Credit Card Debt and Inheritance in Mississippi

By Ronald Morton | Leave a Comment

When it comes to estate planning, many people are confused about what happens to their credit card debt when they die.  Clients tell their Mississippi estate planning lawyers that they thought the debt would be forgiven, for example.  Unfortunately, this isn’t the case, so it’s a good idea to understand what will happen to your estate and the assets you plan to leave to your loved ones.

First of all, your estate will be expected to pay off credit card debt when you die.  In fact, whatever you leave behind will first be used to pay for any outstanding debt.  Creditors of all kinds will have first crack at what you (or your heirs) will have.  Contacting the creditors and getting these debts paid off is one of the most important jobs of the executor of your estate.

However, credit cards aren’t necessarily the first thing that will be paid off, but they are definitely on the list.  If your estate doesn’t have the necessary assets to pay, then other courses of action may be available to those trying to collect on the debt.  If there is another name on the account, for example, they can go after that person for an outstanding balance.

This is important to note if you’ve put your adult child on any of your accounts.  Doing so is a fairly common practice, as it can make it easier for the adult child if they are helping by picking up groceries, paying bills, etc.  By having them on your accounts, they can simply use their own cards for your purchases.

Unfortunately, if and when you pass away, they could become responsible for the entire balance on any of those accounts.  Having them on bank accounts could even have tax implications.  It is really a good idea to work with a Mississippi estate attorney in order to determine what the state and federal laws are as they apply to your situation.  One possibility is to have the adult child or other caregiver listed on the account as an “authorized user.”

Just what funds are used to pay off outstanding credit card debt after death can vary.  In most cases, for example, retirement accounts such as IRA and 401(k) plans with a specific beneficiary are not considered part of the estate.  Those funds pass directly to the named party and do not go through probate and are not available to pay creditors.  This may also be the case with life insurance policies.  Things can get a bit more complicated when talking about real estate or jointly held assets, however.  For example, can one spouse be forced to sell a home that has been inherited by a partner who had a large credit card debt in his or her name?

Laws regarding this and similar issues vary from state to state, which means that your best bet is to work with a Mississippi estate planning lawyer to determine what our laws mean for you and your estate.

Clinton Newlywed Planning for a Better Financial Future – A Few Simple Things to Do

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Entering the newlywed planning stage here in Clinton is incredibly exciting.  Sure, there are dresses and tuxedos, cakes and wedding registries, but more importantly, you are starting your life with someone else.  And you want that life to be as comfortable and “successful” as possible.  That’s why finances should play a part in your newlywed planning.

When many of us get married, we’re young and we haven’t always made the best financial choices.  We may be entering the relationship with debt and a less-than-desirable credit score.  There are a few things that can add up, and if you can take care of them during the newlywed planning stage, you will be able to reduce later stress in the marriage and put it on a good trajectory for financial security.

Take Care of Little Fines

Little fines that you might have incurred may not seem like a big deal, but they can turn into serious problems pretty quickly.  Things like library fines and parking tickets may be quite small to begin with, but if they get turned over to collections (which is happening more and more frequently), then they can suddenly become a much bigger issue.  Not only does the amount of money you owe grow considerably, but just having them go to collections can impact your credit rating by a huge amount.  Remember, your credit rating will soon be linked to your spouse, too, so protecting it now puts you both in a better position later.

Review Your Credit Reports

Speaking of credit scores, you and your future spouse should both take a look at your credit reports (ideally you should look at them together) to figure out where you are financially.  At some point, you will likely want to buy a home or vehicle or even start a business, and now is the time to identify any problems in your credit history and start fixing them.  If you’re not aware of the problem, it will be a lot harder to do what you need to in order to fix it.

Pay Down Credit Cards

Making minimum payments on your credit cards may seem like a good idea, especially when newlywed planning includes so many additional expenses, but now is actually a great time to start paying down balances.  If you’re paying only the minimum, it’s likely that it will take more than a decade to pay off the balance, and that’s if you’re not charging anything new.  By paying extra toward the bill each month, you are reducing the amount of debt that will be in the marriage, not to mention that you will also save you and your spouse thousands of dollars in interest over the next several years.

