Did the court recently name you as a personal representative to a loved one’s estate or have you volunteered to serve in this role because there’s no one else in your family or friends circle who can assist with a deceased family member’s estate administration? The process of probate requires that at least one person be responsible for the administration of the loved one’s asset distribution either to creditors or to beneficiaries. This person is known as the personal representative or executor.
As a New Jersey personal representative lawyer can tell you, this process can be involved. A personal representative attorney in your area may be required to handle the most important aspects of probate. In those circumstances, it is strongly recommended that a newly appointed personal representative get help from an experienced attorney. A personal representative lawyer in your area should be someone who has handled probate estates before and someone who can provide insight and support to the personal representative regardless of how long probate takes.
Probate could be as simple as filing some paperwork and distributing what minor assets belong to a loved one over the course of a couple of months but it can also be much more involved, especially if there is a will contest, a trust contest or assets or beneficiaries that are difficult to find. In those circumstances it’s vital to hire an experienced personal representative lawyer to assist with the detailed management and to provide the personal representative with a greater sense of confidence about the order in which they are managing things.
A personal representative has a duty to the beneficiaries of the estate and to the estate itself to handle these important tasks properly. Personal representatives who do not do this could be accused of illegal or unethical behavior and could even be removed from their position. Furthermore they face the risk of being held personally accountable for financial losses sustained by the estate due to their actions. Because of the high stakes involved, it is strongly recommended that you get legal support from a personal representative attorney when handling a loved one’s estate. This is especially important if the estate is complicated.
Funds from the estate can be used to help pay for the attorney’s services and it can make the role of serving as a personal representative much easier because you have a better handle on what to anticipate and some of the common challenges that could pop up. No one should be in the process of handling a loved one’s estate like this on their own and you can do a lot of good for yourself by finding an attorney early.
A trust can be created to help manage asset transfer when you pass away in a streamlined and controlled manner. This prompts the question, should you put your life insurance policy into a trust? Naming a living trust as a beneficiary of your life insurance policy does come with some disadvantages.
The benefits of going this route, however, are that it makes it easier for your loved ones to access this money because they do not have to go through probate and the funds are protected from creditors who might step forward during that probate process to try to claim pieces of the estate.
If you are the trustee of your revokable living trust, any asset inside it is technically considered your property because this trust is not irrevocable. Life insurance proceeds in this example would be counted towards your overall estate work if your estate exceeds the IRS threshold for taxes, which is $12.06 million in 2022 and $24.12 for couples. Additionally, funding a trust with life insurance, much like annuity contracts, typically requires a change of ownership form that is submitted to the issuer of the contract.
Life insurance can be used alongside your estate planning or can play a more active role. Overall, it helps you to give your family immediate assets they can use to pay the most important bills and cover things like a mortgage. Deciding on the right amount of policy coverage is key to success, and you might want to revisit that over time, too.
Before placing a life insurance policy into a living trust, speak with an experienced estate planning lawyer about whether this is recommended for you.
Creating a will online or using a basic template might seem like the easiest route. After all, this is a task many people put off to begin with, and finding a simple template that makes it go much more quickly is very enticing. However, simply filling out an online form is not enough to create a valid will.
This is because every state across the country has their own rules for determining whether or not a will is validly executed. In order to decrease the possibility of someone being forced to or encouraged to sign a will against their direct wishes, these rules help to make sure that a person understands what they are signing, is cognizant of the impacts of the entire process, and is making this decision on their own through valid execution.
In many cases, these rules require that the will be in writing, that it is signed, and it is witnessed by others. Simply printing out a form online, therefore, does not give you the protection that you are looking for.
It can be a good starting place as you begin to contemplate questions that you might have about creating your own estate plan or things you’d like to include in your own will, but it will not cover all of the specific needs that you have. Make sure that you consult with an experienced estate planning lawyer about the questions and concerns that you have for your next steps.
The most targeted group for financial fraud is elderly individuals but studies show that they are also the least concerned about being scammed. Millions of older Americans have worked extremely hard to contribute to their retirement funds and this makes them top targets for financial scams.
