Can I Protect My Family after Death?

Can I Protect My Family after Death?

Estate planning involves a close look at personal and financial goals while you are living and after you have died, as explained in a recent article titled “Professional Advice: Secure your future with estate planning” from Northwest Indiana Business Magazine. Having a comprehensive estate plan ensures that your wishes will be carried out and loved ones protected.

Your last will and testament identifies the people who should receive an inheritance—heirs—who will manage your estate—executor—and who will take care of your minor children—guardian. Without a valid will, the state will rely on its own laws to distribute assets and assign a guardian to minor children. The state laws may not follow your wishes. However, there won’t be anything your family can do if you didn’t prepare a will.

Assets with beneficiary designations can be passed to heirs without going through probate. Certain assets, like life insurance policies and retirement accounts, allow a primary and secondary beneficiary to be named. These assets can be transferred to the intended beneficiaries swiftly and efficiently.

Many people use trusts to pass assets for a variety of reasons. For example, a trust can be created for a family member with special needs, protecting their eligibility to receive government benefits. Depending on the type of trust you create, you might be able to eliminate estate taxes. Certain trusts are also useful in protecting assets from creditors and lawsuits, and ensure that assets are distributed according to your wishes.

Revocable living trusts provide protection in case of incapacity, avoid probate and ancillary probate and may provide asset protection for beneficiaries. If you are the creator of a trust—grantor—you will need to appoint a successor trustee to manage the trust if you are the original trustee and become incapacitated. Upon death, a revocable trust usually becomes irrevocable. Assets placed in the trust avoid probate, the court proceeding used to settle an estate, which can be both time-consuming and costly.

A Power of Attorney allows you to name a person who will handle your financial affairs and protect assets in the event of incapacity. That person—your agent—may pay bills, sell assets and work with an elder law estate planning attorney on Medicaid planning. The POA should be customized to your personal situation. you may give the agent broad or narrow powers.

Everyone should also have a Health Care Proxy, which gives the person named the legal right to make health care decisions on your behalf if you are unable to. You’ll also want to have a HIPAA Release Form (Health Insurance Portability and Accountability Act), so your agent can speak with all health care providers, access medical records and speak with the health insurance company on your behalf.

A Living Will is the document used to convey your wishes regarding end-of-life care if you are unable to do so yourself. It is certainly not pleasant to contemplate. However, it should be thought of as a kindness to your loved ones. Without knowing your wishes, they may be forced to make a decision and will never know if it was what you wanted. A Living Will also avoids conflicts between health care providers and family members and makes a stressful time a little less so.

Having a comprehensive estate plan provides protection for the individual and their family members. It avoids costly and stressful problems arising from the complex events accompanying illness and death. Every three to five years (or when life or financial circumstances warrant), meet with an estate planning attorney to keep your estate plan on track.

Reference: Northwest Indiana Business Magazine (Dec. 27, 2022) “Professional Advice: Secure your future with estate planning”

How Does Guardianship Work?

How Does Guardianship Work?

For family members of the estimated 6.5 million dementia patients in the U.S., it is crucial to understand whether guardianship may be an option for their loved one. A recent article from Next Avenue titled “Thinking of Becoming a Guardian?” explains how the guardianship process works and what factors go into the decision-making process.

Guardianship is the position of being responsible for someone else. State courts usually appoint a guardian to make decisions for a person, if the court finds that person to be incapacitated or unable to make safe and reasonable decisions for themselves. People who are placed under guardianship, known as “wards,” often lose their independence in making financial, legal and health care decisions.

If full guardianship is awarded, the person cannot make decisions about whether they may vote, marry, where they live, or make their own end-of-life decisions.

Two tasks that are evaluated when considering guardianship are a person’s ability to manage personal finances and to take medications as prescribed.

The court may call on a geriatrician or psychiatrist to evaluate the person’s functional behavior, cognitive function, disabling conditions and ability to meet their essential needs.

There are benefits to guardianship for someone who is not able to care for themselves. It ideally creates a safety net for a person who cannot make informed decisions for themselves.

this, of course, assumes that the guardian is honest and accountable, which is not always the case. The inconsistencies plaguing the guardianship system include minimum standards for guardians, lack of regular independent reviews of the need for guardianship and lack of educational requirements for guardians.

Once guardianship is assigned, there is a tendency for the person to become lost when no follow-up is done. The very same person who lacks capacity to care for themselves is not going to be able to advocate for themselves, contact an attorney or access funds for court proceedings.