See A Hinds County Prenuptial Attorney

While having a Hinds County attorney in the mix may not be the most romantic part of the newlywed planning experience, it can actually save your marriage later on.  This person can help direct you when it comes to financial matters and may even recommend considering a prenuptial agreement.  These documents are not just for the rich and famous.  Instead, they can even help average people to set out a clear plan for dealing with finances during the marriage, so that money doesn’t become an issue that breaks the couple apart later.

Awkward Moment! Facing Uncomfortable Issues With Your Trust and Estates Lawyer in Jackson, MS

By Ronald Morton | Leave a Comment

Any trust and estates lawyer in Jackson, MS can tell you that they have to ask their clients a lot of very uncomfortable questions.  Who really wants to think about their own mortality and contemplate what life will be like for their families after their own death or if they were to be incapacitated?  But, by facing these thoughts and questions, you are actually able to have a greater say in what will happen than you would by avoiding the topic altogether.

So, what kinds of issues need to be addressed with your trust and estates lawyer?  Whether you live in Jackson or New York City, there are some basic questions that absolutely must be answered.

You and Your Spouse

One of the most difficult issues to contemplate is what should happen if you and your spouse were both killed together.  While the chance of passing away at the same time is relatively low, it happens.  Laws are typically set up so that one spouse’s estate passes to the surviving spouse, but when both are gone at the same time, things get a little more complicated.

For example, those with minor children need to put serious thought into who will become their children’s guardian.  If you don’t make these decisions in advance, the courts will make them for you; and their choices may not reflect your own.  It’s not uncommon for grandparents to receive custody of the children in these cases if they are still living, but that still leaves open the question of which spouse’s parents would be chosen.  If you have a preference (or want someone else chosen), then you need a trust and estates lawyer in Hinds County to help you make those wishes legally binding.

Children are not the only concern, of course.  Should you and your spouse be killed or incapacitated, who will take care of your finances, inherit your home, or even take care of your pets?  These are all issues which need to be considered in advance.

You and Someone Else

Your estate planning lawyer in Jackson, MS isn’t just being nosey if he or she asks if there is someone in your life besides your spouse who may have a claim to your property.  This definitely falls into the category of “uncomfortable questions,” but if you had a relationship with someone other than your spouse, he or she may come forward after your death with the expectation of receiving an inheritance.

This can also be the case with family members who are estranged.  If you have a child you are no longer in contact with, he or she may still have a claim to your property.  Long-lost siblings or parents to whom you are no longer speaking can also still have a claim.  By setting out your plan with a trust and estates lawyer in Hinds County, you can help to ensure that only those you want to inherit will do so.

As a final note in this area of “uncomfortable topics,” if you and a spouse, previous spouse, or other person have chosen to store genetic material such as eggs, sperm, or embryos, you need to have plans for what is to become of this material.  Not only do you need to consider the material itself, but you also need to consider who might end up with children that have been conceived after you die.

Each of these issues is complicated in and of itself, but in order to come up with a workable estate plan, they must all be considered.  If your trust and estates lawyer in Jackson doesn’t bring up some of these questions but they apply to you, it is in your best interest to bring it up now to avoid problems with your estate later.

Clinton Lawyer Explains How To Tackle Estate Planning When You Live in Two States

By Ronald Morton | Leave a Comment

Being able to split your time between two or more places you love is a much-desired retirement dream for many people.  A great example are those folks referred to as “snowbirds” who live farther north in the US during the summer and then head back to the warmer southern states for the winter.  That allows folks to enjoy our gorgeous Mississippi spring and fall, and relatively mild winter, while escaping our punishing summer humidity.

Many people living this lifestyle completely overlook the fact that it can have a major impact on what happens to their assets when they die.  If you were to pass away in Mississippi, the laws governing your estate may be totally different than those in New York, Vermont, or whatever cooler state you’ve chosen for the hot season.

Some Laws Differ from State to State

Basically, you need to make a decision about which state is your true legal residence.  This may be affected by the amount of time you spend in each or some other factor.  If you’re in a situation where you truly can choose, then you really want to work with a Hinds County estate planning lawyer to figure out which state’s laws are going to be the most advantageous to you and your estate.  There are all kinds of factors which can influence this decision, such as the property laws of each, your marital status, and even tax rates.  For example, Florida has been known for not having estate taxes at all.  This is great, but it does have other taxes that could come into play.

When you pass away, your estate can end up going through probate in both states.  This can be time consuming and expensive, and you may be able to avoid it by working with a Hinds County lawyer to set up some trusts and other protections.  There are some documents, however, that you might want to consider creating in both states where you reside.  For example, it may be helpful to have medical and financial powers of attorney drawn up in both Mississippi and the other state in order to avoid problems and delays should they be needed.

