By Executor's Resource, Inc.
In case you missed the action in June, here’s a listing of the Top 5 Estate Planning tweets (from our perspective) for June 2010:
1. @Jack65203 Banks are offering comprehensive care to their clients as a way to deepen ties with their clients. Via @wsj http://ht.ly/2452s #estate planning
2. @EstateLogic From good to great: your #estate #plan. http://bit.ly/azpqpO
3. @BlackLewisLaw 5 #Property Types that Cannot Be Left in a #Will http://ht.ly/22LPo #estateplanning #estate #planning
4. @trustlawgroup RT @lichtermanlaw Cost of raising a child: $475,680 - this is why life insurance and proper estate planning is critical http://ow.ly/1WqGg
5. @FAmagazine Financial Advisors Spending More Time On Clients' Kids: Advisors are dedicating more time to the spending and savi... http://bit.ly/cszh5N
Tuesday, June 29, 2010
Friday, June 25, 2010
Take your estate plan from good to great
By Executor's Resource, Inc.
Many people seem to think that having an estate plan simply refers to having legal documents. While it’s absolutely true that the right legal documents are critically important, we believe that there are four components overall that when addressed, can take an estate plan from good to great and make it a true gift to your loved ones:
1) The power to carry out your wishes. Appropriate, up-to-date (e.g., reviewed every two years and modified as needed) legal documents for your situation including:
3) You’re more than your money. Documenting your legacy – all the important personal stories, accomplishments, and heritage information that you want passed to the next generation. Some studies show that this component is often more important to many people than financial assets.
4) Talk. Listen. Repeat. Some people may find this step to be the most difficult of all. However, the true measure of a plan is in how well it can be implemented. Periodic and ongoing communication to tell your executor, personal representative or trustee about your preferences, viewpoints and wishes is critical in smoothing the often troubled waters of settlement.
We want to hear from you.
How does your estate plan stack up in light of these four components?
Leave a comment and let's get the dialogue started.
Many people seem to think that having an estate plan simply refers to having legal documents. While it’s absolutely true that the right legal documents are critically important, we believe that there are four components overall that when addressed, can take an estate plan from good to great and make it a true gift to your loved ones:
1) The power to carry out your wishes. Appropriate, up-to-date (e.g., reviewed every two years and modified as needed) legal documents for your situation including:
- Last Will and Testament
- Living Will
- Healthcare Power of Attorney
- Financial Power of Attorney
- Trusts, for some individuals (If you are interested in determining whether a trust is right for you, contact your estate attorney to discuss your goals and options.)
3) You’re more than your money. Documenting your legacy – all the important personal stories, accomplishments, and heritage information that you want passed to the next generation. Some studies show that this component is often more important to many people than financial assets.
4) Talk. Listen. Repeat. Some people may find this step to be the most difficult of all. However, the true measure of a plan is in how well it can be implemented. Periodic and ongoing communication to tell your executor, personal representative or trustee about your preferences, viewpoints and wishes is critical in smoothing the often troubled waters of settlement.
We want to hear from you.
How does your estate plan stack up in light of these four components?
Leave a comment and let's get the dialogue started.
Monday, June 14, 2010
Why have an estate plan?
By Executor's Resource, Inc.
A recent study showed that in today's economy, more and more people see estate planning as "discretionary" - something that can be put off until times are better. Unfortunately, disaster doesn't know the difference between a bullish or bearish stock market, or an employed versus unemployed person. Simply put, the benefits of having a current, up-to-date estate plan far outweigh what happens if you don’t.
Let's start with addressing what an estate plan does. An estate plan helps to see that your loved ones are provided for after your death in accordance with your preferences and instructions. People create estate plans for a variety of reasons.
Some people have a strong desire to avoid probate. Remember, probate is simply the legal process whereby a court appointed person – typically a close family member or friend, but sometimes an attorney or other professional – identifies all of your assets and liabilities and their value, pays your final bills, and distributes what’s left your assets to your heirs according to law.
In Colorado where Executor's Resource is headquartered, it’s actually quite a simple process. In some other states it can be a little more complex.
