Author: Laura Pennington

Planning ahead for potential incapacitation, Medicaid use, and estate planning all feel inherently personal. In fact, they hit so close to home that plenty of people never even begin the process of estate planning.

But for those who do, the planning is often the first and last step they take. A study recently found that most heirs have no idea what their loved ones intend to do with assets. Among those who said they hadn’t told their family members about estate plans, 10 percent reported that it wasn’t anyone else’s business what they chose to do with their assets.

But holding your cards close to your chest like this could backfire in the heat of the moment. Various old copies of wills, verbal agreements to give a certain loved one a treasured piece of art, and sibling rivalry can all lead to additional confusion and even decimation of the assets you’ve worked so hard to build over your life.

In total, at least sixty-four percent of people stated in the study that they’d never talked with their family members about estate planning. Most of those respondents shared that their estates and assets would be divided equally among their heirs, whereas others used different criteria to decide who would get what.

Most families take the top-down approach, with the person who holds most of the assets being the sole decisionmaker when it comes to what happens to those items and the money. If you intend to keep your estate as private as possible, consider sharing your plans and key documents with your estate planning attorney so that someone in the know has access to this information during a crisis, such as if something happens to you unexpectedly. Talking to an attorney can provide you with further information on tools to use and how often to update your material.

You might have heard the term pour-over will while discussing the possibility of a revocable living trust with your estate planning lawyer. A living trust is often used in conjunction with a pour-over will.

The essence of how this works is that all property that passes through your will at the time of your death is transferred into a trust and is then distributed to trust beneficiaries that you named while you are still alive. Many people might be curious about whether or not there are advantages to using a pour-over will.

What’s the reason for having a will that does nothing except transfer property into your trust? The answer is that your estate planning attorney might recommend that it’s a good idea to have all of your assets protected by the terms of only one document and that is your trust document.

There are three major advantages to using this pour-over will. First of all, trusts are private unlike a will. Secondly, you won’t transfer everything you own into your living trust, but the pour-over will gives you a sense of completeness because it takes care of assets that you don’t get around to transferring into the trust prior to your death.

Finally, the last advantage of a pour-over will is simplicity. It makes it extremely clear as to who receives what and, therefore, makes that process simpler for your trustee and executor, who are responsible for wrapping up your estate after you pass away.        

A power of attorney document is instrumental in outlining who is eligible to step in and manage your finances if you become unable to do so. Unfortunately, far too many people make mistakes in the process of creating a financial power of attorney. While this document doesn’t need to be difficult or complicated to make, it is critical that you do it properly with the help of an experienced estate planning lawyer.

There are six major mistakes that can be made in your financial power of attorney, many of which can be completely avoided by sitting down and working with an estate planning lawyer who has extensive experience in the creation of these documents. These common mistakes include:

• Not giving authority over all types of your property. You might want to provide a comprehensive list or specify which type of property they are eligible to make decisions about.
• Not enabling your financial institutions to work with you in advance. Make sure that you have filled out the paperwork to the specifications of these banks or credit unions.
• Making your agent the joint owner of your bank account.
• Not knowing when you need to give additional authority to your agent.
• Not understanding the duties of the agent.
• Not using the power of attorney when you should have.

All of these mistakes can be avoided through your discussion with an experienced and knowledgeable estate planning lawyer.        

You might have heard the term pour-over will while discussing the possibility of a revocable living trust with your estate planning lawyer. A living trust is often used in conjunction with a pour-over will. The essence of how this works is that all property that passes through your will at the time of your death is transferred into a trust and is then distributed to trust beneficiaries that you named while you are still alive.

Many people might be curious about whether or not there are advantages to using a pour-over will. What’s the reason of having a will that does nothing except transfer property into your trust? The answer is that your estate planning attorney might recommend that it’s a good idea to have all of your assets protected by the terms of only one document and that is your trust document.

There are three major advantages to using this pour-over will. First of all, trusts are private unlike a will. Secondly, you won’t transfer everything you own into your living trust, but the pour-over will gives you a sense of completeness because it takes care of assets that you don’t get around to transferring into the trust prior to your death. Finally, the last advantage of a pour-over will is simplicity. It makes it extremely clear as to who receives what and, therefore, makes that process simpler for your trustee and executor, who are responsible for wrapping up your estate after you pass away.        

It’s been said that your estate plan is only as good as the agents associated with it. It’s important, for example, to have conversations around the family’s intentions, especially between spouses.

