsibilities as part of managing a trust but chief among them is to act in the best interests of the trust and the trust beneficiaries.

This can minimize the possibility of disputes down the line and make things much easier for everyone involved in creating or receiving benefits from the trust. If you would like to learn more about creating your first trust and installing a trustee, contact an experienced estate planning lawyer today.


What is Medicaid Lookback?

Did you know that if you transfer certain assets in periods before applying for Medicaid due to low income that you might have to go through a penalty phase? This is known as the lookback period and is in place to discourage people who are trying to qualify for Medicaid quickly from spending down or giving away all their assets just to meet those grounds.

Bear in mind that knowing about the lookback period and using strategies to prepare to qualify for Medicaid with the help of an estate planning lawyer is both legal and ethical. This can help you protect the assets you’ve worked hard to build over the course of your life without the fear of them getting decimated by an unexpected long term care event.

In New Jersey, that lookback period is five years and that clock starts as soon as the applicant would become eligible for NJ Medicaid. Penalties can apply if the assets was sold for less than fair market value or if it was given as a gift.

Penalties are calculated by looking at the total amount of any gift that falls into that lookback period and then dividing it at $343.85 for each day. That number then means the applicant must wait that many days before applying for Medicaid benefits.

Note that New Jersey regulations can change from one year to another, and one of the best things you can do is to have a comprehensive estate plan and Medicaid plan in place to prevent problems. This means consulting with a knowledgeable NJ Medicaid planning lawyer today. While you might not need Medicaid benefits just yet, knowing how you could qualify in the future is a key part of your elder law strategy.

What Can Go Wrong with a Digital Power of Attorney Download?

Yes, you can find power of attorney documents and templates online, but it is rarely in your best interest to use these in your business. The very intent of a power of attorney is to let the person of your choosing be able to act in the event of an emergency; unfortunately, digital documents don’t always protect you legally here.

The biggest reason to work with a lawyer to create a power of attorney of your own is that you might have unique needs and considerations to weave into the POA. For example, you might want it to state that the document only becomes active in certain circumstances that you define. A generic power of attorney document might not cover you based on the specific circumstances.

A digital download might seem like the easy way to go, but it’s also a way that could expose you to unnecessary problems. Remember that it will be your loved ones attempting to sort this out if you become incapacitated, and the entire reason to have a POA in place is so that your loved ones don’t have to go through additional hurdles in the event of a sudden issue.

If you find a general template or worse, pay for something that you have not had drafted or reviewed by an attorney, some of the problems you might face include:

  •  The document might not be current with regard to allowed statements/format
  • Fails to cover the legal requirements for a POA in your state
  • Is unclear
  • Doesn’t have key authorities inside it
  • Doesn’t align with your personal situation

If your power of attorney document is unclear or leaves room for interpretation, this can lead to challenges in court which will delay your appointed agent from being able to take action quickly.

This can all be easily avoided when you retain an experienced estate planning lawyer to help you create your own document.