A 2021 retirement risk readiness study conducted by Allianz Life indicates that less than one-quarter of retirees are concerned they could become a victim of financial fraud. Financial fraud can have significant implications for someone’s financial security and can undo years or even decades of hard work. One of the most important things that elderly individuals can do is to regularly monitor their financial accounts and to be vary of anyone offering them outright advice or suggestions out of the blue. This can be especially problematic for elderly people who are not as in touch with their financial plans because they were created by a spouse that has since passed away.
Enlisting trusted help from professionals or family members you can rely on is an important part of making yourself aware of potential scams and giving you the opportunity to respond to these effectively if and when they occur. These proactive steps can help minimize the possibility of elder financial abuse and the negative fallout associated with it.
Approaching the new year gives people plenty of opportunities to set resolutions for the 12 months ahead, but a great financial plan and ongoing financial strategy to support your personal goals and your estate plan is about more than a one-time commitment. It’s an ongoing area of focus.
Designate January as a month that you sit down and review your financial goals and your progress towards them each year. This will help you map out smaller goals to take across the course of the year and to adjust your strategy as necessary.
If you haven’t met with your estate planning lawyer in some time, pull out those documents. Are there any changes you need to make or things that no longer align with your personal plans and goals?
Set aside a monthly meeting with yourself to review finances and to make adjustments. This could include things like budgeting, paying down credit cards, paying all of your bills at once, increasing your retirement contributions or meeting with your financial planner. Having regular engagement with your financial and estate plan can make it much more likely that you will achieve your personal goals. This will give you more peace of mind overall and can help you move more closely towards the process of thinking long term about your financial strategies.
Our estate planning office can help you create or update your custom plan to cover all your needs and give you peace of mind about the future. Contact us today for further information and to get started with the process.
A transfer on death bank account is one way to provide assets relatively quickly to your loved ones after you pass away because your passing enables them to get access to these assets immediately.
Most people establish a transfer on death bank account specifically for the purposes of a spouse or a child. However, many beneficiaries of transfer on death accounts can include people beyond a surviving spouse. This can include friends and relatives although there are some states with special rights associated with the surviving spouse.
You need to contact your bank directly to make sure you have the proper form completed with your financial institution. You would also need to return to them if you need to reassign that bank account to someone else. A transfer on death bank account is a better choice than adding someone directly to your bank account since doing the latter would empower that person to do things with your bank account as soon as you add them.
Usually when a transfer on death account agreement directs funds to someone other than the spouse or in addition to the spouse, the spouse might need to give written consent. You will need to read through the specific claim with a transfer on death bank account which you intend to use.
This can be a valuable estate planning tool but certainly should not be the only thing you consider in the process of passing on assets to your loved ones. Make sure that your estate planning lawyer has guided you through the process of considering all possible issues so that you have a comprehensive plan.
When you create a retirement plan, you’ll need to establish beneficiaries for those assets when you pass away. These beneficiary designation forms are handled outside of the rest of your probated estate, meaning that the forms you have on file with your company will be used when you pass away regardless of what it says in your will.
These are used to determine who is entitled to defined contribution retirement plan benefits when the primary participant passes away. Unfortunately, this is often overlooked when the primary planned participant goes through major life changes, such as a divorce or a remarriage. This means that these forms could be outdated.
Typically, the plan sponsor or administrator is responsible for maintaining beneficiary designation forms, however, they may not realize it is their responsibility to keep these up to date when participants enroll electronically.
It is a good idea to put on your own calendar to conduct a thorough review of your estate plan including any beneficiary designations on an annual basis. This way you can make necessary updates as soon as possible and know that you have incorporated any recent changes in your life.
Your retirement plan assets do not pass outside of probate but should still be considered as part of your entire estate plan. Working with a lawyer allows you to go item by item through your estate plan to create a custom strategy for all of your assets. You might wish to equally distribute non-probate assets, for example, among a few family members. Probate assets could wind up tied up in court, so it’s important to think about these issues as you determine who should receive what.
It might initially make sense to you that leaving behind instructions for your loved ones when it comes to your funeral plans with your will is an easy way to keep like-minded papers together. However, in the heat of the moment it is unlikely that your loved ones will be able to find this important information with the short period of time they have to make funeral decisions.