Wives and husbands should both be involved in creating final documents to help avoid unnecessary or unforeseen complications during the most challenging of times for your family. It’s important for you and your spouse to be comfortable with other professional advisors in your life, including an attorney, an accountant, and a financial advisor.

Many spouses might stop here, tempted to keep the details of their estate plan to themselves. However, the communication of the estate plan to any involved children is critical. It’s all too easy in our American culture to put off these discussions due to the potential for conflict. However, taking necessary steps to discuss your intentions with your family members can make things easier if you were to become incapacitated, or if you or your partner were to pass away unexpectedly.

It is important to overcome your short-term hesitations about having conversations on your estate plan for the more long-term benefit of having a clear plan in place that minimizes the potential for disputes.

Every family has their own distinctive dynamics, but providing a deeper understanding of your intent and the estate planning steps you’ve already taken can make things easier for your family members during what will otherwise be a challenging time as they attempt to negotiate the financial and legal steps of caring for you during a time of incapacitation or assisting with family through your recent passing.

Nearly half of all Americans have no estate plan at all, so you’re to be commended if you’re ahead of that curve. But once you’ve dotted all the I’s and crossed all the t’s, it’s time to make sure you’ve secured these documents so that you or a trusted advisor can access them in the event of an emergency.

Your estate planning attorney might be able to help you store your documents, but have a conversation about this first to ensure you know what’s happening to your materials. Most law firms today use fireproof, locked file cabinets. Sometimes an offsite storage facility might also be used if your law firm is located in a big city.

Although most people still want their attorney to hold on to the original documents, this does not mean this is your only option. Some lawyers have turned to providing clients with the originals due to security or storage space concerns. Most people might consider a safe deposit box as the first place to put something like your powers of attorney and will, but the ability to get into such a box is limited. If something happens to you, another person will have to get court authority in order to access the box. And most likely your loved ones can’t get that court authority because the documents to show their rights are in the box.

A fireproof safe is a great way to protect your key documents and ensure that you know where they are at all times. The safe is the right place to keep the originals and you can store other copies elsewhere. Go back to review your documents on a regular basis and make sure to update any originals in the safe as well as where you’ve stored copies if you make big changes or replace a document entirely.

Whether you’re married, single, or remarried, you’ve got to have an eye towards your own future as a female. Estate planning, financial planning, and asset protection planning are all part of your retirement strategy and connect with how you’ll support yourself in your golden years.

Many women have to look decades beyond their retirement when it comes to their plans given data on longevity and forecasts about the expense of long-term care.

A recent study incorporating insights from high net worth earners found that women ranked themselves highly on their ability to perform a range of financial tasks but diverged from men when it came to their top two current financial goals. Executive women reported that their top goal was to know that they were prepared for the worst and planning for retirement. However, male executives said that providing for future generations and taking care of their dependents financially were two of their top three financial goals.

Plenty of women today recognize that they might live longer than their male partner, or that they could be affected by the phenomenon of grey divorce which would significantly impact their retirement planning goals. Furthermore, women might be recognizing the possibility of needing long term care support which can be quite expensive and can decimate an otherwise carefully crafted retirement plan. If you want to look ahead into the future to prepare yourself for your estate and the possibility of long-term care, schedule a consultation with an experienced estate planning lawyer today.     

Heading off into your financial future without a clear plan and goals is like setting sail without charting your course first. It’s one of the biggest reasons why people feel anxiety over their finances; lack of a plan.

A recent study completed by the Financial Planning Association shows that more than 60% of respondents in a recent study indicated very high levels of negative stress in their life. Furthermore, more than 20% of people who participated in the study said that their stress levels have increased over the course of the past year and more than 30% said that their stress levels have jumped over the last five years.

Prioritizing financial goals and establishing a plan for debt management are some of the most important things that you can do to experience feelings of financial security and lower your stress levels. The study found that nearly three quarters of survey respondents who said they felt clear about their overall financial goals have lower stress levels.

One way to evaluate your current expenses are to assign time frames to your goals, such as short term, medium and long term. Your financial goals can also include looking ahead to the future to establish goals for estate, asset or even business succession planning. A consultation with an experienced attorney can go a long way in helping you to clarify what you intend to accomplish with your financial goals.       

The law enables you to use tools such as trusts and wills to accomplish your goals and provide for the people you care about either during your life or after you pass away. While these are definitely protective tools to begin with, there are unfortunately many people who see themselves as opportunists who use these tools to try to take advantage of others, especially seniors who might be experiencing cognitive decline.

