Five Tips to Avoid the Probate Process

You might have heard that probate is an expensive and time-consuming process, and that is certainly true. Another added downside of probate is that your personal estate becomes a matter of public record.

This is one of the biggest reasons to consider avoiding going through the probate process. You and your family members have your own reasons for wanting privacy and a faster process.

Inheritance paper scrap on US cash

A properly structured estate plan makes things easier to transfer those assets efficiently without a grueling process known as probate. Without a will, the probate process is officially guided by your state’s legal standards for the distribution of property after a person passes away.

Avoiding probate now will help your family members in a difficult time and ensure that your estate is managed as efficiently as possible.

There are five simple ways that you can discuss with your estate planning lawyer about how to keep an estate out of the probate process. These include:

  • Proper titling, including joint tenancy with rights of survivorship or tenancy by the entirety.
  • Using certain accounts that allow for beneficiaries to be designated, such as a life insurance policy.
  • Gifting assets while you are still alive.
  • Establishing a living trust that you can make edits to over the course of your life.
  • Using a life estate.

No matter what type of estate plan you intend to pursue, you should consult with a lawyer about how to handle this situation and what makes the most sense for you and your loved ones. Avoiding probate might not seem like something that benefits you directly, but during a time when your loved ones are already grieving and attempting to move on from the loss of someone they care about, having a thoroughly established estate plan means one less thing for them to worry about, enabling beneficiaries to receive assets sooner rather than later and minimizing the chances for a conflict or dispute around your estate planning intentions.

 

Estate Planning and Looking Ahead for Longevity

There are many different steps you can take to increase your chances of a successful retirement and many years lived beyond that point. Longevity has increasingly become an important component of overall estate, financial and retirement planning. Since although people are living longer, they are also more likely to be in need of long term care assistance.

Friendly young doctor talking with older patient in hospital

While a long life might be seen as an excellent gift, there are also legal and financial challenges that could be present. The earlier you can work to address or to prepare for these, the easier your older years will be. A non-smoking 65-year-old man today has a 50% chance of living until age 85 and a non-smoking 65-year-old woman has a 50% chance of living until age 88.

These four different steps can help you to be aware of the risks and the benefits of living into old age. These include:

  • Contemplate long term care since it’s likely that at least one member of a married couple will end up in a nursing home. Traditional long-term care policies can be extremely expensive, so make sure you do your research before selecting how to protect yourself.
  • Plan for incapacity. While it’s easy to assume that you might never be at risk of being incapacitated and unable to make decisions for yourself, failing to prepare for this possibility can take an emotional and a financial toll on your family members. Make sure that you’ve contemplated who can step in to make decisions on your behalf in terms of medical care and your financial needs.
  • Avoid probate by using an experienced estate planning attorney so that your loved ones can avoid this lengthy and problematic process.
  • Minimize your taxes. Make sure that you sit down with a knowledgeable estate planning attorney to discuss whether or not your estate will be affected by federal estate taxes. Even if it is not, there are plenty of steps you can take to maximize the money that you have set aside for your loved ones as well as for your own retirement.

 

Use A Solid Foundation for Your Estate Plan

Teamwork is necessary for the comprehensive estate plan that will accomplish the vast majority of your goals. If you don’t have appropriate estate planning tools in place, your loved ones could be the ones to deal with the consequences. Work with a team of professionals who understand how your estate can be affected by your investments, your taxes, and your retirement income plan.

This gives you peace of mind that your estate plan is well thought out and all-encompassing. There are multiple steps that you should consider when putting together a thorough estate plan. These include:

  • Looking at your existing will and trusts to determine whether these need to be updated.
  • Putting together a balance sheet of all of your liabilities and assets.
  • Collecting any personal data about you, your family and your personal belongings.
  • Evaluating all estate tax options.
  • Determining the best way to distribute benefits inside your retirement plans.
  • Determining what liquid assets you have that could meet possible estate taxes and expenses.
  • Computing liabilities related to asset protection, gifts, income tax liabilities and estate tax liabilities.
  • Determine the best method to get rid of your share of community property.
  • Thinking about things like the unlimited marital deductions.

