Tag: estate planning

What To Do When a Disability Throws Your Estate Plan Into Chaos

As poet Robert Burns mused centuries ago, “The best-laid plans of mice and men often go awry.” Despite thoughtful effort and a concerted strategy, you cannot prepare for every emergency. A car accident, sudden illness, workplace injury or chronic medical condition can force you to re-evaluate the core assumptions you used to plan your future and set up your legacy.

A 2015 report published by the Centers for Disease Control and Prevention (CDC) offered this sobering assessment: “In 2013, approximately one in five U.S. adults reported any disability, with state-level prevalence of any disability ranging from 16.4% in Minnesota to 31.5% in Alabama.” The CDC also reported that “annual disability-associated health care expenditures were estimated at nearly $400 billion in 2006, with over half attributable to costs related to nonindependent living (e.g., institutional care, personal care services).”

Frustratingly, you can’t turn back the clock. However, you can take meaningful actions to protect your legacy and estate in the wake of your newfound limitations. Here are some insights to that end:

Work with a qualified estate planning attorney to ensure that:

  • There’s an authorized person to make financial and healthcare decisions for you if you
    become mentally or physically unable to do so yourself.
  • There’s also an authorized person to manage your property, pay your bills, file your
    taxes and handle similar business if you’re unable to do these tasks.
  • Your wishes about health care decisions, such as end of life care and do-not-resuscitate
    instructions, have been communicated in a legally valid and binding manner.

Get a recommendation from your estate planning attorney or your financial advisor, who can help you take additional actions, such as:

  • Ensuring that you have appropriate insurance.
  • Reassessing your investment options and portfolio in light of your new limitations and constraints on your ability to generate income.
  • Making sure that you have a budget that works and that your bills will all get paid on time.

Mind this important distinction:

Be advised that “disability” for legal purposes is different than “disability” for financial planning purposes.

For example, disability for financial purposes might mean you can’t work gainfully anymore because of cancer or a workplace injury. On the other hand, “incapacity” in an estate planning context typically means that a person is no longer capable of making sound decisions, often due to systemic illness or injury.

In other words, you can be “disabled” for financial/insurance purposes and be non-disabled for legal purposes. However, almost anyone who is disabled for legal purposes would also be considered disabled for financial purposes.

Either way, it’s important for us to work together with your financial advisor to make sure you and your family are fully protected.

Take these actions on your own:

  • Pay attention to where your money is going as well as to your long term planning strategy. Your estate planning attorney can help you assess whether your current plans
    are still realistic and, if not, what alternative options you have.
  • Maintain a healthy lifestyle. For instance, cut down on added sugars and refined vegetable oils and be sure to eat enough vegetables, protein, and healthy fats.
  • Get the help you need from trusted professionals. Now is the time to tap your friends and family and network for assistance with the heavy lifting. No single advisor will have
    all the answers. But your team can work in concert to reduce the anxiety and uncertainty and keep you focused on what really matters.

Please reach out to us to assess your long term plans and documents and make sure you are as secure as possible in light of your new challenges.

The content of this article is general and should not be relied upon without review of your specific circumstances by competent legal counsel. Reliance on the information herein is at your own risk, as it expresses no opinion by the firm on your specific circumstances or legal needs. An attorney client relationship is not created through the information provided herein.

5 Tragic Mistakes People Make When Leaving Assets to Their Pets

A pet trust is an excellent way to make sure your beloved pet will receive proper care after you pass on. The problem, of course, is that you won’t actually be there to see that your wishes are carried out. It’s critical to set up a pet trust correctly to ensure there are no loopholes or unforeseen situations that could make your plans go awry. Here are 5 tragic mistakes people often make when leaving their assets to their pets.

1. Appropriating more than the pet could ever need.

The gossip stories about such-and-such celebrity who left his or her entire fortune to a pet are the exception rather than the rule. Leaving millions of dollars, houses, and cars to your pet is not only unreasonable, but it’s more likely to be contested in court by family members who might feel neglected. To avoid this pitfall, leave a reasonable sum of money that will give your pet the same quality of life that she enjoys now.

2. Providing vague or unenforceable instructions.

Too many pets don’t receive the care their owners intended because they weren’t specific enough in their instructions or because they did not use a trust to make the instructions legally binding. Luckily, a pet trust can clarify your instructions and make them legally valid.

If you leave money to a caretaker without a pet trust in place, hoping it will be used for the pet’s care for example, nothing stops the caretaker from living very well on the pet’s money. But when you use a pet trust to designate how much the caretaker receives and how much goes for the pet’s care, you’ve provided a legal structure to protect your furry family member. You can be as specific about your wishes as you’d like, from how much is to be spent on food, veterinary care, and grooming. You can even include detailed care instructions, such as how often the dog should be walked.

3. Failing to keep information updated.

Bill sets up a pet trust for his dog Sadie, but what happens if Sadie passes away? If Bill gets a new dog and names her Gypsy, but he doesn’t update this information before he dies, Gypsy could easily wind up in a shelter or euthanized because she’s not mentioned in the trust. This is a common yet tragic mistake that can be easily avoided by performing regular reviews with your estate planning attorney to ensure that your estate plan works for your entire family.

4. Not having a contingency plan.

You might have a trusted friend or loved one designated as a caretaker in your pet trust, but what happens if that person is unable or unwilling to take that role when the time comes? If you haven’t named a contingent caretaker, your pet might not receive the care you intended. Always have a “Plan B” in place, and spell it out in the trust.

5. Not engaging a professional to help.

Too many people make the mistake of trying to set up a pet trust themselves, assuming that a form downloaded from a do-it-yourself legal website will automatically work in their circumstances. Only an experienced estate planning attorney should help you set it up to help ensure that everything works exactly the way you want.

When attempting to leave assets to your pet, the good news is that with professional help, all these mistakes are preventable. Talk with us today about your options for setting up a new pet trust or adding a pet trust to your current estate plan. We’re here to help.

 

The content of this article is general and should not be relied upon without review of your specific circumstances by competent legal counsel. Reliance on the information herein is at your own risk, as it expresses no opinion by the firm on your specific circumstances or legal needs. An attorney client relationship is not created through the information provided herein.

Strategies to Protect Your Assets

Or, in other words, “What you need to do for your nest egg”.

You’ve worked hard for your entire life and want to have a nest egg for your loved ones after you’re gone. What many people don’t realize is that protecting your assets can often be as difficult as accumulating them.

However, there are some things you can do to preserve what’s rightfully yours. First, and most importantly, never try to avoid paying your taxes. It’s not worth it.

Also, avoid a “one size fits all” solution for protecting your assets, since everyone has a unique financial situation.

“Strategies that work well for one person could be harmful for another person. This means you’ll have to do some work, but it also means you’ll know exactly what your asset protection strategy is and that it’s right for you.” says Anne Desormier Cartwright of Elder & Estate Planning Attorneys PA.

Take a proactive approach to asset protection and start early in life. Use it as a supplement to insurance, rather than a substitute. Another important thing to know is to never mix personal and business assets. Don’t pay personal expenses with a business account, and vice versa

An experienced estate planning attorney can help simplify your goals and create an asset protection plan catered to you.

Elder and Estate Planning Attorneys PA is a law office small enough to provide personal service but large enough to handle all of your estate and planning needs.