The targets of these kind of schemes are often those people who have significant assets who are vulnerable due to memory issues, advanced age concerns, illness, or family isolations. Family members who might have been expecting an inheritance from a loved one could even be surprised that they are cut out of the will entirely or received much less than they anticipated because another party has exerted undue influence on your loved one.

If a person has received a substantial benefit from a trust or a will and had a confidential relationship with a person who created it and is also active in procuring this gift, this could lead to a presumption of undue influence. This could be a formal fiduciary relationship or an informal trust relationship in which the influencer exerts his or her impact to get the person to include them in the will to make a gift or update their trust such that the influencer is the beneficiary. Being knowledgeable about undue influence and how it can potentially impact your estate is important.   

Many people are already familiar with the 2017 Tax Cuts and Jobs Act that made significant changes to tax planning. However, the gift tax and estate tax exemption should be something that you’re familiar with so that you can leverage these to your advantage. It’s important to understand that the 2017 tax reform pushed up the maximum exemption to what is essentially double the previous amount.

However, with regards to your tax and estate planning, this change is not permanent. By 2026 the exemption will drop down to 2017 levels unless Congress decides to make changes prior to this time. Other plans to reevaluate the exemption level have been put on pause for this moment but it is very likely that Congress will at least reconsider the issue in the near future.

If you already have a taxable estate, it is important that you do not just file this information away. Instead you should begin to take action immediately. For planning of this scope and size, it is critical to work with a team of knowledgeable professionals to assist you with your tax and estate planning concerns.

A certified public accountant, a financial advisor, and an estate attorney are just a handful of the people who can help you understand how you might be currently affected by estate planning and tax planning concerns and how future issues could require you to update your plan all over again. Schedule a consultation to sit down with a knowledgeable attorney today so that you can figure out what makes the most sense for you personally.

When creating your will, it’s natural to be concerned about deciding specific pieces of property or assets that will pass on to the loved one or beneficiary you decide. However, all too many people approach the process of putting together a will in a far too simplistic manner, exposing them to potential challenges or even their loved ones to potential issues in the future.

It’s important to find an attorney that you can trust to work with on your estate plan so that you can avoid many of the most common mistakes that end up following your loved ones into the future. Specific bequests inside a will are managed first in the administration of your estate and the person who passed away may not even own that investment anymore. The estate could be required to purchase an investment at a higher price which could harm beneficiaries if you name the specific investment in your will. Here is a great example of how this could turn into a significant problem. If you leave behind shares of a particular stock, which at the time of creating the will is worth a specific amount of money, such as $5000, the same number of shares could increase in value significantly at the time of your death and those shares might not be owned by you anymore. The estate would then have to purchase those shares and pass them onto a grandchild and this could use essentially all assets inside the estate such that future beneficiaries get little to no assets. Sit down to speak with your estate planning attorney about how to make your estate work for you and how to avoid these kinds of issues.    

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If you’re like most parents, completing that to-pack for college checklist can seem completely overwhelming. But as you get closer to the finish line, it also becomes a challenge to think about how your life- and your student’s life- will change.

For those students on their own for the first time ever, there are a lot of changes around the corner for them. Things they might not have had to think about before, such as what happens if they get into an accident on or around campus? What happens if they need medical attention? Who is allowed to make medical decisions for them?

While you as the parent have served in that primary role for a long time, remember that if your student has hit age 18 and is moving out to attend college that decision-making power does not automatically default to you.

If your child is out of state at college, make sure you add one last thing to your “must-do” list: a healthcare power of attorney. In addition to packing a copy of the health insurance card and important phone numbers your child might need while away at school, it’s key to have these documents created before they go.

While no parent wants to think about something happening to their student, it’s not that difficult to set up a plan to protect them in the event of an emergency. A properly-drafted plan ensures that you get a phone call when something happens to your student on campus and that you can, legally, be brought into the situation to help make medical decisions.

Far too many students head off to their new campus dorms without thinking twice about this issue. While for many the need for a healthcare directive won’t be an urgent matter, it’s worth having that plan in place just in case something happens. Remember, your 18 year old now legally has the right to make decisions, including those related to medical care, on their own- if you’d still like to be involved, make sure you set aside some time to talk about a healthcare directive that will give you peace of mind after they move in.