These tasks are just some of the most basic and instrumental elements of comprehensive estate planning and of course, your experience will vary based on your individual goals, the structure of your family, and other critical issues linked to the estate planning process. Make sure that you consult with an attorney who is committed to applying your unique situations into your estate planning documentation.

Business – meeting in an office, lawyers or attorneys discussing a document or contract agreement

All the right paperwork can be gathered, organized, and reviewed on a regular basis by a lawyer. Remember that as your life circumstances change, so too should your estate plan. New tax laws, marriages, divorces, children, or grandchildren can all prompt you to rethink your existing strategies.

Advance Wealth Planning Tips for Tax Preferred Saving Strategies

The federal government has long provided incentives for families to save, based on three different types of tax preferences; deferral, deductibility, and tax-free distributions. For wealthier households, however, a more advanced planning strategy is required. The appropriate mix of tax preferenced vehicles should include a conversation with your estate planning and asset protection planning attorney to generate a hierarchy. The right approach considers the preferenced accounts first and after those contribution limitations have been met, this will then spill additional savings over to the following tier.

The glass wall of the building with the inscription Bank

When this is used as part of a holistic planning strategy, the hierarchical model helps those people with significant assets and high levels of income to minimize their tax liabilities, while also maximizing growth of the savings.

Tax preferenced retirement accounts come in two different forms; traditional accounts and Roth style accounts. Roth style accounts are not deductible when contributions are made but are tax free when distributed. Whereas, a traditional account gives a tax deduction for contributions, but the distributions are ultimately taxed. These retirement accounts are, in some sense, double tax preferenced since they get tax deferred status on assets inside the account in addition to tax free distribution treatment at the end or a deduction up front.

Households that are earning $300,000 or more might have different goals than families with different incomes. Some of the most common goals for these advanced earners include building family wealth, maximizing economic value of the dollars being saved, paying for college or saving for retirement. Consulting with an experienced estate planning lawyer is strongly recommended when you are trying to figure out what is most appropriate for you and your loved ones.

 

Don’t Forget Special Needs in Your Estate Planning

Financial planning is important for all families but having a child with special needs makes it even more imperative that parents consult directly with experienced professionals. Financial and estate planning for families with special needs should look to do everything possible to protect the special needs beneficiary’s rights and entitlement to particular government programs.

For those parents who have children with special needs, the cost of a college education and adulthood can be catastrophic. In fact, the American College of Financial Services in Pennsylvania estimates that the typical cost of raising a child from birth to age 18 is $250,000, but it could be much closer to half a million dollars for a child with special needs.

Using the right strategies and professionals well in advance can help parents tackle the unique obstacles and issues that may be associated with providing care for a special needs child. Assembling a team of knowledgeable professionals who have worked in this field over the course of multiple years and have helped other families like yours is essential for giving you peace of mind. Some of the most important players on your team included an accountant, a caregiver, an estate planning attorney, and a financial advisor. Available government benefits should always be given top priority when establishing a long-term estate plan.

Little girl with special needs enjoy spending time with mother in nature

The support of an experienced lawyer is valuable for guiding families through common missteps that could otherwise expose their loved one to having those benefits slip away. Most parents and families are concerned about how to best protect these benefits, particularly, after the parents pass away and this could be a significant financial resource for the special needs child. However, basic estate planning mistakes could mean that those benefits disappear entirely, and it might be too late for the child after the issues have already emerged following both of the parents passing away.

If no other caregiver has been established in this important role, the special needs child could truly struggle to live their adult life. Careful planning well in advance should look at all of the important issues related to special needs planning and should provide a road map for how to protect current benefits and maximize strategies for care in the future.

Art Collecting and Estate Planning 101

For those art collectors thinking about passing on their most valuable collection to others when they pass away, valuation and organization of this collection is strongly recommended. One way to pass on artwork is extremely risky. This refers to the matter of simply putting post-it notes on the artwork on the wall to explain who gets what. This approach, however, could represent that a significant portion of the value of the estate goes towards estate taxes.

