April is Financial Literacy Month. Financial literacy is crucial in the estate planning process, which is why we want to take the time to blog about it! You may be asking yourself, what is financial literacy? Financial literacy is knowing and navigating your personal finances. This includes budgeting, saving, effectively managing money, and planning your future expenses. [Read more…]
Top Ten Estate Planning Mistakes You Can Make During Covid-19: And How You Can Avoid Them – Part 2
This is Part 2 of the Top Ten Mistakes blog series. Click here to catch up on Part 1.
In our last blog, we discussed the first four mistakes you can make: Procrastination, assuming wills or trusts avoid probate, leaving assets to a child or special needs beneficiary (directly), and assuming trusts take away beneficiary control. Today we’ll look at the next three.
Mistake #5: Not Organizing Your Information During the Pandemic
Have you organized all your financial records, deeds, tax information, insurance information, and estate planning documents in one secure place or central location? Does your family know where that is? Do they know what medications you take or who your doctors are? How about your lawyers, accountants, or financial planners? These are all things you might want to consider at any time, but they are especially critical now during this pandemic when things can change quickly.
If your financial information and records are not organized before death or disability (by you, the person who knows where everything is), your loved ones can be left with a morbid scavenger hunt trying to find and recreate financial information and records during an emotionally difficult time. This may keep them from being able to make timely, important financial decisions. Your family will not be able to handle your affairs, take care of you, or advocate on your behalf during the pandemic if they can’t find your information or do not have legal authority to do so.
The solution to this mistake is to work with an estate planning attorney who has an ongoing care program. Here at Family Estate Planning Law Group, our initial intake process helps you to identify all your assets as well as the team of professionals that you work with. We then track any changes because it doesn’t matter what you own today; it matters what you own when you die or become incapacitated.
In addition to working with an attorney with a client care program, we also suggest having a Family Care MeetingTM where you invite your caregivers (children) and your professionals (financial planners, CPAs, etc.) to discuss your plan so everyone understands how it will work.
Finally, we love the “Grab and Go” Kit suggested by Healthassist which you can check out here. It’s a list of things you might want to have readily available in case you get suddenly ill and have to go to the hospital during this pandemic. [Read more…]
Top Ten Estate Planning Mistakes You Can Make During Covid-19: And How You Can Avoid Them – Part 1
We’ve been talking a lot recently about the mistakes we see in estate planning because now, more than ever, we are finding that people feel uncertain, and they want to know their loved ones are secure. Despite the best of intentions, sometimes estate plans just don’t work because they were not set up or maintained properly (or you never had one to begin with). While we all want to feel good about our planning, we also want to make sure it is not a false sense of security. The next few blogs will address the mistakes we often see, and how you can make sure that you don’t fall prey to them!
Mistake #1: Procrastination
One of the biggest and most common mistakes that we see in estate planning is procrastination. For many, creating an estate plan (or updating the one they did 15 years ago) is something they are always meaning to get to but never actually do. The biggest mistake you can make is not having an estate plan, because the probate court has one for you. And for those who do have a plan, their biggest mistake may be not having looked at it in years. Changes in the law, changes in what you own, family changes, job changes, changing your residence, and changing your wishes can all keep an old plan from being effective if it is not updated. In our experience, most estate plans fail because they do not reflect what you want to have happen now.
The solution to this mistake is simple: create an estate plan or update your existing estate plan. Even if you are not quite sure who you want involved or the exact details you want to be included in your plan, someone who specializes in estate or elder law planning will be able to help you with that. Additionally, if you work with a firm that has an ongoing care program, you can always update your plan if you change your mind or if your situation changes. [Read more…]
Socially Distanced Signings
During these unique and unprecedented times, we at Family Estate Planning Law Group are still working hard to help our families create estate plans and update their estate plans efficiently while also focusing on keeping everyone safe through social distancing practices. With the new stay at home order extended to May 18th, we have come up with several options to help our clients efficiently and safely review and execute their estate planning documents until it is safe for us to start in-person meetings again. [Read more…]
Preparing Your Business for After You’re Gone
If you have a business, you have likely thought about what would happen to your business after your death. A well-run, well-managed family business could potentially provide for your loved ones long after you are gone. Unfortunately, according to the Family Business Institute, less than one-third of all businesses survive into the second generation. The reason for this is largely due to a failure to plan for the future on the part of the owner of the business. Business succession planning is like writing an estate plan for your business. Few people are enthusiastic about estate planning, but most adults do recognize the wisdom in doing so.
If you have poured your time and energy into your business, you want to make sure it succeeds you. What you don’t want is your death to cause infighting among family members, and you certainly don’t want your business to collapse or end up in liquidation. In a best-case scenario, you will have planned so thoroughly for your business succession that every family member will know his or her role in the business, and the business will continue, as strong as ever. [Read more…]
Myth Busters – Pt 2 (The Probate Falsehood)
In our last post, we busted two of the three most common estate planning myths about only the rich needing estate planning and that you don’t need to plan because your spouse will get everything. If you didn’t catch that post, give it a read to learn why those statements are totally false! Today, let’s bust the third and fourth most common myths.
