Legacy Assurance Plan Article | Avoiding Probate: A Variety of Tools Can Help You Reach Your Goal

Summary: Many people have avoiding probate as one of their estate planning goals, for good reason. Many of those desiring to avoid probate have become somewhat familiar with revocable living trusts, which are an effective means for avoiding probate. However, multiple other tools exist for avoiding probate, including pay-on-death or transfer-on-death financial accounts, life insurance, annuities and, in some states, transfer-on-death deeds. Each option has a unique set of advantages and limitations. A qualified legal professional can help you decide which is right for you.

Many people who have given thought to estate planning have heard about the numerous benefits of avoiding probate. While some states have created types of probate administration that are faster and easier, other states' probate processes are almost always long, expensive and exhausting for your loved ones. Probate can also cost you privacy. Anyone interested now knows extensive details about the estates of famous celebrities like James Gandolfini and Philip Seymour Hoffman because those men did not have an estate plan that avoided probate.

One well-known means for avoiding probate is the revocable living trust. These trusts can be great tools for accomplishing your probate avoidance goals, because the trust serves as a legal entity that (if all the proper steps are taken) owns assets for you, meaning that, when you die, your wealth is managed through the trust instead of your probate estate. Living trusts can also provide other benefits, such as ensuring the continuity of the management of your assets if you become mentally incapacitated. With a trust, your successor trustee can, in most cases, seamlessly take over these management duties without the need for a guardianship or conservatorship court proceeding, which can be stressful and time-consuming.

But, did you know that revocable living trusts are not the only way to avoid probate? In some cases, you may be able to own millions of dollars of assets and not need a trust to avoid probate. Life insurance policies and other insurance products (like annuities) have death beneficiary designations on them. Many bank, investment or other financial accounts can be structured to have "pay on death" or "transfer on death" designations placed on them. Some states have transfer-on-death deeds, which allow you place a death beneficiary on real estate that you own in those states. Other states recognize the enhanced life estate deed, which is somewhat similar to a transfer-on-death deed in that the property covered by that deed passes, upon the death of the owner, to a named beneficiary without the need of a probate administration. In each of these cases, the process of placing those assets into your beneficiaries' hands is simple, requiring only the death beneficiary paperwork, proof of the beneficiary's identity and a copy of the death certificate.

These death beneficiary accounts are not without their own risks, though. They will not provide any protection if you become mentally incapacitated. Additionally, if you desire to make major changes to the distribution of your wealth (perhaps due to a divorce or remarriage,) you must take care update each individual beneficiary designation. 

In the end, only a trained estate planning legal professional, working in partnership with you, can help you decide which path works best for your goals and needs.  

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Estate Planning for Your Animals: Beyond Just Cats and Dogs - Legacy Assurance Plan

Anyone who has (or has had) animal companions in their lives know the important role these creatures play in the lives of their human companions. In the past, a person might have a cherished animal companion euthanized and buried with him or her. Today, as we have come to recognize such notions to be cruel and inhumane, there is a greater emphasis on ensuring the continued care of your beloved "critters" if they outlive you. This type of planning is especially important if your animals are not just house pets.  

One such scenario where this is true involves horses. Whether your horses are expensive Arabians or just working members of your family farm, ensuring their continued care is important, as re-homing horses is often more difficult than re-homing cats and dogs. As with any type of estate planning, advance thought and communication are key. By engaging in advance planning and discussions with your loved ones, you can identify who is best suited to take over not just your farmland, but also care for your animals on that farm, too.

    

It is extremely vital, if you are in this situation, to make certain you do not procrastinate creating a plan. With no plan, all of your property will transfer according to your state's laws for people with no estate plans ("intestacy laws.") These laws make put your animals in the hands of someone who has no interest in maintaining their care, or alternately may distribute them to someone without the means, the knowledge or otherwise lacking the resources to provide for their care. If you have someone with the desire and the resources to provide for them, it is essential that you create a plan that gets that distribution on paper in a legal document.

Other families may have even more challenging situations, as there may be no trusted loved one with the ability and desire to take your animals. When that happens, you can still plan to provide for your animals' care. Several universities' colleges of veterinary medicine, such as Kansas State, Oklahoma State, Texas A&M and Purdue, among others, have programs that offer animals the opportunity to be cared for after you're gone. These programs often require a one-time gift in order to gain entry. Your estate plan can provide for both the transfer of legal ownership of your animals to the schools, but also cover the necessary payment to cover their admission. In addition to some veterinary colleges, some SCPA organizations also have programs. 

Many states recognize special types of trusts to cover the continued care of animals. Even if your state does not have specific "pet trusts," you can still plan for them. By working with an experienced estate planning team, you can be confident that your animals will enjoy the same level of care you've provided for them, even after you're gone.