There is also a tendency to assign full guardianship for a person, rather than less restrictive alternatives.

There are alternatives, but they require planning and discussion. More than 40% of Americans have not discussed their wishes for end-of-life care with their loved ones, according to an article in the Journal of the American Geriatrics Society. Families should have a conversation at the first sign of memory loss or when preparing for retirement regarding wishes for end-of-life care and write them down as part of an Advanced Directive—also known as a Living Will and Health Care Power of Attorney—when preparing their estate plan.

Another important document, although not legally binding, is a “Value History,” where you share your values and beliefs as they may impact care choices.

Designate a Power of Attorney and list two or even three back-up candidates. This person will be responsible for financial, legal and personal matters, avoiding the need for guardianship.

Appointing a family member or friend as a guardian is the ideal solution. However, there are instances when the best person to be a guardian is not a family member, but a court-appointed outsider. This relieves the family of being the ones who need to inform a person suffering from dementia with the news of having to move into a nursing home facility or sifting through financial records to learn that the family home is in foreclosure. The family can focus on being supportive and loving, while the guardian deals with the sometimes harsh realities of the person’s life.

Speak with your estate planning attorney to learn about how guardianship works, and whether it may be the right move for your family.

Reference: Next Avenue (Dec. 23, 2022) “Thinking of Becoming a Guardian?”

Read more about the article What Trust Documents are Needed in an Emergency?

What Trust Documents are Needed in an Emergency?

Most people don’t have any idea where to start when it comes to their emergency documents.  This often keeps them from going anywhere near their estate planning. This is a big mistake, says a recent article, “3 tasks your family needs to complete to ease any anxiety over unexpected emergencies,” from MarketWatch.

Estate planning is not just about wealthy people putting assets into trusts to avoid paying taxes. Estate planning includes preparing for life as well as death. This includes a parent preparing for surgery, for instance, who needs to have the right documents in place so family members can make emergency medical or financial decisions on their behalf. Estate planning also means being prepared for the unexpected.

Power of Attorney. Everyone over age 18 should have a POA, so a trusted person can take over their financial decisions. The POA can be as specific or broad as desired and must follow the laws of the person’s state of residence.

Medical Directives. This includes a Medical Power of Attorney, HIPAA authorization and a Living Will. The Medical POA allows you to appoint an agent to make health care decisions on your behalf. A HIPAA authorization allows someone else to gain access to medical records—you need this so your agent can talk with all medical and health insurance personnel. A living will is used to convey your wishes concerning end of life care. It’s a serious document, and many people prefer to avoid it, which is a mistake.

All of these documents are part of an estate plan. They answer the hard questions in advance, rather than putting family members in the terrible situation of having to guess what a loved one wanted.

An estate plan includes a will, and it might also include a trust. The will covers the distribution of property upon death, names an executor to be in charge of the estate and, if there are minor children, is used to name a guardian who will raise them.

A list of important information is not required by law. However, it should be created when you are working on your estate plan. This includes the important contacts from doctors to CPAs and financial advisors. Even more helpful would be to include a complete health profile with dates of previous surgeries, current medications with dosage information and pharmacy information.

Don’t overlook information about your digital life. Names of financial institutions, account numbers, usernames and passwords are all needed if your agent needs to access funds. Do not place any of this information in your will, as you’ll be handing the keys to the vault to thieves. Create a separate document with this information and tell your agent where to find the information if they need it.

Reference: MarketWatch (Nov. 19, 2022) “3 tasks your family needs to complete to ease any anxiety over unexpected emergencies”

The Basics of Estate Planning

The Basics of Estate Planning

No matter how BIG or small your net worth is, estate planning is a process that ensures your assets are handed down the way you want after you die.

Forbes’ recent article entitled “Estate Planning Basics” explains that everybody has an estate.

An estate is nothing more or less than the sum total of your assets and possessions of value. This includes:

  • Your car
  • Your home
  • Financial accounts
  • Investments; and
  • Personal property.

Estate planning is the process of deciding which people or organizations are to get your possessions or assets after you’ve died.

It’s also how you leave directions for managing your care and assets if you are incapacitated and unable to make financial or medical decisions. That is done with powers of attorney, a healthcare directive and a living will.

Your estate plan details who gets your assets. It also designates who can make critical healthcare and financial decisions on your behalf should you become incapacitated. If you have minor children, it also lets you designate their legal guardians, in case you die before they reach 18. It also allows you to name adults to safeguard their financial interests.