So you don’t want to sit down and draft a will- or maybe even make the appointment with your attorney. If this is you, you’re not alone.

Numerous studies have undertaken the question of who has a will and other key estate planning tools in place to protect them in case of a sudden accident or incident. Lexis Nexis says that 55% of adults have no plan for the transfer of assets when they die or a legal will. That number spikes even higher among African Americans and Hispanics. You might anticipate that those with higher incomes are more likely to have an estate plan pulled together. However, one recent study found that people who had incomes of between $100,000 and $149,000 had a will less than 10% of the time.

Although that number spikes to 15% for those who had an income that goes beyond $150,000, not having a will can expose your loved ones to unnecessary challenges. Not having a will could mean that your loved ones have to go to a court proceeding known as probate.

This can become more complicated and lead your loved ones to face challenges they didn’t need to if you had sat down with an experienced lawyer. There’s no doubt that answering questions about your future and especially about your own mortality can be difficult, but they also aren’t questions you want to leave behind for your loved ones to handle in a time when they are grieving.        

A key component of your estate plan’s success is being able to keep all the details organized. This helps you to make the best decisions on behalf of you and your family, and enables someone to find these critical documents if something happens to you.

Getting things organized can all also help you identify when there are gaps in your current estate planning. Once you know the gaps, setting up a meeting with a NJ estate planning attorney can help you cover all your bases with your incapacity, estate, asset protection, and business succession planning.

If you were to pass away suddenly, for example, this can save your loved ones from spending critical time searching for important documents in an already difficult period in their life. Here are a couple of top tips to stay organized:

• Keep a binder to store all of your information, including separate entries for cars, real estate and other personal property.
• Keep track of whether or not you’ve spend any amount on improvements, whether or not there is any debt against it, and the underlying value of the item.
• Take a look at each asset you own and decide whether or not this is something worth keeping. You might decide to sell this item now so that loved ones are not left with a financial burden in the future.
• Consider for the assets that you decide to keep, what would happen to that asset if you were gone.

Thinking about these decisions now can make it much easier for your family to go through the process of closing out your estate in an organized fashion.       

Are you thinking about how you can best leave behind a legacy of financial support and love for your family, but haven’t taken the necessary steps to put together an estate plan? According to plenty of research, you’re not alone. Estate planning is often an overlooked as an opportunity to protect your loved ones and yet it can also be one of the most important things you do, not just to protect your future beneficiaries but also to protect your own interests in the future.

There are several different steps that you can take to ensure that your assets and money don’t end up being spent on taxes and legal fees, rather than being used to support your family. Another common misstep that can be made in the estate planning process is forgetting to line item name the prized possessions that you hoped to pass on to certain loved ones.

You don’t want these items ending up in the wrong hands. Although your dreams and goals might change as you move through varying stages of life, and add or remove certain people from your world, one thing never changes: to achieve any goal or dream, you have to have a plan. Your dreams likely reflect what you’re hoping for yourself in your older years, in retirement and also what you hope for your children as far as what you leave behind for them as beneficiaries.

Sitting down with an experienced and dedicated estate planning lawyer gives you the chance to answer all of these questions with a knowledgeable professional who knows many of the most common obstacles and missteps made by people approaching estate planning.       

Americans are notoriously conflicted when it comes to end of life estate planning. Thinking about the future of those we leave behind and confronting our own mortality is difficult, and yet it’s also a key aspect of your financial management necessary for the long term security of your loved ones.

This is why it might come as no surprise to you that only one out of every 10 people living in the United States currently even has an estate plan. The problem with this is that many Americans do recognize that having an estate plan or at least the most document, a will, is important.

A 2019 survey conducted by Caring.com found that 57% of US adults don’t have a living trust or a will in their estate planning. Furthermore, one age category in particular garnered top results for skipping out on these key estate planning documents. Only one out of every five 18-34 year olds indicated that they had an estate plan in place.

Over 1,000 adults participated in the study and 76% of them felt that having a will was important, but so few of them have actually taken the next step to do it. The four most common reasons why Americans don’t have a will, according to the study, include:

• They just haven’t gotten around to it.
• They don’t believe they have enough assets to leave behind to anyone.
• They don’t know how to do it.
• They perceive that it’s too expensive.

Sitting down with an estate planning lawyer can help to remove some of the confusion and misperception of putting together a will.      

Have you already heard about the various types of estate planning tools and documents most commonly created and referenced by people in your state? There’s no doubt that living trust has turned up in your search of key estate planning documents, but how do you know if you need one or not?