What Do You Do When You Live In Two States?

Even if you “live” in both states, you can only officially reside in one.  You are considered a visitor in the other state.  A Mississippi attorney will be able to help get you up to speed on the laws of our state and can help you compare them to similar laws in the other state where you reside.  Just as you’ve chosen to live in two states for the advantages to your life, there are also advantages to what happens after!

 

Clinton Lawyer Explains How To Tackle Estate Planning When You Live in Two States

By Ronald Morton | Leave a Comment

Being able to split your time between two or more places you love is a much-desired retirement dream for many people.  A great example are those folks referred to as “snowbirds” who live farther north in the US during the summer and then head back to the warmer southern states for the winter.  That allows folks to enjoy our gorgeous Mississippi summers while still keeping warm all winter long.

Many people living this lifestyle completely overlook the fact that it can have a major impact on what happens to their assets when they die.  If you were to pass away in Mississippi, the laws governing your estate may be totally different than those in Florida, Arizona, or whatever warmer state you’ve chosen for the cooler seasons.

Some Laws Differ from State to State

Basically, you need to make a decision about which state is your true legal residence.  This may be affected by the amount of time you spend in each or some other factor.  If you’re in a situation where you truly can choose, then you really want to work with a Hinds County estate planning lawyer to figure out which state’s laws are going to be the most advantageous to you and your estate.  There are all kinds of factors which can influence this decision, such as the property laws of each, your marital status, and even tax rates.  For example, Florida has been known for not having estate taxes at all.  This is great, but it does have other taxes that could come into play.

When you pass away, your estate can end up going through probate in both states.  This can be time consuming and expensive, and you may be able to avoid it by working with a Hinds County lawyer to set up some trusts and other protections.  There are some documents, however, that you might want to consider creating in both states where you reside.  For example, it may be helpful to have medical and financial powers of attorney drawn up in both Mississippi and the other state in order to avoid problems and delays should they be needed.

What Do You Do When You Live In Two States?

Even if you “live” in both states, you can only officially reside in one.  You are considered a visitor in the other state.  A Mississippi attorney will be able to help get you up to speed on the laws of our state and can help you compare them to similar laws in the other state where you reside.  Just as you’ve chosen to live in two states for the advantages to your life, there are also advantages to what happens after!

 

Trust and Estates Attorney in Clinton Answers, “How Much Do You Need to Save for Retirement?”

By Ronald Morton | Leave a Comment

If you’re like 70% of people in the US who have a retirement plan, you still haven’t worked with a professional such as a trust and estates attorney in Clinton in order to determine how much money you really need to save.  A recent study found that only about 30% of this group has actually sat down with a professional to come up with a realistic number.  Another 34% has simply guessed at a number that they think might be reasonable.

Any good Hinds County trust lawyer will tell you that this is incredibly dangerous.  There are so many factors that go into determining what will be needed.  Just a few of these include:

  • What do you want to do when you retire?
  • What assets do you have now?
  • How will inflation impact the value of the dollar?
  • What kind of retirement fund do you have?
  • How long do you have before you retire?
  • How much will you lose to taxes when you withdraw your money?

As you can see, getting to a total that will support your lifestyle during retirement is a bit more complex than simply plucking a number out of thin air.

And, once you have that number, you need to know what has to be done to achieve it.  How much do you need to save monthly/annually?  Are there better retirement tools than what you’re using? The questions keep on coming.

The whole process can be very overwhelming and cause a lot of people to throw their hands up in the air and give up.  Really, though, it’s a matter of having the right information.  Fortunately, a Clinton trust and estates attorney has that information.  He or she knows all of these questions and more and, in conjunction with other advisors, can help you put together a comprehensive picture of where you are, where you want to be, and how to get there.

A good Hinds County lawyer can help you understand what areas you’ve succeeded in for your planning as well as to let you know where you can improve.  With professional guidance, you can learn how much you really need to be contributing to your retirement now in order to reach your goals for later, and he or she can likely help you uncover ways to do just that.

As with just about anything in life, having a clear-cut, reasonable goal is the most important aspect for getting what you want.  Fortunately, trust and estates lawyers in Clinton are well-versed in exactly what needs to be done for this to happen.