This makes it very important for you to document these plans in advance, or even better, to invest in them and make sure that your loved ones know where to find these details. One of the main reasons this could be a problem for your estate planning purposes is that wills are often not even read or found until days or weeks after a death.
This is too late to be of important help to those family members who must make critical decisions about the disposition of a body as well as scheduling memorial or funeral services. You might want to make a separate document laying out your wishes and whether or not you have made any investments or plans already in your funeral plans.
This will make it easier for your loved ones to get access to this critical information sooner rather than later. You can document more long term and comprehensive estate planning strategies with the help of an experienced and dedicated estate planning lawyer. This will help you avoid many of the most common problems that many people face and allow you to incorporate your individual intentions in a plan for the future.
A transfer on death deed is a powerful tool for real estate planning purposes that allows your chosen beneficiary to receive access to a piece of land or real estate when you pass away without going through probate.
Transfer on death deeds let the property avoid probate but do not necessarily provide additional protections and the use of this deed should not take the place of writing a will. This document is similar to naming a beneficiary of a will because you can choose a charity, a business, a family member or a friend or even a living trust. It’s a good idea to establish a contingent beneficiary as well in the event that the primary beneficiary has passed away. There is no obligation to tell your named beneficiary about the deed, but you still might want to let them know so that there isn’t any confusion or questions when you do pass away. A transfer on death deed is a revocable tool which means that you can revoke it or change it at any point in time before passing away.
You will need to revoke the transfer on death deed in the same manner in which you created it and bear in mind that writing a will doesn’t change the transfer on death deed. The beneficiary is not responsible for the home in any way while you are still alive and therefore does not have legal ownership of the property during this time either. Many people choose a transfer on death deed to help avoid the cumbersome probate process and make it easier for their loved ones to get access to a home sooner rather than later.
A recent study identified that younger people have recognized the value of estate planning largely due to the impacts of the pandemic. If you or someone you know has not yet undertaken estate planning, now is a great time to consult with an experienced and knowledgeable lawyer about the next steps.
This recent study was completed by Caring.com and found that middle and older aged adults are less likely to have a will than they did just one year ago, but those between the ages of 18 and 34 are 63% more likely to have a will in place now.
Many people are thinking beyond the will and considering tools like a health care proxy or a power of attorney that would enable other people to make important decisions on your behalf if something happens to you. The support of an experienced and dedicated estate planning lawyer is instrumental for identifying these extremely important components and it is strongly recommended that you consult with a lawyer sooner rather than later. Your estate plan is not a one and done document.
In fact, it should be revisited multiple times over the course of your lifetime to make adjustments as needed. By forming a relationship with a dedicated lawyer now, you can figure out the next steps to take and the most important strategies and documents you need to put in place now.
A payable on death bank account is one way to enable someone to receive quick access to a bank account when you pass away. It is easier to do than many other forms of estate planning since it often requires the completion of a simple form with your bank directly, however, there are some potential pitfalls to going this route. Make sure you discuss your options with your NJ estate planning lawyer to ensure that you’ve covered all the most important bases when planning for your future with bank accounts.
You are not able to shortchange your family or creditors with a payable on death bank account. You still have legal obligations even if you successfully avoid probate. A payable on death bank account or any other asset passing outside of probate could be used to pay your taxes or to support your spouse or minor children temporarily and can also be subject to the claims of creditors or your family.
If you live in a community property state your spouse is already the legal owner of a half interest in your account even if the account was only in your name. Make sure that you discuss your options directly with an experienced estate planning lawyer since this will give you the best possible way to understand all of the different assets you own and how you can pass them on to loved ones effectively.
Owning a family business gives an excellent opportunity to pass on wealth to future generations, but this is only possible when you have a clear business succession plan created and implemented in advance.
Many business owners rethought their decisions about their succession plan and retirement in the light of covid. Many of them were confronting these issues for the very first time. Research from PWC’s US Family Business Survey shows that only 1/3rd of business owners with a family company in the United States have a documented, comprehensive and clearly communicated succession plan in place.
There are dangerous consequences for failing to have this plan in place, such as limited tax planning opportunities or not having the right people in place to run the company. Most people do not anticipate leaving their family business any time soon but an exit that occurs too quickly or without proper training opportunities for the next round of leaders could have unfortunate consequences with your existing customers and clients.