If you want to know what strategies will help you better manage probate, a qualified estate planning attorney can assist you. This could include making sure your beneficiary designations on your financial accounts and insurance policies are completed properly to even considering various types of trusts. For more information, read our prior posting called Probate 411.
Some people create an estate plan to make sure that their assets will be transferred in a tax efficient manner. This year, there is no federal estate tax; however, unless Congress acts, next year the federal estate tax will apply for estates with over $1 million in assets.
Historically, only a small percentage of the population has paid federal estate tax, but this will be something for us all to keep our eye on. For those of you who own a house, have a 401(k) plan, modest insurance coverage and personal property, it may not be hard to surpass $1 million. As an important note, the residents of 15 or so states also may owe a state estate tax.
Others who may be worried about creditors or the privacy of their estate settlement might find value in having a trust. Again, you'll want to seek qualified legal assistance in creating an advanced technique like a trust.
Most importantly, an estate plan helps to ensure that your wishes and instructions are carried out in the manner you specify, that family harmony is maintained, and that your loved one's burden in settling your affairs is minimized in their time of grief.
Simply put, your death will be much easier on your family if you have a plan. In our next posting, we'll discuss the four components of a good estate plan.
A recent study showed that in today's economy, more and more people see estate planning as "discretionary" - something that can be put off until times are better. Unfortunately, disaster doesn't know the difference between a bullish or bearish stock market, or an employed versus unemployed person. Simply put, the benefits of having a current, up-to-date estate plan far outweigh what happens if you don’t.
Let's start with addressing what an estate plan does. An estate plan helps to see that your loved ones are provided for after your death in accordance with your preferences and instructions. People create estate plans for a variety of reasons.
Some people have a strong desire to avoid probate. Remember, probate is simply the legal process whereby a court appointed person – typically a close family member or friend, but sometimes an attorney or other professional – identifies all of your assets and liabilities and their value, pays your final bills, and distributes what’s left your assets to your heirs according to law.
In Colorado where Executor's Resource is headquartered, it’s actually quite a simple process. In some other states it can be a little more complex.
If you want to know what strategies will help you better manage probate, a qualified estate planning attorney can assist you. This could include making sure your beneficiary designations on your financial accounts and insurance policies are completed properly to even considering various types of trusts. For more information, read our prior posting called Probate 411.
Some people create an estate plan to make sure that their assets will be transferred in a tax efficient manner. This year, there is no federal estate tax; however, unless Congress acts, next year the federal estate tax will apply for estates with over $1 million in assets.
Historically, only a small percentage of the population has paid federal estate tax, but this will be something for us all to keep our eye on. For those of you who own a house, have a 401(k) plan, modest insurance coverage and personal property, it may not be hard to surpass $1 million. As an important note, the residents of 15 or so states also may owe a state estate tax.
Others who may be worried about creditors or the privacy of their estate settlement might find value in having a trust. Again, you'll want to seek qualified legal assistance in creating an advanced technique like a trust.
Most importantly, an estate plan helps to ensure that your wishes and instructions are carried out in the manner you specify, that family harmony is maintained, and that your loved one's burden in settling your affairs is minimized in their time of grief.
Simply put, your death will be much easier on your family if you have a plan. In our next posting, we'll discuss the four components of a good estate plan.
Friday, June 11, 2010
Without a will, there’s no way
By Executor's Resource, Inc.
Millions of Americans don’t have basic estate planning documents. A recent study showed that only 35% have a Last Will and Testament, and only 29% of us have financial or healthcare power of attorney documents. Some reasons offered by the study for not having these documents:
• 1 in 5 people (20%) thought that their assets would automatically transfer to their spouse or family
• Another almost 20% thought it was too expensive
• 11% didn’t believe it was necessary
• 9% thought it just took too much time.
If you die without a will
Each state has its own laws that govern what happens to your property and your dependents. If you own property in multiple states, both sets of laws will need to be followed, and they could be different. The legal term for this type of law is “intestacy laws”.