Estate taxes might not be an issue for many since the federal estate tax and gift tax exemption is $11.89 million per person. However, if an art collector accumulated a great deal of artwork, ignoring the overall value could cause problems later if it is not appropriately reported. You could pass on penalties, tax fraud, unexpected estate taxes and fines to the person who receives the art, in addition to prolonged IRS proceedings. Since the statute of limitations for tax fraud is limitless, you need to understand the possible complications well in advance.

Even if artwork comes in at a value well below the estate tax exemption amount, clarity and organization regarding the disposition in the value of the individual artwork plays an important role in keeping the peace among your beneficiaries. The first step in this process is to make an inventory. List out each piece of art and its recommended value. Hire an art appraiser who has extensive experience in the field if you want to verify that the information is correct. It is not a good idea to attempt to ballpark the value of art. Rather it is much more effective to use an actual art appraiser and keep documentation from this process.

Any large items or special collections in your estate deserve extra attention. If you don’t put in the effort for your beneficiaries on these items, the problems all fall to your loved ones. You might be doing unnecessary harm or causing confusion that can be eliminated with just a few meetings with your estate planning lawyer. If you’re not yet sure that what you have qualifies as a collection, consider carrying out the valuation process and talking to your lawyer.

 

What You Need to Know About Successfully Managing A Financial Windfall

While some people certainly are successful when winning the lottery or receiving a large inheritance, the vast majority are unsure of how to manage these significant financial windfalls, and this can be very frustrating to realize that happily ever doesn’t just materialize. In many situations, sudden money can leave people worse off than they were prior to the windfall. Many people who are not used to managing such a large sum mismanage the funds. Many people blow through an inheritance or financial windfall extremely quickly, according to economists. It can seem like play money and this is where the risks can lurk for someone who is not familiar with how to handle a large amount. The easiest step to managing a large financial windfall is to understand that it might be best for you to do nothing.

Man in white shirt and black tie holding an empty wallet.

It might seem like taking a luxury cruise, buying a new car or upgrading your current housing situation would be the first thing on your list to accomplish. However, this can lead to a number of different purchases in the same manner that will all leave you feeling regret. Waiting at least six months after receiving a large financial windfall before making any life-changing decisions is strongly recommended. It’s also not a good time to consider quitting your job, at least not right away.

Many people who have been in the unfortunate situation of struggling to manage a major financial windfall don’t realize that making these decisions so early on in their process could put them in line for a significant problem down the road. If you quit your job too soon and then blow through the money, you’ll be right back out on the job market, now with all of the shame and guilt of having to explain what happened if your receipt of an inheritance was in any way public. Make sure that you also think about estate and tax planning concerns. Scheduling a consultation directly with an estate planning attorney is one way to accomplish these goals and to verify that you have spoken to a professional about what to expect.  When your life changes in a big way, you also need to have corresponding changes in your estate planning and related tools.

 

What You Need to Know About Multi-Generational Estate Planning Concerns

U.S. families are increasingly opting to roll things together. In fact, data from a Pew Research Center analysis identified that 20% of the U.S. population lived in multi-generational homes. This brings about important concerns for estate planning. In some cases, this has to do with older children moving back in with their parents in order to make ends meet while carrying through their student loan payments. 

Others may involve grandparents who are involved in providing childcare. Many adult children are now considering how they can rework their existing housing arrangements to accommodate the needs of aging parents who require additional health care support. This means that estate planning and financial planning must be calculated because good planning is crucial to the success of all of these arrangements.

No matter how you look at your family, it includes numerous generations or people that you might want to include in your estate planning strategies.

There are many different multi-generational tax, financial and estate planning issues that can arise. Thought must be given in particular to those questions such as who should own the real estate and if that title is taken jointly in a family partnership, trust or otherwise. Inter-family loans might also be one other option to explore.