Your estate plan directs assets to specific entities or people in a legally binding manner. If you want your daughter to have your coin collection or your favorite animal rescue organization to get $500, it’s all mapped out in your plan.

You can also create a trust to safeguard a minor child’s assets until they reach a certain age. You can also keep assets out of probate. That way, your beneficiaries can easily access things like your home or bank accounts.

All estate plans should include documents that cover three main areas: asset transfer, medical needs and financial decisions. Ask an experienced estate planning attorney to help you create your  plan.

Reference: Forbes (Nov. 16, 2022) “Estate Planning Basics”

Why Do You Need an Estate Plan?

Why Do You Need an Estate Plan?

Everyone benefits from having an estate plan. If you own property, investments, or anything of value, you need an estate plan. If you have family or dependents, you need an estate plan. Estate planning directs how assets are directed, if you become incapacitated or when you die.

The checklist for creating an estate plan includes a will, powers of attorney and assigning beneficiary account designations. Using an estate planning lawyer ensures that your plan meets all legal requirements, according to the article “What is estate planning? A strategy to safeguard your family and your finances, and ensure your plans for them get carried out as you wish” from Business Insider.

In this usage, “estate” means the things you own. An estate plan inventories everything, including your home, cars, bank accounts, life insurance policies, retirement accounts and personal possessions. It outlines in writing exactly what you want to happen with your property. It also directs who you want to handle your affairs during life and after death and who you want to inherit your assets.

Why does estate planning matter? If you die without a will, your assets may get tied up in probate, where the court oversees the distribution of your estate according to your state’s laws. Without a will and the tax planning part of estate planning, your estate may shrink and your heirs receive less.

The will is just the start of a comprehensive estate plan. It details where you want your assets to go and names an executor who will oversee your estate. If you have minor children, the will is where you name a guardian to raise your children.

A durable power of attorney designates a person to act on your behalf for legal and financial matters if you become incapacitated. Without it, family members will not be able to file tax returns, collect government benefits, manage investments and handle any financial transactions. They’ll need to go to court and have a judge appoint someone to manage these and other tasks. It’s far easier and less expensive to have this document in place than to get the courts involved.

A health care power of attorney is your opportunity to name someone to make medical decisions on your behalf if you become incapacitated. This includes choosing doctors, deciding what tests to run and whether you want to have surgery or certain treatments.

You’ll want a living will to ensure your wishes for end-of-life decisions are followed. A living will also relieves your loved one of the enormous burden of determining “what Mom would have wanted” if you become terminally ill, enter the late stages of dementia, are seriously injured, in a coma, or near the end of your life. What extreme measures do you want to be taken to prolong your life? What would you not want to be done to maintain your life?

Beneficiary designations are the forms to be completed when you open a retirement account or purchase a life insurance policy. Beneficiary designations override any instructions for these accounts set out in your will, so its very important to review and update them regularly.

Trusts are used to take assets out of your probate estate. A trust is created by an estate planning attorney and upon death, assets are distributed according to the directions of the trust. If you own a lot of assets, trusts are a useful tool to avoid estate and inheritance taxes.

Digital asset protection trusts are a way to legally transfer domain names, social media accounts and other digital assets to heirs upon your death. Emails, text messages, cloud-based storage accounts, websites and social media accounts all need to be inventoried and a plan needs to be in place to protect these assets.

Reference: Business Insider (Sep. 22, 2022) “What is estate planning? A strategy to safeguard your family and your finances, and ensure your plans for them get carried out as you wish”

How Can an Elder Law Attorney Help Me?

How Can an Elder Law Attorney Help Me?

Seasons’ recent article entitled “Finding an elder care lawyer” discusses ways in which an experienced elder law attorney can help you.

Social Security. Did you know that you’re statistically more likely to achieve a positive outcome when you get help from a lawyer when approaching the Social Security Administration?

Elder attorneys know the steps they can take to get the Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) your senior deserves. Both of these programs can provide your senior with considerable financial assistance as they age.

Medicare and Medicaid planning. An elder attorney can accurately assess your eligibility and determine if it’s worth applying for Medicaid. If your application is denied, your attorney can also help you to appeal this decision.

An experienced Medicare lawyer can also help you to understand the various options available to you, letting you move forward and pursue the best possible health care assistance for your elder loved one. You may be paying more than necessary in premiums or out-of-pocket expenses, and a lawyer can guide you toward more suitable choices.

Probate. You may need to engage an elder law lawyer after your senior loved one has died. They can guide the entire family through this difficult time, assisting executors and ensuring that beneficiaries receive their inheritances.

