Monthly Archives: November 2013

Creating a secure financial future with estate planning

Estate Planning

Although creating a clear estate plan may seem morbid to some people, the alternative can be financially devastating. As many corporations and government plans are relaxing their focus on pension plans, it has become even more important for individuals to plan for a secure financial future. While some individuals may fly by the seat of their pants, many financial advisors recommend taking a more proactive approach.

Previous estate planning goals revolved around avoiding getting slapped with high levels of taxation, but current attempts now include elder law plans. As we face longer life-spans, we need to make sure our retirement funds last. Efforts should include making the most of an IRA, providing for essential needs, long-range health care expenses and ensuring our beneficiaries will inherit the financial considerations we want them to enjoy.

Many experts claim that estate planning might seem to represent a loss of financial control, when the end result is exactly the opposite. A clear plan is a way to make sure our assets are distributed according to our wishes. It also reassures clients that the chances to have to rely on family members later on are less likely. Another advantage is it permits us to identify a list of assets, so we are clear about what we are leaving behind. It is never too early to begin to make a checklist of our assets so we don’t forget about investments, real estate, business endeavors, insurance policies, annuities or retirement funds.

Keeping an updated list allows us to be mindful of liquidity and ownership, along with contact information for our heirs. Regardless of income, all individuals should include power of attorney and proxy for health care in case we become unable to make cogent decisions. We also should name a guardian for our minor children. The checklist we make should be revisited and adjusted regularly, especially after important life events, such as marriage, death or divorce.

In being responsible with our estate planning, our beneficiaries and loved ones will receive their proper inheritance and avoid running the risk of competing with a long-gone ex-spouse. In the long run, following these simple recommendations will benefit present and future generations.

Source:foxbusiness.com, “4 Tips to Begin the Estate-Planning Process” Kathryn Buschman Vasel, Nov. 22, 2013

Estate planning and prenuptial agreements: Protecting your assets

Estate Planning

Prenuptial agreements may not be romantic but they are more than just protecting one’s assets in a divorce. These agreements are binding contracts that are being used more often these days to protect one’s separate delineation of wealth and assets.

Baby boomers are one demographic that is becoming more concerned about estate planning as they embrace this tool to protect assets and property acquired prior to a marriage. They may also be on their second or third trip to the altar and be concerned about keeping their children’s financial futures secure. A prenuptial can be a key factor in avoiding assets and possessions that could later be seized by virtual strangers in a messy divorce.

In estate planning, a prenuptial agreement should be aligned with final wills and trusts. These can sometimes override a person’s last will and testament or build evidence to contest a deceased person’s final wishes. Common mistakes many people make is to forget to redo a will when entering into a marriage or neglecting to keep their estate planning up-to-date with any new ventures they begin.

Lack of a prenuptial can be a roadblock to a surviving spouse’s right to claim up to one-third of a deceased spouse’s estate. It can affect being a beneficiary or becoming a designated recipient of income from a trust. A prenuptial agreement may impact the transferring of a business endeavor into a managed trust. Efficient estate planning that includes a prenuptial agreement can ensure that the business stays in the family and is not passed to a surviving spouse’s family.

Estate planning considerations can iron out problems before they occur. Who gets the vacation home? Where will my retirement plan benefits end up? Who will take care of my stocks and investments? These are not topics normally considered the best for pillow-talk, but having such preliminary conversations can avoid years of heartbreak and dissent for generations to come. Considering this prior to marriage can make estate planning a much more palatable discussion topic.

Source:onlinewsj.com, “Prenups and Estate Planning” Liz Moyer, Nov. 15, 2013

Dispute filed over assets left to local police officer

Heirs & Beneficiaries

Concerns have been raised regarding disputes surrounding a late, elderly woman’s decision to leave almost $2 million to a local police officer. The woman’s last will and trust has been called into question, based on beliefs that she was not of sound mind when she initiated last minute changes in her estate.

Opposing legal advisors claim the elderly woman was befriended by a local police sergeant after he answered calls she made regarding an intruder in 2012. She had been diagnosed with dementia in 2010, but allegations suggest the law enforcement official had helped her to draft a new version of her last will, which included changes to her estate plan that benefited him.

Attorneys representing two leading cancer research facilities claimed they had previously been beneficiaries and were slated to receive a half a million dollars upon her death. Now, under the disputed changes, the facilities will receive only $80,000.

A hearing has been scheduled in probate court to discuss the dispute. The police officer has denied any charges of malfeasance on his part, stating he had only assumed the role of a friend with the old woman. He said that any changes to her estate planning were done by her acting alone. Although he claimed that she considered him closer than family, she excluded her own disabled grandson from her will. The grandson later testified that he believed his grandmother was mentally incompetent.

Additional named beneficiaries include local fire and police departments, as well as the school district. Several individuals and entities have come forward contesting the late changes to the will which resulted in their diminished roles as beneficiaries. The situation has been cited as an example of official public corruption.

