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Joint Tenancy Does Not Replace a Will
September 30, 2009
Many people think that owning property in joint tenancy means they don’t have to create a will or estate plan. Why bother with a will when all the property is going to your joint tenancy partner anyway? In fact (some people may ask) why not do away with the need for a will altogether and hold property in joint tenancy with my children? The answer to that question is that although joint tenancy may allow your heirs to avoid probate, it carries with it a number of problems and is NOT a replacement for a well-executed will or estate plan.
One of the primary problems with owning property in joint tenancy with your children is that, in the words of Phil Craig in his article Joint Tenancy: How Not to Avoid Probate, “Joint tenancy sure is easy to create, but sure is hard to end.” As Craig illustrates in his article, owning property jointly with your children may seem harmless at first, but what happens if your child gets married or divorced, gets sued, or even joins a cult?
Beyond the essential question of ownership, joint tenancy as an estate planning method falls short in numerous other ways as well; owning property in joint tenancy with your children does not do anything to minimize your estate taxes—In some ways it may actually increase your taxes. Additionally, owning property in joint tenancy with more than one of your children prohibits the other owners from leaving their share of the property to their own heirs.
Finally, even as husband and wife, holding property in joint tenancy has its dangers. If one of you were to become incapacitated or mentally incompetent, the other would have to obtain a conservatorship from the court before being able to sell or take any other legal action with the property. Having the ability to sell or refinance quickly could become a necessity when medical bills are piling up. Look into owning your home as community property instead.
There are ways to avoid making probate a necessity after your death, but joint tenancy—while it may be quick and somewhat easy to achieve—is neither a quick nor easy solution to probate. Take the time to create a quality will or estate plan. Your assets will be protected in the long run, and your heirs will thank you in the end.
Geriatric Care Managers Provide Help for Families and Caregivers
September 28, 2009
Caring for elderly relatives is always a team effort. Sometimes the team consists of the entire family, sometimes the team is a man and wife, and sometimes the team consists solely of the elderly person and their primary caregiver; but no matter how you look at it, elder care is a complex, difficult, and expensive job, and one made 10 times easier if you have a knowledgeable and trustworthy expert on your team.
There are many knowledgeable elder care experts out there: doctors, lawyers, social workers; but few of them can straddle ALL of the elder care issues (medical, legal, residential, financial) to help you look at the big picture. A geriatric care manager is someone who can do just that—look at any given situation from all angles and advise your elder care team on the big picture. This article in the New York Times describes geriatric care managers as assessors, counselors, mediators… and sometimes someone to play “bad cop” in a tough situation.
Of course, because most insurance companies won’t yet pay for the services of a geriatric care manager, hiring one is going to be an extra expense; but it is the business of a GCM to know the ins and outs of the elder care system, and the money they save your family by helping you research experts and options, and avoiding bad situations can more than make up for the expense.
A geriatric care manager cannot replace a doctor or a lawyer on your elder care team, but they can help all of the team players work together effectively toward a common goal: ensuring that your loved one is well taken care of in the best situation possible.
Finding the Right Guide to Help You Navigate Rough Financial Waters
September 25, 2009
Whether you’re just starting out on your own at the age of 18, or a 65 year old thinking about retirement, or anything in between, financial planning is essential. When most people think about financial planning they think about saving and investing, but a financial plan encompasses much more than that; it includes planning for taxes, charitable giving, gifts to children and grandchildren… and it includes protecting your current assets and planning your estate.
If you’re just starting out on your own your goals may be simple: establish your long term plan, purchase a home, and start putting a little bit away each month toward retirement. If you’re older and more established in your career and finances, your goals are likely much more complex: college for your kids, long term care insurance for you and your spouse, helping to care for your elderly parents, and protecting your assets from estate taxes.
For those who are just beginning to think about your financial futures, this article by Wesley E. Watkis shares 6 basic steps to creating a financial plan, and is a good introduction to the world of planning, saving and investing. Watkis writes that the first step to financial planning is establishing goals; knowing what you want your money to do for you in the years ahead is essential before you map out your plan of attack.
Of course, if you’re a more established adult what you will need is personal guidance in turning those initial goals into an effective plan, and then help maintaining that plan and growing your wealth. For that you will most likely need to find a financial planner whose expertise and philosophy fits your family’s needs, but finding the perfect financial guide for your family is not always as easy as you would hope.
A large part of planning your finances includes planning your estate, and vice-versa; and our firm works closely with many excellent financial professionals. Please don’t hesitate to call our office where we can work with you to assess your needs, and put you in touch with a qualified financial professional who can help your family safely plan for the future.
