I’m Rich! What Should I Do Now?

I’m Rich! What Should I Do Now? WMUR.com’s recent article, “Handling unexpected wealth,” says the first thing to do is to really step back and review your finances.

Depending on how much you have received, you could be in a very different place financially. You should take a look at your net worth and cash flow.

What these items show you and how much access you have to your new funds will affect the extent to which your finances might change.

You might have received your assets through a trust, and the trust provisions will dictate how you get those assets. Depending on these instructions, you might not have control over the funds. It’s the trustee who will decide this based on the trust document.

Get a copy of the trust and review the terms with an estate planning attorney. This will give you some idea of the income the trust will provide you.

It’s a different set of issues when inheriting or receiving stock as a gift. Look at your investment strategy to see if the stock has a place in it.

This will help you decide whether to keep the stock or sell it. Instead of stock, you might have inherited real estate. The decision here is the same as to whether to sell the property or keep it.

Your inheritance may also be plain old cash. Think about your future needs and how long your money must last.

Take the time to come up with a well-thought-out plan for both your current needs and your future goals.

Finally, any newly acquired money can also affect your estate plans. Go through your plan and strategies with an estate planning attorney.

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable Trusts, Estate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-449-8191 to schedule your free consultation.

Reference: WMUR.com (December 12, 2019) “Handling unexpected wealth”

 

What Should I Know About Finances for My New Blended Family?

What Should I Know About Finances for My New Blended Family? The blended family is a family dynamic that is increasingly common, which can make addressing financial issues much more of a challenge. In a blended family, a one or both spouses have at least one child from a previous marriage or relationship, and together they create what’s known as a new combined family.

CNBC’s recent article, “4 ways to help blended families navigate finances,” reports that a staggering 63% of women who remarry come into blended families, with 50% of those involving stepchildren who live with the new couple, according to the National Center for Family & Marriage Research.

The issues in a blended family can be demanding, so couples often delay having the “money talk.” This is an important piece of the family financial puzzle. Let’s look at some of the ways you can work on that puzzle:

  1. Get expert advice. Talk to an estate planning attorney about the specifics of your blended situation.
  2. Create a plan for merging relationship and money. Understanding the role money plays in combining two families is critical to the success of a healthy blended household. A basic step may be to draft a detailed plan of how the couple is going to care for one another in their marriage and in their family, in addition to how they will care for one another’s children. Try to determine the ways in which money plays a role in coming together. The more you can communicate and the more that you can exhibit a united front, even from a financial perspective, the stronger a couple will be.
  3. Collect documentation and monitor your money. It’s good to understand the work involved with the preparation and paperwork after divorce and remarriage. You’ll have a divorce decree or a domestic partner agreement, as well as instructions on child support and alimony. You also need to keep track of all the different financial accounts.
  4. Discuss your financial issues regularly. First, ask about the financial obligations to the ex-spouses. Make sure both spouses understand if there’s child support and/or alimony, as well as responsibility for paying for housing or their utility bills.

Reference: CNBC (November 23, 2019) “4 ways to help blended families navigate finances” 

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable Trusts, Estate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-449-8191 to schedule your free consultation.

 

How Much Will I Really Spend in Retirement?

How Much Will I Really Spend in Retirement? People are living longer today, compared to previous generations. This means that their retirement savings need to last longer. As a result, you’ll need to be certain that you’re calculating your retirement spending accurately.

Kiplinger’s recent article, “Planning for Retirement? You’re Probably Underestimating Your Spending,” explains that general figures and trends don’t consider a person’s health and many other factors. Still, you should anticipate a lengthy retirement, which makes it even more critical to understand your cash flow and break out your expenses.

It’s not uncommon for people to totally underestimate their post-retirement spending. They don’t see the many additional expenses they’ll incur after ending their employment or selling their business. The common notion is that as you get older, you spend less. However, there are new expenses that come with retirement and current costs that you may not be accounting for.

Let’s look at the four main types of expenses that prospective or new retirees need to plan, when creating a budget. Educating yourself in these areas will help to have a comfortable retirement.