This makes it all the more important to retain the services of an experienced and dedicated lawyer to create a business succession plan that works for you and your company.
A business succession plan is a living document that will have action steps and task items that will need to be addressed while you’re still in place in the company. This gives you the best possible opportunity to influence the future generations and to make sure that everyone who is stepping into the leadership roles will have the appropriate support and training to do them in the future.
There are several different areas of transition including the family, the business, the founder, management and ownership. Make sure that you’ve also considered the estate tax consequences before working with a knowledgeable lawyer.
A recent research study indicates that generation X does not have the same amount of retirement preparedness as baby boomers. This is especially concerning given that Gen X members will have to rely more on their own savings when it comes to retirement security overall.
The Employee Benefit Research Institute found that Gen X families were less likely to have defined benefit plans than baby boomer families did at the same ages. Furthermore, Gen X families were less likely to own a home which was a potential source of retirement security for many.
The study looked at the millennial generation and how it compares to Gen X at a similar point in their lives. Creating a comprehensive retirement plan and incorporating this as part of your evaluation of your estate plan is very important for protecting your interests.
Many people think primarily about reaching a target number when it comes to retirement planning, but this could also influence the assets that you leave behind to your loved ones. It is therefore important to consider the big picture and the possibility of outside and unexpected costs, such as those associated with long term care. Working directly with an estate planning lawyer will give you the opportunity to evaluate all of these key issues and determine the most appropriate way forward.
One of the most important questions to be considered as you broach the estate planning process is to evaluate those people who are reliant on your income. If you are currently the primary breadwinner for your family, your sudden disability or death could present significant problems to your loved ones.
Thinking about these possibilities and taking proactive steps to protect your loved ones can go a long way towards enabling them to make quick decisions and to care for these important aspects after you pass away.
With your income gone life could change in an instant for your dependents with no solution in place. In addition to constructing a comprehensive estate plan that passes on your assets to your loved ones, you also need to think about protecting against loss of life.
This is typically done using life insurance which allows your chosen beneficiaries to receive these assets outside of the probate process and much more easily. This can provide for immediate financial support for your family members so that they can make the decisions most important to them. With so many different things to think about in the wake of your loss, you can make things easier for your family members by contemplating the creation of an estate plan that incorporates additional support through the vehicle of life insurance.
When you pass away, there is a good chance that at least part of your estate will enter probate in your state. With estate planning, you can remove as many assets from your probate estate as possible, but only when you have carefully considered all assets and liabilities and followed through with retitling things into the name of trusts, among other strategies.
But this might prompt you to ask, why avoid probate in the first place? The truth is that any number of problems can pop up as your loved ones attempt to navigate the probate process, all of which can take time, energy, and money from your family members during time when they are already coping with grief. This is why most people who recognize the challenges of probate will sit down with an estate planning lawyer to walk through their options for making things easier for loved ones.
While probate problems can be very specific to your assets and your own estate, here are some of the most common ones that you might want to prevent with proper planning:
- No one wants to be the executor, or loved ones argue about who will serve in this role, leading to additional family conflict
- Dispute over the value of the estate or the executor being unable to find certain assets
- Division of asset concerns where people receive equal shares of something and are not able to agree on what to do with that asset
- Someone challenges the validity of the will entirely, slowing down probate and possibly increasing conflict between beneficiaries
Being proactive about these concerns can help you create an estate plan that addresses these issues and makes it easier for your loved ones to move through the probate process.
Someone who inherits real estate through a transfer on death deed should find it relatively simple to have ownership transferred to them after the original owner passes away.
A short sworn statement usually needs to be filed by the transfer on death beneficiary in addition to submitting a death certificate copy for the public land record office. This indicates that the property changed hands, the time that it changed hands and the new owner.
The affidavit typically needs to include the property, the date of the previous owner’s death and the name of the new owner. You will want to check directly with lawyers in your area to determine whether there are any other requirements because affidavits for different states can be slightly different. If you wish to explore other options for passing your assets outside of a transfer on death deed, one of the best ways to do this is to look through all of the strategies available to you by working with an estate planning lawyer.
