Picking a guardian for your child whether you are expecting or already have young children can be an emotional process. Trying to pick a family member from one person’s side or the other can cause tension or make you feel like you’re “picking sides”. Having a new baby and having children is a joyful yet challenging time. Naming the guardian(s) of your children shouldn’t be something you feel guilt over. Most assume that they must pick a family member, but you can actually name whomever you feel will be the best fit. In a Business Insider article, former financial advisor and mom, Katie Oelker, shares how she and her husband made the decision to pick guardians for their daughter and later daughters, before each child was born, and how they ultimately picked friends instead of family.
If you’re going to be a first-time parent or you already have kids, we know you’re ready to take on the world to protect your child(ren). Yet, many parents forget that estate planning is a critical element in caring for your child, and that your estate plan must be regularly updated to account for additional children, newly acquired assets or changes in family dynamics. The Motely Fool lists some estate planning steps to take in their article, “If You’re a New Parent, Take These 4 Estate Planning Steps”, so you can rest easy knowing your children are protected even if you’re unable to be there for them.
- Get Life Insurance – Life insurance is a fantastic financial tool you can use to ensure that your partner and child will be taken care of financially if you die. Buying life insurance provides funds that your partner will be able to use to support themselves and your child now that they are a one income home. In the tragic event that both you and your partner die, if your estate is properly planned, the funds can be used to raise your child and perhaps help fund their education.
We know your first priority in life is always to protect and care for your family. Yet, there may be a day, that you can’t predict when you are unable to do so. The best way to be positive your family is protected whenever that day comes is to have an estate plan.
Estate planning when done right is not about documents and wills, it’s about your family. And to truly take care of your family you need estate planning beyond documents, you need an estate planning attorney that goes beyond simply creating documents. They need to understand the client and their family dynamics, they need to understand each asset the client owns, who controls it if you are disabled and who will receive it upon death, and the client’s goals, wishes and dreams. The attorney must communicate in plain English how the plan will achieve this holistic planning. Most importantly, your plan can’t be static, as you go through life you will experience changes and so too should your estate plan.
An article from The University Herald, “The Challenges and Complexities of Estate Planning for Blended Families, ” clarifies some of the major issues that blended families face. When creating or updating an estate plan, the parents need to set emotions aside and focus on their overall goals.
Estate plans should be reviewed and updated, whenever there’s a major life event, like a divorce, marriage or the birth or adoption of a child. If you don’t do this, it can lead to disastrous consequences after your death, such as unintentionally leaving all your assets to an ex-spouse.
If you have children from previous marriages, make sure they inherit the assets you desire after your death. When new spouses are named as sole beneficiaries on retirement accounts, life insurance policies, and other accounts, they aren’t legally required to share any assets with the children. [Read more…]
If your estate planning attorney and accountant have two very strongly diverging opinions about your trusts, it’s possible that your family trusts are no longer solving a problem, advises an article from Forbes, “Why You Might Need To Fix Your Family Trusts.” This happens for a few different reasons:
An executor who refuses to sell an inherited home, is opening themselves up to legal actions. Beneficiaries have rights, and one of those is to have an executor fulfill his or her legal obligations.
Nj.com’s recent article, “What happens when siblings can’t agree about selling parents’ home” explains that even though an executor has some discretion in administering the estate, they have a duty to settle and distribute the estate expeditiously and efficiently for the best interest of the beneficiaries.
Unless the parent’s will has specific instructions for the home, the executor—at their discretion—has two choices. They may sell it and distribute the net proceeds. The other option is to distribute the home “in kind” to the beneficiaries. That means retitling a deed from the estate to the beneficiaries as tenants in common. If the property is distributed in kind, the beneficiaries will then own the property jointly and will be jointly obligated on the home equity loan. State law may dictate that this loan isn’t not paid off with other estate assets, unless specifically instructed in the will.
When siblings are able to work together to settle their parent’s estate, it may take a little extra time and there may be some negotiating. However, the details are worked out. Sometimes the family bonds become even stronger. There are also ugly stories where families are fractured.
This occurs when the executor acts with some (or a great deal of) self-interest, especially when it’s one of the siblings. One child may feel entitled to more than an equal share, because of the care they’ve given the parent or any of a number of other reasons.
Nj.com’s recent article, “Your rights when family fights over a will,” explains that executors and trustees serve in a fiduciary capacity. It means they have a legal obligation to act for another (the beneficiaries) in a fair, honest, and transparent manner. While executors and trustees have the legal authority to manage the affairs of an estate or trust, they are still accountable to the beneficiaries and must inform them of what they’re doing.
A recent article from Think Advisor paints a dismal picture of Americans who are just not preparing themselves for the inevitable facts of aging. The article, “Now You Can Add Long-Term Care to Death and Taxes,” says this may be one of the biggest disconnects in the USA: the gap between how many Americans will need long-term care versus what people actually think they’ll need.
Just 46% think they’ll need it, according to a new studythat surveyed 2,000 people to see how prepared Americans were for the realities of long-term care.
Another misconception is the out-of-pocket cost of long-term care. The study found that the actual out-of-pocket cost of long-term care is more than $47,000. However, many Americans think it’s about half that, $25,350.
In addition, $47,000 is the low end of the scale for the yearly cost per stay. While some assisted living costs may be $45,000, semi-private nursing homes are closer to $85,000. Private nursing home care is $97,455, according to the study, which was conducted by Digital Third Coast. The study was made up of 57.7% males and 42.3% females, while 56% were age 35 and younger, 33% were 36 to 55 years old and 11% were 56 and older.
If you have given some thought to who should have guardianship over your child you’ve probably realized what a tough decision it is. Picking a person that both you and your spouse can agree on is no easy matter. Here are some tips from Savvy-Parents in their article, “Six Tips for Choosing a Guardian for Your Child”:
While we all see estate planning as a long-term strategy, which it is, it also can be for short-term items as well. It is easy to focus all your energy on the aspects of your estate plan that are far reaching, like retirements savings and what will happen to your assets after your passing. Yet, what about in those moments before your strategy for the longevity of your assets kicks in? Or more importantly, if you have minor children, what will happen to them in the first few days after your passing? An article from Forbes, “What Is Micro Estate Planning And Do You Need It?” emphasizes the need to consider the short-term plan for your children.