Top 10 Mistakes to Avoid When Planning Your Estate
September 23, 2009
There are a number of mistakes that an estate planning and probate attorney will see over and over again over the course of their career. Many of these mistakes seem small, but can have a huge negative impact on your family after your death. More often than not these mistakes are made by people trying to create cheap and “easy” plans on their own without the guidance of an experienced professional. Luckily, these mistakes can be easily rectified with a phone call or a visit to our office.
Have you made any of the following mistakes in your estate plan?
10. Choosing guardians for your children who are far away, with no instructions for temporary guardians.
9. Hiding your estate documents (and other important financial documents, for that matter) away “somewhere safe” where no one can find them… not even when they need to find them.
8. Neglecting to leave information about your online accounts and assets.
7. Leaving it to your family to fight over mementos and heirlooms instead of creating a personal property memorandum.
6. Forgetting to coordinate beneficiary designations on retirement accounts, life insurance policies, or other similar assets.
5. Neglecting to review your trust regularly (once every 2-5 years).
4. Not naming backup (or remote contingent) beneficiaries.
3. Naming only one Agent or Trustee, with no alternates.
2. Neglecting to fund your trust.
And the number 1 mistake to avoid when planning your estate is this: Not making a plan in the first place!
What To Do When Your Kids Don’t Like Your Will
September 21, 2009
In an ideal world elderly parents and their adult children always get along, and when those parents pass away their children quietly and respectfully follow their wishes regarding the distribution of their estate. Unfortunately, we don’t always live in an ideal world, and inheritance and estate planning can often cause tension between parents and children before the parents have even reached retirement age!
What are your options when you know your kids won’t like what you’ve put in your will or trust? Many people choose to simply keep their wishes secreted away in a safety deposit box until they’ve passed away and then let everyone fight it out on their own; but this only puts off the bad feelings and can often cause lasting rifts among siblings. This strategy of secrecy also doesn’t address what happens if you become incapacitated and need one of your trustees or agents (in all likelihood one of your children) to take over your affairs.
A better option than secrecy is to invite your children to your final meeting with your estate planning attorney. This gives you an opportunity to share your plans in the presence of a knowledgeable professional who is on your side; it also gives your kids the chance to ask questions and get clear and immediate answers. More often than not tension about mom and dad’s estate plan stems from a lack of understanding, or a worry that mom or dad have been taken advantage of. Having a family meeting with your attorney can be reassuring, educational, and put everyone one the same page moving into the future.
The Shortest Will: It May Hold the Record, But It Won’t Hold Water
September 18, 2009
Have you ever wondered just how little you could get away with in your last will and testament? Aletta Stager of Brooklyn, NY holds the distinction of having executed one of the shortest wills on record—a mere 2 lines long!
“Nov. 29, 1895. I give to my cousin, Nettie M. Cowan, all money that I have in the Bowery Savings Bank.
Aletta Stager, 131 Berkeley Place, Brooklyn, N.Y.”Of course, things have changed in the probate and estate planning world in the one hundred plus years since Ms. Stager executed her will. A glaring omission from the two lines above is the nomination of an executor. If you don’t nominate an executor in your will the state will choose one for you. Also, even if you have only one person in mind as your beneficiary, you’ll want to talk to an attorney about secondary beneficiaries, who can include charities and non-profits if you don’t have any family or friends to whom you’d like to leave your estate.
Even back in 1895 Aletta Stager’s property ended up going to the state of New York when no heirs—including the named beneficiary—could be found. Perhaps if Ms. Stager had included a couple more lines in her will her estate could have gone to benefit her favorite charity instead of being swallowed up by the state.
Women: Take Charge of Your Finances… And Your Future!
September 16, 2009
A woman today often has to wear many hats: daughter, wife, mother, employee, boss, caregiver, family CFO, etc. Women are unique contributors both within their families and in society at large, often taking care not only of young children but of elderly parents as well; but too often women can forget to take care of themselves, and this includes taking care of their finances.
Whether they are single, married, divorced or widowed, every woman needs to have a good understanding of her current finances and a plan for the future. If you are married your finances (both present and future) will likely be part and parcel of your family finances, but it is still essential that you be aware and involved in the decision-making process, luckily Forbes.com makes it easy for women to plan for the future of their finances with this “how-to” article from their Forbes Woman section.
One of the most important points made by the article is that planning for the future is essential no matter how much you have (or don’t have) in your bank account. “’It doesn’t matter how much money is in your bank account’ or what age you are, [says Debbie Whitlock, co-owner of Sound Financial Partners, a financial-services practice in Seattle] ‘Everyone needs to do estate planning. Without it there’s a lot of confusion and chaos.’” And don’t let the term “estate planning” fool you, estate planning covers much more than just distributing an estate—especially for women and mothers.