An estate planning attorney is a knowledgeable partner in the estate planning process who can help you with every aspect of your plan from beginning to end and help you to understand the options available to you while you are still alive to create comprehensive strategies for those you love.
If the past two years have handed down several lessons, at least one of them is that it helps to overprepare in the face of possible uncertainty.
Planning ahead for retirement means proactively thinking about the kind of lifestyle you want to achieve once you stop working full time, but you can’t afford to neglect the important issues around taxes.
If the vast majority of your retirement savings are in 401(k)s or IRAs, you might have a significant problem when it comes to taxes in the future. There is a good possibility in future years that when the Tax Cuts and Jobs Act of 2017 expires after 2025, your tax liability situation could be changed. You also need to think about the possible tax impacts of what might happen if you pass away first and your spouse inherits your tax deferred accounts.
There can also be significant tax implications for children who might need to withdraw money sooner than you intended from these tax deferred accounts. Having a comprehensive estate planning strategy that encompasses all of these key issues and prepares you for what to expect can be extremely important for your next steps. Set up a time to speak with an experienced lawyer today to craft a custom retirement and estate plan that work together and support you well into the future.
Estate taxes can be a complicated subject especially as they are often a discussion in public policy. Approximately 0.2% of US adults who passed away in recent years owed estate taxes. In 2022, the estate tax is only triggered by those people who have an estate with assets in excess of $12.06 million.
Estate taxes will be charged on the fair market value of a person’s assets when they pass away if their estate is larger than this amount. This is why many people take an opportunity to consider all of their different assets by creating an inventory list and discussing their planning options with an estate planning lawyer.
For calculating estate taxes, this begins with totaling the fair market value of assets like insurance, securities, real estate, annuities and business interests to determine the gross estate. Not all assets are included in a gross estate, such as life insurance policy proceeds so make sure to subtract those. There are also allowable deductions for items excluded from estate taxes, such as funeral expenses, state administration taxes, property that passes directly to surviving spouses and more.
Then consider the value of lifetime taxable gifts to your taxable estate beginning with any gifts made in 1977 and subtract the estate tax base. As you can see, it can be very complicated to figure out if your estate qualifies for estate taxes and how much it could really impact the value of everything inside. Even if you do not have enough assets inside your estate to trigger the estate tax, it can be valuable to work with a knowledgeable estate planning attorney to create a customized plan.
New research from the Max Planck Institute for Demographic Research indicates that putting off retirement until a later age could slow down your rate of cognitive decline.
The research found that staying in your full time role until at least age 67 can help to protect you against cognitive impairment such as that caused by Alzheimer’s. Researchers looked at data pulled from the United States from more than 20,000
Americans between the ages of 55 and 75. The study indicates that there may be unintended consequences but positive ones of postponed retirement. You might also be able to pad your retirement accounts and develop passive income strains by staying in the labor market longer than you intended.
These important considerations should all be woven into the strategic plan for your estate plan and your retirement plan. The support of an experienced and dedicated lawyer can help you to identify your next steps and how to use your goal and legacy plans to accomplish your individual strategies and plans.
The support of an experienced lawyer is instrumental in helping you answer these important questions and to craft a custom holistic estate plan.
The spread of the Omicron variant of Covid-19 is prompting many financial professionals to reach out to their clients to update those clients’ financial plans. It is very important for everyone to identify gaps in their current financial plan and to develop a strategy for the oncoming uncertainty.
It is a great time to think about your goals and life priorities and ensure that you have the documents and financial strategies in place to help you achieve them. Many people have paused creating or updating their plans because there is so much swirling uncertainty as it relates to how the Omicron variant or future strains of the virus will impact the economy.
However, it is very important to keep your plan updated on a regular basis because of this uncertainty so that you don’t leave yourself or your family members in unnecessary difficult situations. Having a conversation with an experienced and dedicated estate planning lawyer is one important step in this process and the beginning of a new year is a great opportunity to reflect back and ensure that your personal goals will be accomplished with the creation or updating of this current plan.
Do not hesitate to reach out to our New Jersey estate planning law office to learn more about how to analyze your existing estate plans and to adapt them for the future. Since no one knows what the future holds, you can ease your concerns about making things simple for your loved ones with the creation of an estate plan aligned with your needs.