April 3, 2018February 23, 2022

Advice for Widows and Widowers

It is not easy losing a spouse. However, widows and widowers do not have to let dealing with financial issues overwhelm them.

When people anticipate that their spouse will pass away, they often have a very difficult time handling everything afterwards. The grief that comes with the loss can make other things seem overwhelming, even for those people who have thought ahead and made careful plans. Things are also much worse when a spouse passes away unexpectedly.

If the deceased spouse was the one who handled most of the financial issues for the couple, things can get even more difficult. However, widows and widowers should not let financial issues bother them too much, as the Green Bay Press Gazette explains in “Financial planning tips for navigating loss of a loved one.”

The truth is that most financial decisions are not nearly as urgent or important as they are often made out to be. Widows and widowers do not have to make any financial decisions, until they are forced to do so. They should not make those decisions before. They should put off as much as they can, until they have had a chance to properly mourn the loss of a spouse.

Financial decisions do not have to be made alone either. If an attorney is helping with the estate administration, the attorney can make sure that all necessary estate financial matters are taken care of and suggest a professional to help with other things.

Things do go much better for widows and widowers, when the deceased spouse has made proper estate planning arrangements. Having an estate plan will greatly help your spouse, if something happens to you. Learn about the fundamentals of estate planning for Profit Law Firm.

Reference: Green Bay Press Gazette (March 9, 2018) “Financial planning tips for navigating loss of a loved one.”

April 2, 2018March 27, 2024

Cloning and Estate Planning

As far as anyone knows, there are not any clones of humans walking around yet. However, it might soon be possible. That could have some interesting effects on estate planning.

The idea of cloning humans has been a science fiction staple for a long time. The original premise was that an exact genetic match could be made with all of the knowledge, memories and personality of the original human reproduced in the clone.

The reproduction of things learned after birth is not likely anytime soon, so an almost identical genetic clone might be far off. America recently learned that Barbra Streisand had successfully cloned one of her dogs twice as The New York Times reported in “Barbra Streisand Cloned Her Dog. For $50,000 You Can Clone Yours.”

It is likely that some scientist somewhere will set aside ethical concerns and figure out how to clone humans. That could have a profound impact on estate planning. There is currently no legal status for clones.

Someday, the laws of intestate succession may need to determine whether clones have an equal or greater or lesser priority than children. It also might make a difference when and by whom the clone was made.

Science has never had a major impact on estate planning. The possibility of cloning and the possibility of “eternal life” that other researchers are working on could soon change things.

Reference: New York Times (Feb. 28, 2018) “Barbra Streisand Cloned Her Dog. For $50,000 You Can Clone Yours.”

March 27, 2018February 15, 2024

IRA Inheritance Options

Deciding who should inherit your retirement account is an important part of estate planning. You have several options that are available.

When many people pass away, they will still have a lot of money in their individual retirement accounts for a beneficiary to inherit. It is important to decide who that beneficiary will be, in a way that fits your overall estate plan. Contact an estate planning attorney to figure this out.

The IRA can be used to balance out other bequests and can be used to enhance other estate planning goals. Depending on what you decide to do, there are various tax implications, which Morningstar recently discussed in “Who Should Inherit Your IRA?”

Options include:

Spouse – If your spouse is the beneficiary, he or she can roll your IRA into their own. However, it might not make sense to designate a spouse, if they are nearing the age of having to take required minimum distributions and will not need the money.
Child or Grandchild – If they inherit the IRA, then they can stretch the benefits out over their own lifetimes. However, as a practical matter, few do so because they need the money.
Charity – Your estate can get a tax deduction, if you leave your IRA to a charity. It can be complicated, so get expert advice before filing out a beneficiary designation form.
Your estate – There is not much benefit to naming your estate as the beneficiary. However, if you cannot decide on another option, you can do so.
A trust – Ordinarily, there is no benefit to leaving your IRA to a trust. However, if the beneficiary would otherwise be a minor child or unable to manage their finances, it might be necessary to do so.