Summary: Estate planning for your animals is important in any situation, but it is particularly so if you have animals such as horses that are not just house pets. The range of people who have the resources to provide these animals with proper homes is smaller, meaning that you should take care to have a plan in place that will ensure that the home you provide for your animals after your death is one that is up to your standards. 

Legacy Assurance Plan Article | A Trust Tool for Every Application

Summary: Many people have avoiding probate as one of their estate planning goals, for good reason. Many of those desiring to avoid probate have become somewhat familiar with revocable living trusts, which are an effective means for avoiding probate. However, multiple other tools exist for avoiding probate, including pay-on-death or transfer-on-death financial accounts, life insurance, annuities and, in some states, transfer-on-death deeds. Each option has a unique set of advantages and limitations. A qualified legal professional can help you decide which is right for you.  

When it comes to estate planning, a lot of people have heard of trust in general. They may be familiar with certain types of trusts, like the revocable living trust.

One well-known means for avoiding probate is the revocable living trust. These trusts can be great tools for accomplishing your probate avoidance goals, because the trust serves as a legal entity that (if all the proper steps are taken) owns assets for you, meaning that, when you die, your wealth is managed through the trust instead of your probate estate. Living trusts can also provide other benefits, such as ensuring the continuity of the management of your assets if you become mentally incapacitated. With a trust, your successor trustee can, in most cases, seamlessly take over these management duties without the need for a guardianship or conservatorship court proceeding, which can be stressful and time-consuming.

But, did you know that revocable living trusts are not the only way to avoid probate? In some cases, you may be able to own millions of dollars of assets and not need a trust to avoid probate. Life insurance policies and other insurance products (like annuities) have death beneficiary designations on them. Many bank, investment or other financial accounts can be structured to have "pay on death" or "transfer on death" designations placed on them. Some states have transfer-on-death deeds, which allow you place a death beneficiary on real estate that you own in those states. Other states recognize the enhanced life estate deed, which is somewhat similar to a transfer-on-death deed in that the property covered by that deed passes, upon the death of the owner, to a named beneficiary without the need of a probate administration. In each of these cases, the process of placing those assets into your beneficiaries' hands is simple, requiring only the death beneficiary paperwork, proof of the beneficiary's identity and a copy of the death certificate.

These death beneficiary accounts are not without their own risks, though. They will not provide any protection if you become mentally incapacitated. Additionally, if you desire to make major changes to the distribution of your wealth (perhaps due to a divorce or remarriage,) you must take care update each individual beneficiary designation.

In the end, only a trained estate planning legal professional, working in partnership with you, can help you decide which path works best for your goals and needs. 

This article written and published by:

Legacy Assurance Plan

8039 Cooper Creek Blvd

University Park, Florida 34201

844.306.5272 (Phone)

info@legacyassuranceplan.com (email)

       


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How Including a Trust Protector Can Help You Achieve Your Estate Planning Goals

Summary: Careful estate planning is about crafting a plan that can withstand any of a number of possible contingencies. One way to gain an extra layer of protection that ensures that your plan will carry out your goals is by using a trust protector. Your trust protector can make sure that, even if a trustee ceases carrying out his/her responsibilities as you had instructed, your plan can still handle it and ensure that your objectives will be accomplished. 

A trust, or trusts, can represent a very important of a complete estate plan for many folks. Depending on what types of trusts are included in your estate plan, they may help you avoid the expense and delays associated with some types of probate administration, save on taxes or help you protect a loved one with potential money management or legal liability issues. In order for a trust to accomplish what it's designed to do, it must have a competent and reliable trustee managing it. While any trust grantor doubtlessly plans carefully in selecting a trustee or trustee, no process is foolproof. One way to give yourself and your beneficiaries a little extra peace of mind is with the use of a trust protector.

A trust protector is a person you name in your trust. Generally, there are a few reasons why you might want to name a protector in your trust. One is to have an extra responsible person watching over the trustee to ensure that he/she is doing his/her job properly. Your protector can also provide guidance regarding distributions or investment choices. Additionally, your protector may be able to make changes to your trust in certain narrow situations such as changes to the laws in your state. Utilizing a trust protector can be especially helpful if your estate plan includes a specialized trusts. If your plan includes a special needs trust, adding a trust protector can be particularly beneficial.

In some trusts, the protector has exactly one job and one power: to identify when the trustee has ceased carrying out his/her duties in a proper fashion, and to terminate him/her as a result. Depending on how your trust is constructed, and the laws in your state, you may be able to empower your trust protector to name a new trustee to replace the terminated one. If you prefer, you can restrict the protector's powers to terminating a trustee only, and leaving the replacement of that trustee to the succession language you placed in your trust agreement document.

The trust protector language in your trust should be carefully constructed, just like the trustee language of your trust. The recitation of the powers you are giving your protector should be very specific, so that your protector knows exactly what he/she is being asked to do. Additionally, much like how a trust should include several successor trustees who would serve in the event of a preceding trustee's death, resignation or other inability to serve, your trust should also name several successor protectors who will take over in the event of a predecessor's inability to continue serving. 

