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Friday, December 8, 2017

Lessons That We All Can Learn From Others’ Messy Estate Cases

Summary: An estate that ends up spending extensive time winding its way through the court system is often something that is time-consuming, expensive and stressful for those involved in the case. While a dreadful thing for those involved, these cases many times do provide lessons to the rest of us. Particularly, cases that involve estates with no plans (and, therefore, intestacy) frequently serve as a reminder of the many potential benefits that can realized by taking control of one’s estate by creating a comprehensive estate plan that includes a will or a will and a living trust.      

Georges was a successful individual working in a major city in the Midwest, earning a six-figure salary. Georges and his wife, Lisa, married in 2007. They had a child together in 2009. At some point, Georges went out and purchased a life insurance policy. The value of the policy was equal to three years of his salary. On that policy, Georges named his sister, Emma, as the beneficiary.

In 2014, Georges and Lisa divorced. A year later, Georges died. Although Georges had engaged in a certain degree of planning (in the form of his life insurance policy purchases,) Georges had no estate planning legal documents and so he died intestate. Lisa filed to open a probate case and was named as the administrator of the estate. (Yes, this man’s ex-wife ended up as the administrator of his estate!)

While Lisa was able to assume control over the management of the estate, one area where she was not able to assume control was the life insurance policy. Emma, after the insurance company refused to pay, went to court and to obtain a judgment ordering the insurance company to pay the death benefit to her. Lisa fought against Emma’s receiving the insurance policy’s death benefit, asserting many claims in court, both the federal and the Illinois court systems. Both the federal and state cases were extensive, including decisions by trial courts and cases argued before appeals courts.    

Georges’s estate planning offers many potential lessons that can be learned from it. The first lesson is that intestacy is almost never the best answer. In this circumstance, Georges, despite being a man of some wealth, created no estate planning legal documents. When you create your own estate plan, you take control and make your own decisions regarding how you want your estate handled. You are the one who decides who will get your wealth (and in what portions.) You are the one who decides who will be the person who will handle your estate’s affairs after you’ve passed. These are just two areas in which you can take control with a comprehensive estate plan.

When you don’t create your own plan, it doesn’t mean you have no plan, it just means you have a plan that others have decided for you. Your assets are distributed according to your state’s intestacy laws, a pre-fabricated set of rules crafted by your state’s legislature (and likely enacted many decades ago) that tries to find your closest legal relatives and disperse all of your wealth to them. Your estate’s affairs are managed by whoever goes to court, files paperwork asking to be named administrator/executor, and persuades the judge to make that appointment. Clearly, while the first option gives you the ability to take total control, this option means that you have basically no control over what happens after you die.    

A second lesson is the importance of making sure you plan is “in synch,” which is one reason why periodic plan reviews are important. While, in Georges’s situation, his true desire may have been for his sister to get the death benefit on the large life insurance policy, some people get tripped up by failing to update their death beneficiary designations when they update other parts of their plan. For example, had Georges lived longer and gotten remarried, but failed to make any changes to his policy’s beneficiary form, his sister (and not his new wife) would still receive the life insurance payout.      

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan





Tuesday, December 5, 2017

How Proper Estate Planning Can Protect Your Assets and Guard Against Unexpected Claims Against Your Estate

Summary: Two of the many outstanding benefits of estate planning are that estate planning allows you to have control, and estate planning provides protection. By planning, you can control who gets your assets, you can control how much each person gets and you can control who gets nothing. With estate planning, you can also protect your intended beneficiaries by making sure that a long-lost blood relative doesn’t appear for the first time after your death and, by using the laws of intestacy, walk away with a portion (or all) of your wealth.

Multiple television outlets, including PBS and TLC, have shows that chronicle celebrities and other well-known people who seek to discover their personal ancestral roots. Genealogy research, especially when going further back in time, can reveal some shocking stories. Research from the 18th and earlier parts of the 19th Century revealed some colorful stories, including that some men led double lives complete with two wives and two families (each in different states.)