Generally, intestacy laws specify a ranking or order for which your assets will be distributed after you pass. A general rule of thumb in thinking about these laws and the ranking or order that typically exists is:
Assets will transfer to your spouse first.
If you don’t have a spouse, then your children are next in line.
If you have no children, then your parents – if they are still alive -- receive your assets.
If you have no living parents, then your brothers and/or sisters.
If you were an only child or your siblings aren’t alive, then your nieces and nephews stand next in the order to receive assets.
How does this sound to you? Many people would probably agree that this order isn’t well-aligned with their actual intent. This not only applies to your financial assets but also to your precious items of personal importance.
Another major issue is applicable for those with minor children. If you and your spouse/partner pass at the same time and there is no will, the court will appoint a guardian. Most, if not all loving parents would agree that this would be a highly undesirable situation. This has an even greater impact for unmarried couples with minor children.
Bottom line
Bottom line? Without a will or appropriate legal documents, there’ll be no way to identify or honor your intentions.
For those of you out there who lack these basic documents, check out our posting on 7 ways to find an estate planning attorney, and what questions to ask to identify the right professional for you.
Get it together!
Starting to gather and organize all of your important documents and thinking through your preferences now can save you time and money in the estate planning process. Our EstateLogic® program helps you do just that. Watch our 2-minute video tour to see how we can help.
Millions of Americans don’t have basic estate planning documents. A recent study showed that only 35% have a Last Will and Testament, and only 29% of us have financial or healthcare power of attorney documents. Some reasons offered by the study for not having these documents:
• 1 in 5 people (20%) thought that their assets would automatically transfer to their spouse or family
• Another almost 20% thought it was too expensive
• 11% didn’t believe it was necessary
• 9% thought it just took too much time.
If you die without a will
Each state has its own laws that govern what happens to your property and your dependents. If you own property in multiple states, both sets of laws will need to be followed, and they could be different. The legal term for this type of law is “intestacy laws”.
Generally, intestacy laws specify a ranking or order for which your assets will be distributed after you pass. A general rule of thumb in thinking about these laws and the ranking or order that typically exists is:
Assets will transfer to your spouse first.
If you don’t have a spouse, then your children are next in line.
If you have no children, then your parents – if they are still alive -- receive your assets.
If you have no living parents, then your brothers and/or sisters.
If you were an only child or your siblings aren’t alive, then your nieces and nephews stand next in the order to receive assets.
How does this sound to you? Many people would probably agree that this order isn’t well-aligned with their actual intent. This not only applies to your financial assets but also to your precious items of personal importance.
Another major issue is applicable for those with minor children. If you and your spouse/partner pass at the same time and there is no will, the court will appoint a guardian. Most, if not all loving parents would agree that this would be a highly undesirable situation. This has an even greater impact for unmarried couples with minor children.
Bottom line
Bottom line? Without a will or appropriate legal documents, there’ll be no way to identify or honor your intentions.
For those of you out there who lack these basic documents, check out our posting on 7 ways to find an estate planning attorney, and what questions to ask to identify the right professional for you.
Get it together!
Starting to gather and organize all of your important documents and thinking through your preferences now can save you time and money in the estate planning process. Our EstateLogic® program helps you do just that. Watch our 2-minute video tour to see how we can help.
Monday, June 7, 2010
Finding the estate attorney that’s right for you
The right due diligence goes a long way
By Executor's Resource, Inc.
In our last posting, we discussed the importance of interviewing a pool of estate attorney candidates prior to selecting a practitioner who is right for you. Holding interviews with estate attorney candidates prior to purchasing services is a natural and appropriate thing to do, and ought to result in a better experience – for both you and the practitioner.
After all, this is typically not an immaterial purchase. And it shouldn’t be a one-and-done experience. You’ll be relying on this professional over your lifetime to give you advice on how to best protect your family and the assets you have worked so hard to build. In addition, he or she will also likely be helping your family to settle your estate at some time in the future.
You’re buying experience and advice. Perhaps you’re permitting this practitioner to provide the discipline you need (via reminders and follow up) to make some tough decisions.
Bottom line – when things get intimate you’re going to need to feel comfortable.