  1. Formerly business-subsidized expenses. For many, the job provides more than a salary. It can include health benefits, cell phones and health club memberships. To avoid some surprise when you retire, make a list of the expenses that are now covered by your employer or business. Some you might be able to do without, while others may be a necessity in retirement.
  2. Overlooked expenses. Many people do the majority of their primary spending on one credit card. However, when they estimate their spending for retirement, they forget about spending on other credit cards and regular services and charges that may be paid for by cash or check, such as landscaping, housekeeping and real estate taxes. Prior to retirement, go through all your expenses and how they’re being paid. This should help flesh out a thorough understanding of your spending.
  3. Health care expenses. Even if you hit retirement without a major accident or illness, you’re still probably going to spend a good portion of your income to stay that way. A recent study found that a healthy male-female couple retiring at 65 in 2019 can expect to spend $285,000 on health care over their retirement years. Medicare begins at 65 and covers many expenses, but there are many common health care costs that are not covered, such as dental and vision services, prescription drugs (unless you buy a supplemental plan, such as Part D), and long-term care. Out-of-pocket costs can also shoot up, if a senior has a serious or chronic disease, like a heart condition.
  4. Recurring non-recurring expenses. You may get a new car or need a major repair in your house. These are considered non-recurring expenses you commit to sparingly, or just once in your life. However, big purchases and unexpected costs occur more often than you’d imagine. It’s a good practice to plan for at least one “one-time purchase” each year to cover these unanticipated bills.

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable Trusts, Estate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-449-8191 to schedule your free consultation.

 

What Estate Planning Documents Do You Need?

What Estate Planning Documents Do You Need? Wouldn’t your children be relieved to learn that you’ve done all the necessary advance planning so that if you should become incapacitated, someone has been properly appointed to help with health care and financial decisions? The Tennessean suggests that you “Give your loved ones peace of mind with legal documents” so that your spouse and your family will be able to take the necessary steps to give you the care and dignity you (and they) deserve.

Here’s a checklist of the documents that everyone should have in place:

Power of Attorney for Health Care. When you have mental capacity, you can make your own decisions. When you do not, you need someone to be appointed who knows your beliefs and wishes and has the ability to advocate for you. Ideally, you should name one person to be your agent to minimize arguments. Talk with your family to explain who has been named your power of attorney for health care, and if need be, explain why that person was chosen.

Power of Attorney for Finances. There are different kinds of POA for finances. The goal of the POA for finances is so they can make decisions on your behalf, when you become incapacitated. Some states use “springing” POA—but that may mean your family has to go through a process to prove you are incapacitated. Check with an estate planning elder law attorney in your state to see what the laws are.

Advance Directive. This describes what kind of life sustaining treatment you do or do not want if you are in a coma, are terminally ill or have dementia. You can direct whether you want CPR, tube feeding, and other life-sustaining procedures to be withheld, if your quality of life is diminished and there is no hope of improvement. This will help your family to know what you want in a time when emotions are running high.

Last Will and Testament. Have a will created, if you don’t already have one. This directs distribution of your assets to your wishes and does not leave them to the laws of your state. Not having a will means your family will have to go through many more court proceedings and people you may not want to receive your worldly possessions may get them.

Trusts. Talk with your estate planning attorney about placing assets in trust, so they are not subject to the public process of probate. Your wishes will be followed, and they will remain private.

Reference: Tennessean (Nov. 16, 2019) “Give your loved ones peace of mind with legal documents”

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable Trusts, Estate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-449-8191 to schedule your free consultation.

 

Blended Families Need More Thoughtful Estate Plans

Estate planning for blended families is like playing chess in three dimensions: even those who are very good at chess can struggle with so many moving parts in so many dimensions. Preparing an estate plan requires careful consideration of family dynamics, and those are multiplied in blended families. This is another reason why estate plans need to be tailored for each family’s circumstances, as described in the article “Blended families have unique considerations in estate planning” from The News Enterprise.

The last will and testament is often considered the key document in an estate plan. But while the will is very important, it has certain limitations and a few commonly used estate planning strategies can result in unpleasant endings, if this is the only document used.

Spouses often leave everything to each other as the primary beneficiary on death, with all of their children as contingent beneficiaries. This is based on the assumption that the second spouse will remain in the family home, then will distribute any proceeds equally between the children, if and when they move or die. However, the will can be changed at any time before death, as long as the person making the will has mental capacity. If when the first spouse dies, the relationship with the surviving children is not strong, it is possible that the surviving spouse may have their will changed.