In the 20th Century, as things changed, the possibility for, and frequency of, those situations declined. Many families really did look like “Ozzie and Harriet” or “Leave It to Beaver.” But today, families’ stories and relationships are becoming more diverse. With that increased diversity, there can be the possibility of more issues and complications when it comes to estate planning.

Did you know that, in some states (like Minnesota,) a half-sibling is legally entitled to inherit in intestacy just as much as a full sibling? That is one reason why many people sought to prove that they were the children of a jazz musician named John Rogers. If the Minnesota courts had found them to be the children of John Nelson, then they would be the half-brothers and sisters of rock-n-roll superstar Prince and, because Prince left behind no will or living trust, they’d be entitled to receive as big a share of his estate as Prince’s only full sibling, his sister Tyka.  

In other states, like Florida, the law of intestacy expressly says that your half-siblings are entitled to exactly one-half of what a full sibling would receive.  

Just like in Prince’s case, leaving your legacy up to the rules of intestacy means leaving your legacy up to these types of statutory one-size-fits-most rules. There are many things that can go wrong. For one thing, a portion (or all) of your wealth could end up going to someone you barely knew, or didn’t know at all, if that person is able to file a claim and persuade the court that they are the legal child of your father or your mother. While a lot of us might imagine that our families’ relationships resemble the Cleavers, sometimes the truth is that things happen and secrets are kept, especially within families. And sometimes those secrets don’t even come out until after you’re gone, and can have a dramatic impact on the distribution of your assets.

For another thing, these rules do nothing to reflect your personal input or your personal life experiences. Say, for example, you come from a large family with full siblings and half-siblings. If you’re the last of the first “set” of kids, or the first of the second “set” of children, it is entirely possible that you could be closer (both emotionally and in terms of age) to some of your half-siblings that you are to some of your full siblings. Under intestacy, if you live in state with laws like Florida’s, each of your full siblings will get exactly double what each of your half-siblings get, regardless of the realities of your individual family.

With an estate plan including a will or a will and living trust, you can take control and you can customize the distribution of your wealth to match you preferences and desires. You can specify exactly who you want to receive your wealth and explicitly leave anyone who you didn’t list in your plan (including any and all long-lost half-siblings) exactly nothing.  You have the power over your legacy.     

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan


 
  

Joint Tenancy With Right of Survivorship | It May Be A Risky Idea if Not Used Properly

  
Summary: Joint tenancy with right of survivorship is a means of owning property. It can be a useful form of ownership in some situations. As a method for avoiding probate, however, this tool can create many problems. It may limit your flexibility as a homeowner to sell or refinance, it may expose your home to risk from legal judgments incurred by your joint tenant and it may create confusion regarding each person’s ownership interest. For avoiding probate, there are often better techniques, such as revocable living trusts, which can effectively avoid probate without the risk and loss of freedom.    

People have lots of ideas about how best to avoid probate. Obviously, people seek a plan that is as effective as possible. They also often seek options that involve a minimum of expense and complication. Sometimes, though, just because an option is the fastest or the cheapest, it doesn’t mean that it is the best.

One example of this is the type of ownership of property known as “joint tenancy with right of survivorship” (JTWROS). There are circumstances where this can be a useful tool. Using this as a form of estate planning geared to avoid probate, however, often isn’t a good idea.

There can be many problems with this type of estate planning. First off, creating a JTWROS means that whomever you’ve formed the joint tenancy with has certain rights as soon as you create the tenancy. For example, after you’ve created your JTWROS, you have to get your joint tenant’s approval to sell or to re-finance the house.

Additionally, it creates certain risk exposure. If your joint tenant gets sued and loses, gets divorced, or has any other judgment assessed against him/her, then your home could be involved in satisfying that judgment, which could even mean a forced sale of the home!