 

Estate Planning Trends In Clinton Include Travel Trusts

By Ronald Morton | Leave a Comment

Trust lawyers in Clinton see how trends come and go in the field, and an interesting new one has been showing up increasingly in the last several years.  Those who are creating their wills and trusts are beginning to include their wishes for their survivors to travel more.  In order to do so, they are instructing their lawyers to set up trusts specifically for this purpose.

There are many reasons why an individual may want to encourage friends and family members to use their inheritance to travel.  In some cases, it’s about connecting with family history and the money comes with instructions to travel and learn more about their family heritage in another country.

In others, the person creating the trust wants to ensure that family members scattered across the country (or world) have the means to visit one another and build stronger family ties.  Still others may simply want their children and grandchildren to have the life-altering experience of discovering new cultures and languages.

In order for this to happen, the individual works with his or her Hinds County trust lawyer to put together a trust which has specific instructions for how the money is to be used and by whom.  Those instructions can become quite particular such as naming certain areas that the family is to visit; although this is not always the case.  Really, it’s all about the intentions of the client and what he or she wants for those left behind.

Because travel is generally considered a luxury, it’s something that people in Clinton may choose to set aside when they are working to pay the bills, cover their kids’ tuition, and save for retirement.  When a travel trust is in place, it suddenly opens up the possibility of travel for those who either don’t have the means or are “putting it off” until they feel financially able to indulge in something which might otherwise be considered frivolous or may only seem like a distant dream.

An experienced trust lawyer in Hinds County will be familiar with how to set up a variety of trusts to achieve your travel desires.   There are many things to consider, such as how strict to make one’s wishes, how to fund the trust, and how survivors are to be compensated.  For example, one client may actually decide to work with the lawyer and a travel agency to make arrangements while another will simply reimburse expenses after the travel has taken place.

Creating a travel trust with a Clinton trust lawyer is a great way for clients to develop their legacies by focusing on something which is not only important to them, but will most certainly impact the lives of those left behind.  It’s a matter of providing not just an opportunity for a vacation, but a true chance to make memories which will last a lifetime.

Estate Planning for College Graduates in Mississippi

By Ronald Morton | Leave a Comment

By the time you earn your college degree, you may not feel like you have anything to “protect” through estate planning.  After all, the stereotype of the “starving college student” got started for a reason!  But, even if you leave college with a load of student loans and an entry-level job (or hopes of one), you will do yourself a favor by spending just a little time doing some basic estate planning here in Clinton.

Clinton Estate Planning for Your Physical Self

There are tons of reasons to do your estate planning, and it seems like those most often talked about are passing on your possessions and avoiding taxes.  It can be argued, however, that there is a far more important reason, and it’s one that even young college graduates shouldn’t overlook: your medical decisions.

What happens if you become injured or otherwise capacitated and can’t tell the doctors what you want?  Who makes decisions for you about what kind of life-sustaining measures should be taken or whether or not you consent to surgery?  In most states, an individual’s parents are given this responsibility (although that is not always the case).  Whether you want your parents in that role or someone else, the way to make sure you have a say is to have an estate planning lawyer in Hinds County draw up a legally binding “medical power of attorney.”

Clinton Estate Planning for Your Finances

It may not seem like you have much of anything to look after when it comes to finances and the recent college grad.  In reality, though, you likely do have some things to consider.  For example, do you have any debt, and if so, do you know what happens to it if you become incapacitated or pass away?  The answer has a lot of variables such as the kind of debt, whether or not you have other authorized users on your account, and more.

One of the reasons you worked so hard for your degree was likely so you could move out into the workforce, and with that comes options such as retirement accounts and insurance.  Each of these includes naming a beneficiary for benefits, and you’ll want to make sure you are up to speed on what it means and have the appropriate people named.  Some accounts don’t have specific beneficiaries, so setting up even a simple will can help make the transfer of those funds much easier and less expensive when the time comes.

Clinton Estate Planning for Your Partner            

Many college graduates are moving forward with their lives as couples, both married and unmarried.  Either way, estate planning in Hinds County is an important part of making sure that your partner is cared for and receives the appropriate benefits upon your death. As mentioned above, you want to make sure you have the correct information filled out when it comes to beneficiaries on accounts, but you will probably want to go a step further to ensure that your assets pass in the way you want.  Typically, an unmarried partner is not entitled to the same benefits as spouses, so if you don’t set up the situation appropriately through well-reasoned estate planning, your significant other might be entitled to absolutely nothing!