Additionally, consider whether or not there exist sufficient assets in the parents’ estate to pay for any estate taxes while also providing for other beneficiaries. Real estate must also be included in the consideration of the overall estate plan and whether or not the plan is fair for all of the heirs. Deciding who should be included on what assets they should receive is extremely important and can help eliminate conflicts in the future.

Navigating the decision-making process means thinking about what it means to include all of your key family members and common missteps that you should always opt to avoid, if possible. Scheduling a consultation directly with an experienced estate planning attorney is often the first step in getting your questions answered and understanding the various tactics and strategies available to you.

 

Don’t Make Estate Planning A Legal Maze

Does your estate planning need to be difficult? It doesn’t, but that’s one of the main reasons why people put it off. You deserve to have an estate planning lawyer who can help you with understanding each step and keeping you informed as your life and planning needs change.

There are many different complications to having an estate plan, but thankfully, working directly with an estate planning attorney can help minimize the challenges and confusion you experience. Health care and estate plans seem something like a legal maze.

This can become even more difficult if you have existing family drama. There can be feelings of anger, mistrust, shame, and confusion, that come with concerns related to health issues, the aftermath of a loved one’s death or finances. Having your affairs in order in case something catastrophic happens, including the possibility of developing a disabling illness or a condition, is good no matter what your age.

Many people come to schedule a consultation with an estate planning attorney when they are in their 50s through their 70s, when children have moved out of the house, and when mortality concerns are at the forefront. The primary reason for doing this at that point in time is because many people aren’t comfortable discussing mortality, but furthermore, don’t realize that they could have benefited from estate planning all along.

A woman wearing a dress trying to make her way through a large maze.

Older adults have unique issues as it relates to estate planning, including guardianship, probate asset protection planning, and dealing with Medicaid. However, estate planning for blended families can be notoriously complex and is one common way in which many people experience pitfalls in the estate planning process and discover it too late after an issue has emerged.

Late in life marriages also require estate planning help. If one partner brings a significant amount of wealth into the marriage but the other party has few assets, this could be problematic if the party with fewer assets ultimately requires expensive long-term care. Since Medicaid will evaluate all of the couple’s assets in determining whether or not that party qualifies for assistance, both individuals might have to use their own personal assets in order to pay for the health care cost. Scheduling a consultation with a knowledgeable estate planning attorney can help you avoid many issues.

 

What Does Bankruptcy Have to Do with Asset Protection Planning?

Bankruptcy can play a role in asset protection planning but only when you have an attorney to help walk you through this. Bankruptcy, unfortunately, may be increasingly necessary for a company or an individual that is facing financial troubles. In fact, more than 2 million companies and individuals file bankruptcy on a yearly basis. Bankruptcy has an important role in protecting assets as well as in eliminating debts. Many debtors will use bankruptcy to protect their wealth in a downturned economy. Many consumers are overburdened with credit card debts, which means bankruptcy as a tool for asset protection planning has increased in recent years.

Depressed man holding credit card over gray background

Bankruptcy is not always the right answer for any person overburdened with financial challenges but it can be the right choice when a person has too many debts to be paid from selling their assets or from their future income. Bankruptcy can be valuable for protecting your assets because all civil actions against you must immediately stop when you file for bankruptcy. This includes seizures, lawsuits, IRS claims, attachments, foreclosures, repossessions and levies. This is because every creditor has a legal responsibility to observe the automatic stay of legal action imposed by bankruptcy. Bankruptcy therefore, gives you the chance to resolve your financial issues with creditors who might otherwise sell your assets or seize them. The timing of bankruptcy is critical as far as how it protects your assets.

Debtors often file too late or too soon and either way, lose out on critical benefits and advantages of bankruptcy. Collecting all tax refunds before you file are recommended. Any tax refunds that are due to you at the time you filed bankruptcy will be claimed by your trustee. You will want to consult with an experienced bankruptcy lawyer as well as an asset protection planning lawyer to clarify that you have addressed all of the most common issues and that the timing of bankruptcy is appropriate right now. If you are concerned about how to proceed, support with a lawyer who can help you.