This type of arrangements can also lead to confusion. Take, for example, the case of a woman named Molly who lived in Tennessee. Molly and her husband, James, owned a property together. Three years after James died, Molly created a JTWROS with herself and her son, Darryl, as the joint tenants. One year after she created that JTWROS, in 2010, Molly signed another deed. This one gave all of her rights to the property to Darryl Jr. (Darryl’s son.)

In 2013, Molly died. What ensued was a prolonged court battle to determine who had what legal rights to the property originally purchased by James and Molly. Did the 2010 deed mean that Darryl Jr. owned the whole property? Was the 2010 deed invalid (since Darryl Sr. didn’t sign it,) meaning that Darryl Sr. owned the whole property? Or did the father and son now share the property as co-owners?

Ultimately, the case went all the way to the Tennessee Supreme Court, which concluded that, when Molly created the 2010 deed, she indirectly and effectively ended the JTWROS. The 2010 deed transferred her rights to Darryl Jr. and meant that the two men, from that point forward, co-owned the property as what’s called “tenants in common.”

When Molly created these deeds, was this outcome what she had intended? It is impossible to say for sure. What we can say for certain is that, at best, Molly’s plans accomplished her goals but only after years of court wrangling and litigation going all the way to the Supreme Court. At worse, her home was tied up in litigation AND her plans failed to accomplish her goals. Either way, it wasn’t a positive outcome.

Other options might have been more advantageous. A living trust might have been one possible superior approach. With a properly executed living trust that had the home funded into it, Molly could have initially designated Darryl Sr. as the intended recipient of the home upon her death. If she later decided to give the home 100% to Darryl Jr., she could have made that change simply by amending her trust. If she decided to leave the home 50-50 to Darryl Sr. and Darryl Jr., she could have done that, as well. Again, it would have required only a simple amendment to her trust.

There are many ways to avoid probate. The key is to work with knowledgeable professionals and make sure that the plan you pick is the best one for you.       


This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan


       
  


Friday, December 1, 2017

Estate Planning and the New Parent | 3 Things to Keep in Mind

Summary: The birth of a new child is an incredibly exciting time, representing joy, excitement and hope. As the parent(s) of a new baby, this happy event should also trigger another thought in your brain: the need to create an estate plan or, if you already have one, review and update your existing plan. There are many facets of estate planning where the addition of a new “bundle of joy” may be impacted and where proper planning can help you protect them even more. 

Here are just a few (four, to be specific) of the things you should consider when it comes to your new child and your estate planning:

(1)  If you don’t have a plan, get one! Obviously, you hope to spend a nice long period of many decades sharing love, laughter and experiences with your child. But much of estate planning is a case of “expect the best but plan for the worst.” Probably your first instinct as a parent is to protect your new baby. One vital way to protect your child is to make sure that, if you die prematurely, that your child’s care and protection is provided for. Your estate plan can do that. As part of your will, you can indicate the person (or people) that you want to serve as a guardian and care for and raise your child until she reaches 18. Because a will is where you indicate this guardian preference for your child, an estate plan for you, as the parent of a minor child, is exceptionally important. 
(2)  Make sure that your will and/or living trust are financially structured to protect your child. Chances are you have high expectations for your child. You expect that she’ll grow to be a careful, responsible and reliable adult… and she probably will. But, we all remember being 18, right? Expecting an 18-year-old to manage a large amount of wealth in a wholly responsible manner completely on her own is a lot to ask, even of a “good kid.” To ensure that your wealth benefits your child to the fullest extent possible, consider the use of trust planning. With a trust, you can make sure that your child doesn’t have to deal with receiving the full distribution immediately upon turning 18. You can dictate the dates of distributions based upon various events, like, for example, college graduation, a 25th birthday or marriage. You can also make sure she has help, as the trust will have a trustee, whom you’ve named and whom your trust, who will manage the trust assets until they are fully distributed to your child.
(3)  Make certain you’ve reviewed ALL of your assets. You can engage in careful estate planning, complete with a trust that staggers distributions to your child from age 18 to age 30. However, if you’ve not made sure to review all of your assets, you could still have a problem. You know that $500,000 life insurance policy with your son’s name as the beneficiary? It all goes to him immediately upon his 18th birthday, unless you’ve planned and taken action. If you change the beneficiary form on that policy to name your son’s trust as the beneficiary, instead of him individually, then the entire death benefit goes into the trust and is subject to the same delayed payout schedule as the rest of your assets.        