What Happens to a Business When the Owner Retires?
Many business owners can’t imagine a life without the business they built, so they often postpone planning for their own retirement and the sale or transfer of the business. That doesn’t work out well.
There are steps to take when business owners decide to actively engage in planning for their business to continue to thrive after they step down. This article from Forbes, “Eight Factors to Consider before Retiring from Your Business,” offers some useful tips. [Read more…]
Adding a Child to a Deed Seems Simple, but Might Have Negative Consequences
People, who own their own homes, especially when the mortgage is paid off, often think they should add their adult child or children to the deed so the asset passes to their heir(s) without going through probate. However, this seemingly simple step could lead to a few issues, one of which is making you ineligible for Medicaid for a period of time. That is just the beginning, as reported in a recent article from nj.com, “The risks of changing your home’s deed.”
Make the Most of Your Money in 2018
Why not spend some time now, while the year is young, taking the steps that will bring you closer to your financial goals for 2018 and beyond? Kiplinger has some great pointers to share in the recent article, “12 Smart Financial Moves for the New Year.”
1. Increase your retirement-savings contributions. If you’ve been maxing out your 401(k) or are turning 50 this year, up your automatic contributions to take advantage of higher limits and catch-up opportunities. You should also set up automatic monthly contributions from your bank account or paycheck into an IRA. This will allow you to save before you have an opportunity to spend it.
2. Make a charitable-giving plan. When you earmark funds for charity, think of the ways you can contribute—by writing a check, giving appreciated securities, giving to a donor-advised fund, or making a tax-free transfer from your IRA (if you’re older than 70½). Ask your estate planning attorney how the new tax law may impact your charitable-giving strategies.
3. Make the most of the new tax law. Speaking of the new tax law changes, look at how it may affect your charitable giving, IRA conversions, home-equity loans, medical-expense deductions and 529 college-savings accounts. There are some key financial strategy changes. Speak with your estate planning attorney to learn if there are new opportunities for your estate plan. Don’t miss out!
Siblings Challenging How their Outdoor-Loving Brother’s Estate is Being Managed
Outdoorsman Carl Bergstresser made it very clear by signing a will, days before he died in July 2016, that stated that he wished his 11.6 acre property, located on the Braden River to be maintained in perpetuity as a nature preserve.
The Sarasota Herald-Tribune reported in its recent article, “Outdoorsman’s siblings contest how trustees managed his estate,” that Bradley Magee, the attorney who drafted the will, said the Osprey-based Conservation Foundation of the Gulf Coast assumed ownership of the land. However, Bergstresser’s dying wish remains the subject of a prolonged legal battle. This question is further complicated by the uncertain outcome of an effort by Manatee County to acquire adjoining land from a developer to create an even larger nature preserve.
Bergstresser’s siblings, Diana and Phil Bergstresser, brought a probate court case that questions how the executors of their brother’s estate managed the assets which he left in addition to his homestead. They claim they’ve been deprived of most of the assets that would’ve remained in the estate, other than the donated land. Aside from his home and land, Carl’s estate is valued at $314,516.
Dated July 16, 2016, Bergstresser’s will states: “My homestead and all acreage owned adjacent to my homestead shall be donated or otherwise transferred to a nonprofit organization or government entity that will maintain such property for wildlife conservation and general conservation purposes on a perpetual or long-term basis.”
Bergstresser permitted his “personal representatives” named in his will—Magee, Phillip St. John, and Donald “Troy” Smith—to choose the nonprofit that would receive his property. The trustees paid a $32,000 mortgage and a $59,000 line of credit that Bergstresser owed from his remaining estate. The siblings say the will doesn’t state that Bergstresser wanted the debt paid out of the money that otherwise would’ve gone to his heirs and that his executors made the payments “without getting a court order.”
Their lawyer also claims the executors took $46,000 from the estate for their “personal representatives’ fees” and about $66,000 for attorney fees—an amount of attorney fees paid by the estate they feel is “excessive.” He also said the court ordered the foundation to return $47,000 to the estate that the trustees paid it as a “stewardship fee” for costs from the closing on the property and putting it in a conservation easement.
Another unknown is an effort to get Manatee County to acquire 32.38 adjoining acres for which a developer received approval for a subdivision. When initially proposed, residents in the neighboring area strongly objected. They argued that the heavily wooded site on the Braden River is an oasis for an abundance of wildlife. They asked the county to acquire it for a nature preserve.
The developer granted the Conservation Foundation an option to buy that land for $3 million, and the foundation is willing to transfer that option to the County.
When Bergstresser learned that he was terminally ill, he decided that he wanted his land to be part of the proposed Braden River Nature Preserve. Now that the foundation has ownership of his property, it will classify it as a “conservation easement” and it will be preserved as he had wished.
Reference: (Sarasota) Herald-Tribune (December 15, 2017) “Outdoorsman’s siblings contest how trustees managed his estate”