While the probate process can be avoided entirely if your senior works with a qualified estate planning attorney prior to their death, there are several estate planning tools that can make inheriting assets much easier, including trusts.

With help from an experienced estate planning attorney, your senior can identify the most effective types of legal documents for their needs. Estate planning attorneys can also help with wills, advance directives, powers of attorney and more.

Reference: Seasons (Aug. 30, 2022) “Finding an elder care lawyer”

Important Documents in Your Estate Plan

Important Documents in Your Estate Plan

The Durable Power of Attorney (DPOA) and a Health Surrogacy or Advanced Health Directive are used for situations where you can’t make decisions for yourself, explains Parent Your Parents recent article entitled “What You Should Know about Durable Powers of Attorney and Health Surrogacies.”

A Durable Power of Attorney (DPOA). This is written authorization to represent or act on another’s behalf in private affairs, business, or legal matters. The person authorizing the other to act is the “principal” or “grantor.” The person given the power is called the “agent” or “attorney-in-fact.” There are two types of power of attorney: (1) a Springing Durable Power of Attorney, which “springs” into action when you become incapacitated; and (2) a General Durable Power of Attorney, which becomes effective as soon as it is signed and continues until you die.

If you live in a “Springing POA” state and move to a “Durable POA” state, the document is treated as a Durable Power of Attorney, and your agent can act without your consent. You should consider who you trust to be your agent.

It is typically a family member, a friend, or a professional agent. You should also have an alternate designated who can step in if something happens to your first choice and he or she is unable to serve.

Health Surrogacy or Advanced Directive. This document is called a variety of things: a Power of Attorney for Health, Designation of Health Surrogate, or a Living Will. No matter what it’s called, you’re appointing an adult to make healthcare decisions for you when you are unable to make them for yourself.

When you’re in an accident, unconscious, or injured and need a specific medical procedure, the designated agent steps in and makes important decisions in your stead.

If you’re in your 60s but still don’t have a legal document describing what you want to happen when you’re incapacitated, speak with an experienced estate planning attorney.

Your family, close friends, and healthcare professionals should know how you feel about end-of-life treatments and have your detailed directions as to various circumstances and how you would like them handled.

Reference: Parent Your Parents (Sep. 15, 2022) “What You Should Know about Durable Powers of Attorney and Health Surrogacies”

Is a Living Will the Same as an Advance Directive?

Is a Living Will the Same as an Advance Directive?

A comprehensive estate plan contains far more than a last will and testament. It also contains a number of documents to communicate wishes for decisions to be made during life. These include a living will, an advance directive and a healthcare power of attorney, as explained in the article “What Is a Living Will and Do I Need One?” from healthline.

What is a living will? A living will is a document providing instructions for medical care, or in some circumstances, for the termination of medical support. They indicate wishes for the use or discontinuation of life-sustaining medical treatments. The living will is used if the individual becomes incapacitated and cannot communicate normally. Incapacitation is determined and certified by a medical professional. Living wills address such treatments as resuscitation, hydration, a feeding tube and pain management.

Each state has its own rules for creating a legally valid living will. The information required in most states is:

  • Legal name and any aliases or nicknames.
  • The current day, month and year.
  • A statement attesting to being of sound mind and body.
  • Healthcare instructions for events with no reasonable expectation for recovery or quality of life, which may include CPR, DNR (do not resuscitate) and do not intubate (DNI).
  • The name of your healthcare proxy, the person who you want to communicate and state your wishes and the name of an alternate healthcare proxy, if you have one.
  • Witness statements indicating you willingly and rationally signed this document (the number of witnesses varies by state).
  • Your legal signature.

An advance directive is not the same thing but can include a living will. The advance directive has two parts: the living will and the healthcare power of attorney. These documents don’t address finances, property distribution, guardianship of children or any non-medical matters. For those, you need a last will and testament.

The healthcare power of attorney is a document identifying the person named to make healthcare decisions for you. It’s sometimes called a durable medical power of attorney. The person you name to make decisions is called your healthcare proxy, healthcare agent, or healthcare surrogate. This document does not address end-of-life care, but instead grants legal permission to the person to make decisions for you.

The living will, advance directive and healthcare power of attorney work together to allow someone else to represent you during a medical crisis. These documents should be created by an experienced estate planning attorney and shared with the people you choose, so they may act on your behalf. Unfortunately, we never know when a medical crisis or accident will occur, so these documents are needed at any age and stage of life.