You probably have a million things on your “to do” list right after you’ve had a new baby. While estate planning may not seem pressing, it is important not to overlook it. There are many areas where prompt and proper estate planning can help you protect your child and give you the peace of mind that comes from knowing that, even you’re not around, you are still providing for your child.


This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan





Tuesday, November 28, 2017

When Your Children Don’t Want Your Stuff | Estate Planning For Collections and Assets with Sentimental Value


Summary: Estate planning can involve balancing many, and sometimes competing, objectives. On the one hand, you may desire to set up a plan that leaves your wealth to your children. On another hand, you may have certain cherished items that hold high sentimental value to you but little to your children. With a careful and detailed plan in place, you can meet both of these goals, distributing the bulk of your wealth to you children while, at the same time, ensuring that your sentimental pieces go to people who will keep them and value them as much as you do.   

Earlier this year, the Christian Science Monitor published an article about an issue as old as humanity itself: the very different perspectives that can exist between an older generation and a younger one. More specifically, though, the articles touched upon a very modern problem: the relatively large volume of possessions held by Baby Boomers and the difficulties they face when their children and grandchildren don’t want those things.

Dealing with this dilemma can be complicated. It is understandable and reasonable that the younger generations, many of whom may live in small abodes, might have no place in their homes – and lives – for their parents’ and grandparents’ collections of paintings, ceramic figurines and thimbles. Nevertheless, having these possessions rebuffed can be difficult as, for the older generation, those things usually hold high sentimental value and the thought of those cherished items ending up in a yard sale, flea market or thrift store can be excruciating.

As with many circumstances, though, there may be a solution available through estate planning. With no planning, all of your possessions pass according to what’s called the “intestate succession” rules set up in your state’s statutory law. If your spouse dies before you do, that often means that all of your assets go to your children. This one-size-fits-most plan for asset distribution has many potential pitfalls, even if you do desire to leave the bulk of your wealth to your kids.

One of these traps can relate to your collections. Let’s say that you outlive your spouse and that you desire to divide your assets among your three children. However, among your possessions are your antique china service for 12 and your husband’s vintage vinyl albums from the 1950s and ‘60s. For this example, let’s also assume all of your children have stated that they have no interest in vintage records or antique dinnerware. With no plan, everything you own, including that china and those albums, will go to your kids. What’s probably going to happen to the china and vinyl? The likelihood of that “yard sale, flea market or thrift store” outcome seems pretty high, doesn’t it?

With a careful estate plan, though, you may be able to avoid this unfortunate ending. Perhaps you have a niece who loves antique household goods, like china and crystal, and has always adored your china set. Maybe you have a trusted and helpful neighbor who is a self-described “hipster” and loves all things “retro” when it comes to music, including old-fashioned turntables and vinyl albums. Your detailed estate plan can state that, while your children split the vast majority of your assets, the china goes to your niece and the albums go to your neighbor. This type of planning can be accomplished either with a will or a living trust. With a basic will, you can simply include paragraphs indicating the special distribution of those specific collections to your preferred beneficiaries. If you desire to avoid probate, you can do the same with a living trust. With your trust, stating your intent regarding distribution of these assets works similarly. The only additional necessary step is to make sure that you have funded these assets into the trust’s ownership. That is typically done by listing these assets in a special document within your trust, often labeled as “Schedule A” (or something similar.)