Even if you don’t feel you have an “estate” to distribute, the creation of a very simple will, healthcare directive, and a list of assets and/or debts can save your family hours of confusion in the future; and it can help you have a better understanding of your finances right now.
A Guide to Taking Care of the Details After the Death of a Loved One
September 14, 2009
“The death of a loved one imposes cruel demands on the closest survivors.” The truth of that statement from this article in moneywatch.com is known to anybody who has lost a close friend or family member. We’ve written a lot on our blog about going through the probate process when a loved one dies, but probate isn’t the only thing you have to think about; in fact, it may not even be the first thing you should think about. At a time when you are bombarded by as many emotional demands as you are mundane demands, how can you know what to do first?
The article mentioned above contains a helpful guide for those who are dealing with loss. It includes well-known items such as “contact close friends and family” and “make funeral arrangements” as well as items that may not come to mind as naturally, such as “write an obituary” and “contact the deceased’s employer.” Few people think about these things when under emotional strain, which is why this list is an excellent resource to file away for a time when it may be needed.
If you are having a particularly hard time with the grieving process don’t be afraid to ask others to help with the more difficult items, or to hand the list over entirely to someone else. This is when your own probate or estate planning attorney (or the deceased’s attorney, if they had one) can be especially helpful.
Although it sometimes feels as if time should stand still when someone we love passes away, life does go on, for better or worse. But the world is full of caring and knowledgeable people to help you through the process… if you only know where to look.
Changes to New York Powers of Attorney May Lead to Changes for All
September 12, 2009
An interesting article in this week’s Time Magazine online addresses some of the weaknesses in the Durable Power of Attorney (POA) document—especially as regards the elderly—and how New York State is addressing these weaknesses. If New York’s experience with the beefed-up POA is favorable it is quite possible that other states will adopt similar changes.
Of all the changes made to the laws surrounding the POA, the most major change is the larger role the agent has in the signing of the document. ”Now both the principal and the agent must sign the POA, and each signature must be notarized. ‘This is a big change,’ [says Ronald Fatoullah, an elder-law and estate-planning attorney in New York]. ‘The document specifically states that when you accept the authority to act as agent, you create a special fiduciary relationship with the principal that imposes legal responsibilities until you resign or the power of attorney is terminated.’”
In addition, and of particular help to elderly clients, is a provision giving the principal the right to appoint a monitor to oversee the activities of the agent. Requiring your agent to work under the advice of a trusted financial advisor or the like may add a slight delay to large financial transactions, but it will prevent crooked relatives or elderly aides from taking advantage of the principal.
As the article mentions, “financial abuse is one of the fastest growing areas of elder abuse”, and most of the abuse is perpetrated by people the victims know and trust. Hopefully these changes will help prevent this abuse. If the new POA proves beneficial for New York residents those of us in other parts of the country may find our own Powers of Attorney changing as well.
How to Leave Meaningful Mementos to the Next Generation
September 10, 2009
Older Posts »When clients come into our office to design their estate plans one of their biggest concerns is how to dispose of their tangible personal property. Sometimes clients spend more time determining how to dispose of these personal mementos than they do the big ticket items such as bank accounts, real property, and investments. This is completely understandable when you consider that it is these personal items that carry our history and our memories, and in many ways make up the fabric of our lives.
One of the questions we are often asked is if these personal items should be included in the will or trust or if there is an easier way to dispose of them. The answer is that although major items such as the crown jewels should be listed in your will or trust, smaller mementos such as a baseball card collection or grandma’s china (things that are not required to go through probate) can be listed on a much less intimidating document called a personal property memorandum.
A personal property memorandum is a written statement which lists your various tangible personal items along with the people who should receive these items upon your death. (Tangible personal items do NOT include bank accounts, stocks, money, securities, or trade or business properties.) The nice thing about the personal property memorandum is that you can edit and update it yourself, whereas any changes to a will or a trust should be made by a qualified attorney. You must, however, be sure that your will or trust refers to your personal property memorandum if you have one, to ensure that there is no confusion about distribution of property.
A personal property memorandum can be typed up, handwritten, or can be a standard template that you get from your attorney to fill out at home—so long as it clearly expresses your wishes and is signed and dated. It is best to store your personal property memorandum in a safe place with the rest of your estate planning documents; but if you find yourself making frequent changes to the document it can be kept at home, so long as your trustees or executor know where to find it if something happens to you.
For more information about how to leave personal property to your heirs please contact our office.
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www.joneselderlaw.com
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