    

Legacy Assurance Plan Article | Include Long-Term Care Planning in Your Estate Planning Considerations

Summary: One aspect of estate planning that too many people overlook is long-term care planning. With people living longer than ever, the chance of needing long term is higher than ever, so you need to have a plan in place. These plans can include many techniques for achieving your goals, such as buying, selling or restructuring assets in order to increase your ability to qualify for Medicaid, or protecting yourself through the purchase of long-term care insurance. 

People today are living longer than ever. According to current federal government statistics, if you live to be 65, you can expect to survive to see your 84th birthday if you're a man, 86 if you are a woman. A tenth of those 65-years-olds will make it to age 95. Given these longer life spans, the likelihood of experiencing a stay in a long-term care setting is also higher than ever. The US Department of Health says that 70% those age 65 or older will require some type of long-term care with more than half of those needing nursing home care. And that long-term comes with a substantial cost. A stay in a nursing home can run anywhere from $50,000 to $150,000 per year, depending on where you live. Nationally, that average works out to more than $200 per day for a semi-private room or $230 for a private one.

Medicaid is one source that may pay for your long-term care. However, in order to qualify for Medicaid, you must first spend almost all of your assets and have an income low enough that you meet the government's standards for financial neediness. This may dramatically derail the plans you have for leaving an inheritance to your children or grandchildren, as well as placing a hardship on your spouse if she is still living at home. 

The good news is that the federal government's Medicaid qualification rules exempt some assets from counting against you when you apply for Medicaid. For instance, if you purchase a car that your family uses for your medical needs (for example, traveling to the doctor's office,) then that car may not count against when you apply for Medicaid. Certain other assets, such as your home, retirement funds, prepaid final arrangement plans and some financial instruments (like some annuities) may also be exempt, meaning that you do not have to sell them in order to qualify. A qualified attorney can help you craft a plan that will help increase your chance of becoming eligible for Medicaid without completely impoverishing your family.  

Another option than may assist certain families is long-term care insurance. It is very important, however, to weight the costs and benefits of this insurance (like any purchase) in light of your situation. You should make certain that the policy you buy provides enough benefits to meet your needs, while still coming with a premium that you can afford. An inflation rider is in many cases also an extremely helpful component of a long-term care policy. 

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8039 Cooper Creek Blvd

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Legacy Assurance Plan Article | Financial Powers of Attorney: They're Useful, But Only Go So Far

Summary: A complete estate plan includes financial and healthcare powers of attorney in the vast majority of situations. However, one should be aware that financial powers of attorney are not without their limitations and difficulties. One way to escape some of these challenges is by using a revocable living trust, as financial institutions are, in many cases, less likely to refuse to recognize a successor trustee acting under the authority of a trust agreement that an agent acting under a power of attorney.  

Powers of attorney are important parts of almost every estate plan. A financial power of attorney is a document where you, as the document's creator (known as the "principal"), name someone else (your "agent") to make certain decisions about your assets on your behalf. This document can give your agent these powers from the moment you sign it or only after you have become mentally incapacitated and cannot make those decisions for yourself.

While these powers of attorney are vital pieces to the estate planning puzzle, they are not, however, without their challenges, as the New York Times recently reported. In an Aug. 22 article entitled "Power of Attorney Is Not Always a Solution", the Times explained that, with a power of attorney, "when it fails, the consequences can be nothing short of disastrous."

One of the problems with powers of attorney is that many financial institutions refuse to recognize them, meaning that, even when presented with a properly executed power of attorney document, the institution still refuses to give the agent access to, and control over, the principal's accounts. When this happens, the agent often has limited choices to break through this impasse except filing a legal challenge, which can be expensive and time consuming.

One estate planning technique that may help avoid some of these dilemmas and serve you better is using a revocable living trust. With a living trust, you put your assets into the trust while you are alive and competent. From a legal perspective, your trust owns those assets, so transitioning their control and management from you to the person you've designated requires only documentation that the person seeking that power is the properly appointed successor trustee and proof that they are entitled to begin acting on behalf of the trust (such as a death certificate in the event of your passing or doctors' notes stating that you've become mentally incapacitated.)

As the article correctly points out, using a trust reduces the risk of having a problem with the bank. One attorney explained it to the Times this way, "Banks are more comfortable with this ... What you’re doing is getting a jump on the legal system designed to handle these things." In order for this plan to work, though, you must make sure you fill out the necessary paperwork to place the asset into the trust. Each financial institution may have its own transfer documents it may require to complete the transaction.

This article written and published by:

Legacy Assurance Plan

8039 Cooper Creek Blvd

University Park, Florida 34201

844.306.5272 (Phone)

info@legacyassuranceplan.com (email)

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