By engaging in this type of planning, you will have left a legacy in two parts: you will have both provided for your children and you will also given a second life to your antique/vintage collections, ensuring that they go to homes with people who with treasure them as much as you do.     
This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan


https://www.youtube.com/channel/UCx9HBYFIYdohfnrfW_XRkIQ           



Thursday, November 23, 2017

Estate Planning to Achieve Your Unusual or Non-Traditional Estate Planning Goals

Summary: Everybody’s estate plan is a different from others’, to one degree or another. Many people have specific, unique or peculiar goals they’d like to accomplish through the legacy they leave behind. By obtaining a detailed and comprehensive estate plan, you can take full advantage of the law’s opportunity allowing to control your legacy and make sure that all of your planning objectives, both great and small, ordinary and unusual, are achieved. 

We all have our quirks -- those little peculiarities that make each of us unique. Our quirks can play a role in many things that we do, including, sometimes, how we go about planning our estates. Some of us may have rather ordinary estate planning goals, such as splitting assets between one’s immediate family and/or closest friends. Other people have goals that are more… unique.

The man who invented the Pringles potato chip can left instructions that, as part of his final arrangements, he should be cremated and part of his ashes should be buried… inside a Pringles can. An aristocrat from Portugal who died in 2007 had an unusual plan, not for his final arrangements, but for the distribution of his assets. He had no spouse and no children but lots of wealth. The aristocrat underwent the proper procedural steps such that, when he died, his wealth went to… 70 strangers whose names he selected from a telephone book.

A wealthy 19th Century man from Ohio decided to leave much of his estate for the benefits of animals. Specifically, according to a 2013 report in the Naples, Florida newspaper, his plan called for his wealth to be put toward the creation of a house for cats that was “complete with dormitories, an infirmary, a rectory, rat holes, roofs for climbing and areas for ‘conversation.’” There was even an auditorium where the cats could listen to live accordion music. Famed 1960s signer Janis Joplin had a much less elaborate but decidedly unusual estate planning goal: her plan set aside the sum of $2,500 for a rousing funeral party – a “final gesture of appreciation and farewell.”       

Chances are, your estate planning goals aren’t as exotic as a resort home for felines or leaving your wealth to strangers you’ve chosen at random. Nevertheless, it is entirely possible that your planning goals do include some highly personalized elements. Maybe you have some very particular asset distributions you want to make to specific beneficiaries. Perhaps you want your family to have the bulk of your wealth, but you want your mail carrier to have your collection of “joy buzzers” because you know he’s a hug aficionado of novelty toys.

Alternately, maybe you have specific and detailed desires for your final arrangements. Some people just want to express their wishes for where they will be buried and/or who will deliver the eulogy. Other people desire to script almost everything from eulogies to pall bearers to music to… nearly everything associated with their funeral and final arrangements.

Whatever your specific or unusual goals are, your comprehensive and detailed estate plan is the way to make sure those objectives are carried out. With a detailed will or will and revocable living trust, you can take control of your legacy and ensure that, even if you have very unusual estate planning goals you want to accomplish, those goals can be realized.

Your plan helps you in two ways: it expresses your intentions and helps prevent your loved ones being left “in the dark.” Sometimes, the loved ones you leave behind may fail to do exactly what you want, not because their reject your wishes, but because they don’t know exactly what your preferences are. With your plan, you can save them the stress that often comes with uncertainty. Your passing will be difficult for them. It will be even more so if they have to guess what your estate planning preferences were.

Your plan also avoids the perils of intestacy. If you leave no plan, then the law will simply look for your closest legal relatives (meaning, typically, a spouse and/or children) and divide everything you own amongst them. If your desires deviate from that cookie-cutter type approach in any way, then you need a plan. Your plan can ensure that you not only provide for your spouse and/or kids, but that all of your goals relative to all of your assets can be realized, even if those objectives are unique or unusual.       

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com


This article written and published by:
8039 Cooper Creek Blvd
University Park, Florida 34201
844.306.5272 (Phone)
@assuranceplan
#legacyassuranceplan


https://www.youtube.com/channel/UCx9HBYFIYdohfnrfW_XRkIQ