All the more reason for you to select someone you like, trust and respect.
Let’s talk about what to say and what to ask.
Breaking the ice
Plan to start the conversation by letting the attorney know the goal of your meeting and your timeframe for selection. Some suggested language:
Next open the conversation to the main areas of information gathering. Consider asking the following questions:
“Before you go” TIP
Most attorneys have websites where they provide a wealth of information about their practice, their approach on certain issues, and their education and experience, among other topics. They may even have a blog, Facebook or Twitter account where you can see some of their dynamic thinking in action. Plan to visit your candidates’ sites prior to meeting with them.
We want to hear from you
Have some stories you’d like to share with on why you like working with your estate attorney? Leave a comment here or follow us and share on Facebook at Executor’s Resource.
By Executor's Resource, Inc.
In our last posting, we discussed the importance of interviewing a pool of estate attorney candidates prior to selecting a practitioner who is right for you. Holding interviews with estate attorney candidates prior to purchasing services is a natural and appropriate thing to do, and ought to result in a better experience – for both you and the practitioner.
After all, this is typically not an immaterial purchase. And it shouldn’t be a one-and-done experience. You’ll be relying on this professional over your lifetime to give you advice on how to best protect your family and the assets you have worked so hard to build. In addition, he or she will also likely be helping your family to settle your estate at some time in the future.
You’re buying experience and advice. Perhaps you’re permitting this practitioner to provide the discipline you need (via reminders and follow up) to make some tough decisions.
Bottom line – when things get intimate you’re going to need to feel comfortable.
All the more reason for you to select someone you like, trust and respect.
Let’s talk about what to say and what to ask.
Breaking the ice
Plan to start the conversation by letting the attorney know the goal of your meeting and your timeframe for selection. Some suggested language:
- I’d like to create (or update) the estate planning legal documents that are appropriate for my situation.
- I’ve identified several attorneys, including you, with whom I’m speaking in order to get a sense for how you work and what I might expect as a client should I retain your services.
- My goal is to conclude my conversations within two weeks (personalize for your timeframe) and then select the attorney with whom I’d like to work.
Next open the conversation to the main areas of information gathering. Consider asking the following questions:
- What is your background, education and experience? What drew you to the field of estate planning?
- What are the major services you presently provide? Do you see that changing in the future? (For instance, the attorney may provide other services than estate planning, or might assist with legal documentation creation, but not with implementation – that is, probating the estate or some of the other activities that are potentially necessary during settlement.)
- Are you a general estate planning practitioner or do you have an area of specialty or focus (e.g., trusts and more advanced estate planning issues, experience with special needs, elder care issues, experience with family businesses)?
- Are you a sole practitioner or part of a larger firm? What support resources are available to assist you?
- If there are junior attorneys or paralegals on your team, what is the division of labor? How is work delegated, and who would be my primary contact?
- Do you have any preferences in how you do estate plans (e.g., simple wills versus trusts)?
- Do you charge by the hour, for a package of legal documents, or some combination of the two? What are your fees, on average?
- Do you have a sample package that I could review while I’m here in your office so I can get a sense for what the “end product” looks like?
- What happens to my documents once they are created/updated? Do you keep a copy here at your office?
- What is the process for periodic review and update of legal documents? Do you offer an ongoing maintenance program so that as my life changes I can update my documents? What are associated fees, on average?
- Can you give me a preview of some common things that you’re telling clients right now, given the uncertainty in the estate tax environment?
“Before you go” TIP
Most attorneys have websites where they provide a wealth of information about their practice, their approach on certain issues, and their education and experience, among other topics. They may even have a blog, Facebook or Twitter account where you can see some of their dynamic thinking in action. Plan to visit your candidates’ sites prior to meeting with them.
We want to hear from you
Have some stories you’d like to share with on why you like working with your estate attorney? Leave a comment here or follow us and share on Facebook at Executor’s Resource.
Friday, June 4, 2010
7 Ways to Find an Estate Attorney
Congratulations. You've finally decided to set up an appointment with an estate attorney to get your basic package of legal documents created. Problem is, you don't know an estate attorney.