Our society frequently isolates our elderly. We put them away into nursing homes or assisted living. Some elderly are not thought of until the time of their death when the will comes to light naming beneficiaries in the distribution of assets. At the end of the day, each person is responsible in naming those to benefit upon his or her demise, and ultimately up to the same individual to determine what should be done with his or her own assets and property.

Source: seacoastonline.com, “Legal arguments filed in cop’s inheritance dispute” Elizabeth Dinan, Nov. 16, 2013

Renewed hope for beneficiaries to claim lost or owed benefits

Heirs & Beneficiaries

The Texas Department of Insurance is offering a new resource, called the Life Policy Locator Service, which can be immensely critical in helping those named as beneficiaries to claim what is rightly owed to them.

It has been common for confusion to result when a relative passes on and the designated beneficiary might not know the name of the insurance company issuing the policy or other binding agreement. This can result in unclaimed benefits for those entitled to claims. Now the executor can search for a lost annuity contract or insurance policy on the insurance website.

The department has stated it will take each request and forward it to the insurance companies who are licensed and participating in the program. They forward the requests up to thirty days from when the request is initiated. Companies will search their databases records to see if there is a policy in the name of the deceased. They then attempt to determine if the policy the person named is the beneficiary.

There are currently almost 30 insurance companies in the state of Texas who are voluntarily participating in the locator service. They have provided some tips to help locate a lost policy or contract for a beneficiary, including examining bank statements that track payments to life insurance companies. Checking other records is facilitated with the use of records and notes in smart phones.

According to law, if a policy’s beneficiaries are not located within three years, the insurance company must send the death benefit to the state as part of an unclaimed property fund. This, unfortunately, happens quite a bit so it is a good idea to stay current with records. In order to receive more information about this, it would be wise to go to the web page of the comptroller to study the area in which they list unclaimed property or benefits.

The death of a loved one can be heart-rending. Being able to carry out the final wishes of a family member or close friend who has designated a heir or beneficiary can be greatly facilitated by availing oneself of this new Texas insurance department law.

Source: timesrecordnews.com, “Think you’re an heir? Ask the state” No author given, Oct. 24, 2013

Revocable living trusts create protections for beneficiaries

Heirs & Beneficiaries

Though old Hollywood likes to tell stories of individuals surprised to learn that they have inherited a fortune from a far-removed relative, the days of being in the dark about family finances and estate plans is slowly coming to an end. It is increasingly common for family matriarchs and patriarchs to involve their children and grandchildren into their estate planning. Though there are certainly benefits to being transparent about estate planning goals, it is important to remember that there may be some difficult and unpopular decisions ahead.

It is important to remember that estate planning is not a singular task, but a process. Perhaps a husband and wife first meet with their estate planning attorney alone to discuss their goals. In subsequent meetings, they may bring their children, or they may choose to have a financial planning meeting with their children before returning to their attorney. It is often too difficult to go into an attorney’s office for the first time and walk out with a viable and compelte estate plan.

One of the things that a family may need to discuss is just who will receive some kind of inheritance, or, as some people may see it, who is actually part of the family. There may not be many parents who are willing to deny their children an inheritance, but what about their spouses? Some matriarchs and patriarchs will include spouses, especially if there are grandchildren involved. Others won’t, possibly fearful of a divorce.

Ultimately, families may have a lot to discuss when it comes to estate planning, and it may make more sense to include all relevant parties, not just the heads of the family.

Source:Reuters, “YOUR PRACTICE-Who is family when it comes to estate planning?” Beth Pinsker, Oct. 29, 2013

Designing an estate plan is not always a private affair

Estate Planning

Though old Hollywood likes to tell stories of individuals surprised to learn that they have inherited a fortune from a far-removed relative, the days of being in the dark about family finances and estate plans is slowly coming to an end. It is increasingly common for family matriarchs and patriarchs to involve their children and grandchildren into their estate planning. Though there are certainly benefits to being transparent about estate planning goals, it is important to remember that there may be some difficult and unpopular decisions ahead.

It is important to remember that estate planning is not a singular task, but a process. Perhaps a husband and wife first meet with their estate planning attorney alone to discuss their goals. In subsequent meetings, they may bring their children, or they may choose to have a financial planning meeting with their children before returning to their attorney. It is often too difficult to go into an attorney’s office for the first time and walk out with a viable and compelte estate plan.

One of the things that a family may need to discuss is just who will receive some kind of inheritance, or, as some people may see it, who is actually part of the family. There may not be many parents who are willing to deny their children an inheritance, but what about their spouses? Some matriarchs and patriarchs will include spouses, especially if there are grandchildren involved. Others won’t, possibly fearful of a divorce.

Ultimately, families may have a lot to discuss when it comes to estate planning, and it may make more sense to include all relevant parties, not just the heads of the family.

Source:Reuters, “YOUR PRACTICE-Who is family when it comes to estate planning?” Beth Pinsker, Oct. 29, 2013