What’s the primary benefit of establishing a living trust? And is a will enough to accomplish your estate planning goals?

Most people choose to establish a living trust because it gives them some level of control and flexibility over what happens with beneficiary designations, the structure of the trust and key people involved in the process. An irrevocable trust, on the other hand, can be created once and cannot be altered once established. Those people who may have interests now that they wish to protect and add some layer of privacy and remove from probate, enables them to structure the living trust so that it matches the needs of your life now, but can later be updated.

The circumstances of your life are likely to change over the course of the years. You might know that you need a living trust right now to give you some level of control, privacy and protection from probate, but it’s also likely that you might want to update some things inside the trust or eliminate certain provisions in the trust as your beneficiaries get older or as your unique needs alter. Having an established relationship with an estate planning attorney can assist you with this process because a living trust is a valuable tool to return to as your life circumstances change.     

Having an estate plan for your business is just as important as having an estate plan for your individual purposes. There are many different components that go into a business estate plan including a will, a living trust, a financial durable power of attorney, a succession plan, a buy/sell agreement, and life insurance.

All of these can be discussed directly with an experienced attorney. Your will and your living trust are the cornerstones of your business estate plan.

A will enables you to name who you wish to receive your assets, including your company, if you wish upon your death. A living trust is similar to a will in that it allows you to decide who will receive your assets when you pass away, but this is a private document that has benefits when compared with a will. A financial durable power of attorney enables you to authorize an agent to act on your behalf if you are unable to do so for yourself.

Your succession plan which might also include considerations of a buy/sell agreement and life insurance is your opportunity to outline what will happen to your company in the future if you were to leave. Many people anticipate that they will continue working in their business forever. However, it can be a big mistake to assume that you will always be able or interested in working on your business. Scheduling a consultation with an estate planning attorney who has familiarity with adapting and creating business succession plans should be the cornerstone of the next steps that you take in planning your company’s future.      

With the rising cost of healthcare and all data showing that many people will need some form of LTC in their older ages, it’s costly to assume that any of the three myths listed below are true. Yet plenty of people are under the impression they don’t need an LTC plan or Medicaid planning, giving them limited options when they or a loved one needs to enter a nursing home suddenly.

Myth #1: Medicaid or Medicare Will Cover Me

Medicare does not cover the vast majority of expenses needed for LTC. And Medicaid requires completing a careful application process. Overlooking the need to plan outside of this can be a big mistake or can require Medicaid crisis planning that doesn’t allow you to exercise all your options.

Myth #2: I’m Covered by Other Insurance

Don’t expect that your HMO or disability insurance will kick in to cover most of your long-term care expenses. This leaves you with little to no coverage at all, and those LTC bills can rack up quickly. It’s important to realize that in order to protect your personal assets and savings, you need something outside of existing disability or health insurance coverage.

Myth #3: Only the Elderly Need It

Did you know that a good portion of people who exercise the benefits in a long term care insurance policy are those who aren’t even close to retirement age? Even a serious car accident could leave a young person in need of LTC support or a nursing home stay. Ignoring the potential for an accident or disabling condition in younger years could be catastrophic.

If you want to work through possible planning options, a good time to speak with your estate planning attorney can be set up now. A lawyer can help explain to you some of the long-term plans you can put into place to help protect you should the need for LTC arise.

Retirees today seem to be confused about how much to set aside for long term care. Fidelity Investments shows that the cost of paying for healthcare expenses alone could go as high as $285,000 for an average retired couple at age 65.

Those health care expenses, however, don’t include long-term care. Long term care refers to two different types of support; the first is services for someone who has severe cognitive impairments or requires ongoing supervision for safety reasons, and the second category includes services for someone who needs help with at least two activities of daily living.

Those activities of daily living or ADLs include toileting, bathing, transferring, eating, continence, and dressing. It’s estimated that over 15% of people approaching their older ages will have expenses for long term care in excess of $250,000.

Most people assume that Medicare will kick in to cover these costs or that they won’t need long term care. Both of these can be costly assumptions to make. You’re better off finding an experienced lawyer to help you understand what will and won’t cover your expenses so that you can approach the situation with clarity and make the right decision.

Have you already set aside money to help support you in your older ages and to pay for long term care? If not, it may be an appropriate time to discuss Medicaid planning with an experienced and knowledgeable estate planning lawyer.