Here are some ideas that can help you identify a pool of candidates with whom to speak (unless you live in a small town with only one practicing estate attorney). I use the term "pool of candidates" because it's only natural that you want the right blend of personality, style, specialty area and experience to suit your needs. While this list is not exhaustive, it should allow you to identify a few names:
1) Speak with your financial advisor or accountant. They will often have network of professional connections and can provide you a referral.
2) Talk to your friends, relatives and other trusted parties. Ask for recommendations and references as to why they thought a particular estate attorney was good.
3) Review your employee benefits or speak with your HR representative. Pre-paid legal assistance plans are popping up in worksites all across the country. They may offer discounts.
4) Check with your bank. Your bank or credit union may have a relationship with an estate attorney, which again could translate into savings.
5) Review the benefits offered through your life insurance policy. Some forward-thinking insurance companies like MetLife have begun to make estate attorneys available to group policy holders at a discounted rate.
6) Visit your local Chamber of Commerce website.
7) Last, but not least, the obvious -- do an online search. You can do a Google search for estate attorneys in your city or visit an attorney referral site like Lawyers.com.
Once you identify a pool of 3 to 5 candidates, it'll be time to conduct some interviews. It is perfectly fine and acceptable to have a phone call or meet in person with the estate attorney with whom you're contemplating a relationship.
Why? Remember, the concept of one-and-done estate planning is old hat. Plan to be working with this professional over your lifetime to regularly review (every two years) and make relevant updates to your legal documents.
In our next posting, we'll address how to prepare for your interview and what questions to ask.
Here are some ideas that can help you identify a pool of candidates with whom to speak (unless you live in a small town with only one practicing estate attorney). I use the term "pool of candidates" because it's only natural that you want the right blend of personality, style, specialty area and experience to suit your needs. While this list is not exhaustive, it should allow you to identify a few names:
1) Speak with your financial advisor or accountant. They will often have network of professional connections and can provide you a referral.
2) Talk to your friends, relatives and other trusted parties. Ask for recommendations and references as to why they thought a particular estate attorney was good.
3) Review your employee benefits or speak with your HR representative. Pre-paid legal assistance plans are popping up in worksites all across the country. They may offer discounts.
4) Check with your bank. Your bank or credit union may have a relationship with an estate attorney, which again could translate into savings.
5) Review the benefits offered through your life insurance policy. Some forward-thinking insurance companies like MetLife have begun to make estate attorneys available to group policy holders at a discounted rate.
6) Visit your local Chamber of Commerce website.
7) Last, but not least, the obvious -- do an online search. You can do a Google search for estate attorneys in your city or visit an attorney referral site like Lawyers.com.
Once you identify a pool of 3 to 5 candidates, it'll be time to conduct some interviews. It is perfectly fine and acceptable to have a phone call or meet in person with the estate attorney with whom you're contemplating a relationship.
Why? Remember, the concept of one-and-done estate planning is old hat. Plan to be working with this professional over your lifetime to regularly review (every two years) and make relevant updates to your legal documents.
In our next posting, we'll address how to prepare for your interview and what questions to ask.
Wednesday, June 2, 2010
Probate 411
In a prior posting, we provided a probate 411 of sorts. To continue along those lines, let’s define a couple terms you’ll need to know when contemplating probate:
Executor: This is the person, usually a family member, husband, wife or friend who gets stuck with all of the administrative work of settling an estate. It could involve processing paperwork involved with a 401(k) settlement, writing checks to real estate agents, attorneys, repairmen, and auctioneers, and it always involves a lot of communication. If there’s a will, the court typically appoints the executor named by the deceased. If a person dies without a will – or intestate – the court appoints an executor based on a priority list set forth by the legislature. States may call them something different. For example, they are called “personal representatives” in Colorado. Note that if a trust is involved, there is a "trustee" or several trustees. This is a different role than that of an executor or personal representative.