Reference: healthline (Sep. 1, 2022) “What Is a Living Will and Do I Need One?”

Why Is a Will So Important?

Why Is a Will So Important?

A 2020 Gallup poll found that less than half of Americans have a will or have made plans regarding how they would like their money and estate handled in the case of their death. The poll also showed that Americans ages 65 and up are the most likely to have one.

Yahoo News’ recent article entitled “How To Write A Will: The Importance Of A Will And Living Will” says that no matter your age, it’s important to have a will to be in control of what happens with your own assets. A will is a legal document that establishes a person’s wishes regarding the distribution of their assets — money, real estate, etc. — and the care of any minor children.

Without this type of legal document, the state law may control who gets your “probate” assets and when. Having one can save an enormous amount of time and money in estate administration and the process of having a guardian appointed for your minor children, if needed.

There’s a big difference between a will and a living will. A living will is a document that lets you state in advance how you want to be treated under certain medical situations, if you’re unable to make those decisions for yourself at a later time.

These differ by state law. However, they generally cover end-of-life decision-making and treatment options. General medical decisions unrelated to end of life care are typically covered in a health care power of attorney. Some states combine these two documents into one directive.

Unlike a living will, which specifically provides instructions for medical care during your lifetime, it lets you to decide in advance who you want to receive your assets upon your death, and who you want to be in charge of handling the administration of your estate. If you have minor children, it also allows you to nominate a guardian for them.

When creating a will, think about the “what,” the “who” and the “how.” To do so, ask yourself the following questions:

  • What assets do you have?
  • To whom do you want to leave them?
  • Who do you want to be in charge of making sure that happens?
  • Who do you want to be responsible for your minor children?
  • How do you want the assets transferred?

Reference: Yahoo News (Aug. 17, 2022) “How To Write A Will: The Importance Of A Will And Living Will”

Why You Need an Estate Plan

Why You Need an Estate Plan

Did you think you had to be rich to have an estate? Think again! From a legal perspective, your estate includes everything you own, from tangible property like a car, house, furniture, as well as intangible assets like insurance policies, bank accounts, retirement and investment accounts. You don’t have to be rich to have an estate, says the recent article “How to Plan Your Estate” from The Military Wallet. However, you do need to have an estate plan, and the best time to start planning is right now.

An estate plan is more than simply passing your property along to heirs. It is also how you prepare for the unpleasantries of life, including becoming incapacitated or being unable to make decisions on your own.

Your estate plan protects you and your beneficiaries. Without a will, the court will determine who will get your assets subject to probate, following the laws of your state. With a will, you determine who should receive your probated property, from family members to charities.

Your estate plan protects your children. Your will nominates a guardian who will care for your children if you die before they turn age 18, or, if you have a disabled child with special needs, who will care for them for the rest of their life. Without a will nominating a guardian, the court will make these decisions.

Your estate plan protects your family by preventing conflict. Your wishes are made clear in a will and in other estate planning documents. The more details, the better. No one can say they knew what you really wanted, because what you really wanted is documented and memorialized in your estate plan.

Getting ready to meet with an estate planning attorney will be easier if you take it step by step.

Make an inventory of all assets, including

  • House, land and any real estate property
  • Cars, boats and any other vehicles
  • Bank, investment and retirement accounts
  • Life insurance policies
  • Health savings accounts
  • Jewelry, valuables and collectibles
  • Digital assets, including website URL, username and password
  • Cryptocurrency, including all information for an executor to be able to access accounts

Create a plan for the different scenarios in your life. Who would you want to raise your children if you and your spouse die while children are minors or are unable to care for them because of illness or injury? How will your spouse pay the mortgage if you die unexpectedly?

Make a list of all accounts with designated beneficiaries. This typically includes life insurance, retirement plans and annuities. Any time you have a major life event like marriage, divorce, birth or death, these designations should be reviewed.

You’re now ready to meet with an estate planning attorney. Your estate plan should include a last will and testament, outlining who should receive your property, who will distribute your estate (your executor) and who should raise your children if you die while they are under legal age.

A Health Care Proxy is used to name a person who can make decisions about your healthcare if you cannot. A Living Will outlines the details for medical treatment you want or don’t want when you are near death.

Power of Attorney is a document giving someone else the power to take care of your finances at any point, if you can’t because of illness or incapacity. This avoids your family members having to go to court to obtain a guardianship, which takes time and is a costly proceeding.

Reference: The Military Wallet (Aug. 25, 2022) “How to Plan Your Estate”