Estate Planning Matters For College Grads, Too!

Contrary to what you may have heard, estate planning is just for the ultra-wealthy or the elderly.  Estate planning is just as important for the college grad and savvy young adult, too.   Celebrate your recent graduation and your success by getting a complimentary review of your situation. Schedule a Legacy Planning Session with the mention of this article and let us help you layout a road map for lasting protection and peace of mind in the future.

Figuring Taxes and Gifts into Your Clinton Estate Planning

By Ronald Morton | Leave a Comment

There are a lot of important reasons to spend time working with an estate planning lawyer in Clinton. In addition to making sure your wishes are clearly defined and legally valid, there is also the issue of saving your beneficiaries from paying excessive taxes on what they inherit.

In estate planning circles, the story of Sam Walton of Walmart fame is referred to often.  Because Walton and his lawyers were savvy, his family managed to inherit approximately $86 billion in stock without paying any estate tax.  This was possible because wills and trusts lawyers advised him on how to use gifts as a way to avoid many taxes.

The Magic Number

While things could certainly change, things are currently looking even better today than they were in his time. This is because individuals are now allowed to give away up to $5 million of their estate without having to pay what are known as “gift taxes.”  This is different from what it has been in the past and what may lie ahead in the future.

In order to take advantage of what is currently on the books, it makes sense to meet with an estate lawyer in Hinds County as soon as possible.  The attorney will advise you on what the current laws are both federally and in Mississippi.  You will also be able to get advice on how best to give gifts so that it impacts your estate for the better and limits the amount of taxes that will be paid out of the estate and by those who inherit from it.

A Widespread Reach

While $5 million is certainly a lot of money, it’s not inconceivable for many people to have significantly more in their estates than they originally think.  This is because your estate in Clinton includes everything you own, from your own personal residence to a business, as well as retirement funds, life insurance, and stock. Add to that the value of your vehicles, personal possessions, home furnishings, etc., and you can see how things do start to add up.

And just because $5 million is the current magic number doesn’t mean that it won’t likely be reduced considerably in the years to come.  An estate planning lawyer in Clinton can help you uncover the true value of your estate so that you can determine how to make gifts now that will benefit everyone involved later.

Estate Planning for Single People in Clinton

By Ronald Morton | Leave a Comment

Do single people need a will or trust attorney?  Yes!

Really, “yes” is the only answer that’s really needed, but we’ll go ahead and create a whole blog post to offer some insight as to why estate planning is important for singles and not just for families.

One of the most important reasons for a single person to work with a will and trust attorney in Hinds County is best understood when you think about the consequences of not planning.  Should you have a medical emergency or pass away, what becomes of you and your estate will be entirely up to the state of Mississippi.  This means that if you are unable to communicate your wishes, the state will step in and impose its own plan on your body and your assets.

Imagine that for a moment.  If you were to have a medical emergency and be unable to speak up, who would be able to tell the doctors what you would want?  Hopefully, that person would be one of your parents or siblings, because it’s pretty likely that they are who the courts would appoint on your behalf.  If the best choice would really be a good friend, other family member, or possibly a significant other to whom you’re not legally married, the courts won’t care.  They will stick to the predetermined law, and that law will look at bloodline relatives first.

This is also the case with your finances.  If you are unable to take care of your own finances for any reason, the courts will likely appoint the closest blood relative to step in.  It doesn’t matter if you don’t want your family in your private financial affairs or not.  They will have access to your money and will be put in charge of managing it, paying your bills, etc.  Think about how your oldest sibling manages his or her money.  Would you be comfortable with that person being in responsible for yours?

Along the same lines, should you pass away without an estate plan, your assets will automatically go through the Hinds County probate process.  Again, the courts will step in and determine who is to inherit your property and money; and you will have absolutely no say in the matter.  How excited would you be for Mom and Dad to inherit your laptop or for your siblings to be given the jewelry which, by all accounts, should go to your best friend?

None of these scenarios is even a little bit exaggerated.  This is exactly what happens when a single person in Clinton chooses not to work with an estate planning attorney.  Remember, it’s not just about having a lot of assets to leave behind; it’s about making your own decisions regarding your medical care, your possessions, and your finances.  Having a small estate now simply means that the planning process will be less complicated!