Assets: Your assets include any real estate that you own, as well as any personal property such as art, cars, an antique collection, stocks (in public or privately owned shares), bonds, business interests, retirement accounts and life insurance policies. Don't forget the digital assets like Pay Pal accounts or monetized blogs, websites, even your email, Facebook and Twitter accounts. Many people believe they have no “estate,” when in reality, they do.
Probate court: This is a division of your county’s court system, complete with clerk’s office, courtrooms, judges and all the record keeping functions.
So now that we have some basics down, let’s answer a few helpful questions.
What passes through probate and what doesn’t?
Assets that typically follow the path of probate include:
Some people arrange their property so that it completely bypasses probate, using a variety of techniques, such as signing forms on their bank and retirement accounts that cause money to go directly to beneficiaries (other than their estate); gifting assets before death and using revocable living trusts.
Others have all of their assets distributed via probate. To find out what avenue might work best for your personal situation, you might consider speaking with a financial planner who specializes in estate planning, or an estate attorney.
No probate = no taxes = MYTH!
A common myth is that if you can avoid probate, you can avoid taxation. This is not the case. Assets that are part of your probate estate, along with assets that pass outside of probate are considered part of your gross estate. Your gross estate is used to calculate any estate tax you may owe. The only way to completely avoid estate taxation on an asset is to simply not own it or any interest in it at the time of your death.
Even assets that pass to your beneficiaries outside of probate are subject to estate tax. If taxation is a driving force behind your probate concerns, it may be in your best interest to meet with an estate attorney or financial planner that specializes in estate planning to uncover and identify your goals for your estate and design strategies for how to best achieve them.
Executor: This is the person, usually a family member, husband, wife or friend who gets stuck with all of the administrative work of settling an estate. It could involve processing paperwork involved with a 401(k) settlement, writing checks to real estate agents, attorneys, repairmen, and auctioneers, and it always involves a lot of communication. If there’s a will, the court typically appoints the executor named by the deceased. If a person dies without a will – or intestate – the court appoints an executor based on a priority list set forth by the legislature. States may call them something different. For example, they are called “personal representatives” in Colorado. Note that if a trust is involved, there is a "trustee" or several trustees. This is a different role than that of an executor or personal representative.
Assets: Your assets include any real estate that you own, as well as any personal property such as art, cars, an antique collection, stocks (in public or privately owned shares), bonds, business interests, retirement accounts and life insurance policies. Don't forget the digital assets like Pay Pal accounts or monetized blogs, websites, even your email, Facebook and Twitter accounts. Many people believe they have no “estate,” when in reality, they do.
Probate court: This is a division of your county’s court system, complete with clerk’s office, courtrooms, judges and all the record keeping functions.
So now that we have some basics down, let’s answer a few helpful questions.
What passes through probate and what doesn’t?
Assets that typically follow the path of probate include:
- Any asset (financial like a brokerage or checking account or physical like a car or personal residence) that you, as an individual, own outright at the time of your death, and that does not have a beneficiary designation
- Any assets like life insurance or a retirement account that you specified through a beneficiary designation should go to your estate after your death
- Your share of a joint asset, usually in association with real estate or a home, titled in the form of “tenants in common”
Some people arrange their property so that it completely bypasses probate, using a variety of techniques, such as signing forms on their bank and retirement accounts that cause money to go directly to beneficiaries (other than their estate); gifting assets before death and using revocable living trusts.
Others have all of their assets distributed via probate. To find out what avenue might work best for your personal situation, you might consider speaking with a financial planner who specializes in estate planning, or an estate attorney.
No probate = no taxes = MYTH!
A common myth is that if you can avoid probate, you can avoid taxation. This is not the case. Assets that are part of your probate estate, along with assets that pass outside of probate are considered part of your gross estate. Your gross estate is used to calculate any estate tax you may owe. The only way to completely avoid estate taxation on an asset is to simply not own it or any interest in it at the time of your death.
Even assets that pass to your beneficiaries outside of probate are subject to estate tax. If taxation is a driving force behind your probate concerns, it may be in your best interest to meet with an estate attorney or financial planner that specializes in estate planning to uncover and identify your goals for your estate and design strategies for how to best achieve them.
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