If stepchildren don’t have a strong connection with the surviving spouse, which occurs frequently when the second marriage occurs after the children are adults, things can go wrong. Their mutual grief at the passing of the first spouse does not always draw stepchildren and stepparents together. Often, it divides them.

The couple may also select different successor beneficiaries. The husband may name his wife first, then only his children in his will, while the wife may name her husband and then her children in her will. This creates a “survival race.” The surviving spouse receives the property and the children of the spouse who passed won’t know when or if they will receive any assets.

Some couples plan on using trusts for property distribution upon death. This can be more successful, if planned properly. It can also be just as bad as a will.

Trust provisions can be categorized according to the level of control the surviving spouse has after the death of the first spouse. A trust can be structured to lock down half of the trust assets on the death of the first spouse. The surviving spouse remains as a beneficiary but does not have the ability to change the ultimate distribution of the decedent’s portion. This allows the survivor the financial support they need, giving flexibility for the survivor to change their beneficiaries for their remaining share.

Not all blended families actually “blend,” but for those who do, a candid discussion with all, possibly in the office of the estate planning attorney, to plan for the future, is one way to ensure that the family remains a family, when both parents are gone.

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable TrustsEstate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-418-0169 to schedule your free consultation.

Reference: The News Enterprise (November 4, 2019) “Blended families have unique considerations in estate planning”

 

A Good Estate Plan Equals Peace of Mind and Peace in the Family

A Good Estate Plan Equals Peace of Mind and Peace in the Family: The problems aren’t always evident when the first parent passes. Often, it’s when the second parent becomes gravely ill, that lapses in estate planning become evident. For one family, everyone thought estate plans were all in place after their father died. When their mother suffered a stroke, the adult children learned that they had no access to her financial accounts or her health care directives. No one had thought to update the estate plan.

However, when one parent passes, the family needs to take action. That’s the lesson from the article “Avoid heartache and anxiety with estate planning” from Post Independent. In this case, the family never thought to modify or add anyone’s name to the financial accounts, power of attorney documents, medical power of attorney documents, or HIPAA consent forms. What often happens in these cases, is that family members start bickering about who was supposed to do what.

For those who have not taken the time to learn about estate planning, planning for end-of-life legal, financial and medical matters, the quarrels may be inevitable.

Estate planning is not just for wealthy families. If your aging loved one own property, stocks, bonds or any other assets, they need to have a will, advance directives, powers of attorney and possibly some trusts. Take the time to understand these documents now, before an urgent crisis occurs.

There are few formal courses that teach people about these matters, unless they go to law school. Nearly half of Americans age 55 and over don’t have a will, according to an article appearing in Forbes. Fewer than 20% of these people have health care directives and the proper types of powers of attorney in place.

When it comes to preparing for these matters, the laws are very specific about who can participate in health care and financial conversations and decisions.

Here are some of the documents needed for an estate plan:

  • Last Will and Testament
  • General, Limited and/or Durable Power of Attorney
  • Health Care Power of Attorney
  • Living Will
  • Advance Care Directive
  • HIPAA Consent Form

Preplanning will greatly assist family members and loved ones, so they know what medical and financial efforts you or your parents would want. Having the documents in order will also provide the family with the legal means of carrying out these wishes.

The legal documents won’t solve all problems. Your brother-in-law will still be a pain in the neck and your oldest sister may still make unrealistic demands. However, having these documents in place, will make the best of a bad situation.

Speak with an estate planning attorney to ensure that your estate plan, or your parent’s estate plan, is properly prepared. If someone has moved to another state, their estate plan needs to be updated to align with their new state’s laws.

It is our goal to provide our clients with the highest level of legal services in the areas of Last Will and Testaments, Living Trust, Irrevocable TrustsEstate Planning, Probate, Asset Protection, and complete Business Planning. If you or someone you know needs information on Florida estate planning, please contact us today at 239-418-0169 to schedule your free consultation.

Reference: Post Independent (November 3, 2019) “Avoid heartache and anxiety with estate planning”