Reference: Morningstar (March 2, 2018) “Who Should Inherit Your IRA?”

March 16, 2018October 25, 2023

Hidden Costs of Probate

People will often go to great lengths to make sure that their estates do not have to go through probate. They often fail to take little steps and find themselves in probate unnecessarily for other reasons.

Probate is often thought of as something that happens after a person passes away. If a person has not planned to avoid probate, then the estate must go through probate for administration before any assets can be distributed to heirs. What many people do not realize, is that probate courts handle more things than just wills.

Consider the case of one elderly couple in Arizona. The wife suffers from dementia. She had a modest retirement account of $25,000. Her husband wanted to withdraw funds from the account to pay her medical bills. Before he could do that, he had to go through probate court to be appointed his wife’s guardian and conservator. In the process, he incurred $6,000 in attorney’s fees as WLTX19 reports in “Man spends thousands in probate costs to help wife with dementia.”

This unfortunate situation can often be avoided. Estate planning attorneys do more than just help their clients’ estates avoid probate, after the clients pass away. They also help people plan for end-of-life care and what will happen should they ever become incapacitated and can no longer look after their own affairs.

If you have not planned for this, then visit an estate planning attorney and ask about a general durable power of attorney. That document will let you appoint someone to look after your finances, if you become unable to do so.

Reference: WLTX19 (Feb. 15, 2018) “Man spends thousands in probate costs to help wife with dementia.”

March 15, 2018

Treating Children Equally When One Is Not Responsible

Most parents want to treat all their children the same in their estate plans. That can be difficult, when one of the children is not very responsible with financial matters.

Every parent with multiple children knows that despite being raised the same, they all turn out differently. They have different abilities and often very different attitudes about things.

Children also have different levels of financial responsibility. Nevertheless, most parents do want to leave all their children an equal inheritance and they do not want to offend one of them by treating them differently than the others. This was the dilemma of a woman who recently wrote into Market Watch for advice in "My son is responsible, my daughter is in debt — how do I split my estate?"

A common way to do this is to create an estate plan that limits how the trust assets can be used. Provisions can be written into the trust, so an irresponsible child cannot waste any money received on frivolous things. This is unlikely to offend any responsible children, if they use the money in reasonable ways.

Not all families are the same. The best way to get an estate plan that covers your unique family situation, is to visit with an estate planning attorney. Let the attorney develop the best way to distribute your estate, given the needs of your family.

Reference: Market Watch (Feb. 16, 2018) "My son is responsible, my daughter is in debt — how do I split my estate?"

March 12, 2018

Planning for Accident or Illness

It is impossible to know whether you will ever have an accident or have an illness that will leave you incapacitated. However, you can easily plan for dealing with it should it happen.

Most people generally understand that the older they get, the more likely they are to suffer from cognitive decline because of Alzheimer's or some other form of dementia. As people get older, they often begin to prepare for what will happen if their time comes and they become incapacitated.

What people do not think about is that elder dementia is not the only way people can become incapacitated. There are no age requirements for disabling accidents or illnesses. Everyone, no matter their age, should plan for what would happen if they are incapacitated. It is not difficult to do, as TC Palm discusses in "Be as prepared as you can by planning for incapacity."

To get started, schedule an appointment with an estate planning attorney. The attorney can prepare the necessary documents for incapacity.

You will need a general durable power of attorney, so someone else has the authority to handle your day-to-day finances. A health care power of attorney will allow someone else to make your health care decisions. A living will lets you decide ahead of time what medical means can be taken to prolong your life.

Consider taking another step at the attorney’s office and get an estate plan, just in case an accident or illness does more than incapacitate you. A thorough estate plan prepares you and your loved ones for illness and death.

Reference: TC Palm (Feb. 20, 2018) "Be as prepared as you can by planning for incapacity."

Building Legacies that Last Estate Planning and Elder Law

Tag: Prince George’s County Estate Planning