Posts Categorized: Trusts

Key Milestones For Planning Your Retirement

The key to having a comfortable retirement is to save as much as possible as early in your career as possible. Time, tax breaks, and compounding interest all add up, and by getting into the habit of saving when you are young, it will be exponentially easier to reach vital retirement goals as you get older.

With this in mind, one of the most important things you can do at this age is to take full advantage of employer-sponsored retirement accounts, such as 401(k)s, 403(b)s, IRAs, and other tax-advantaged plans, especially if your employer offers a match. A common rule of thumb is that you should save at least 15% of your pre-tax income each year. If that’s not possible, then save as much as you can – and at least enough to get the full benefit of your employer’s matching contribution if one is offered.  READ MORE

Estate Planning Lessons We Can Learn from Encanto

Like the Madrigal family, you can use your estate plan to benefit the world around you. You can design your plan so that the money and property you leave will cultivate a legacy that will not only impact your immediate family but can also benefit the community for generations to come. The Carnegie Foundation, which funds libraries and learning centers around the country, and the Bill & Melinda Gates Foundation, which fights poverty, disease, and inequity worldwide, are well-known examples.

But you do not have to be a billionaire to establish a family foundation. In its simplest terms, a family foundation is a means of providing charity that is funded with family assets and often employs family members to work for its cause. Family foundations are an effective way to involve your family in establishing a charitable legacy that can benefit the community. READ MORE

10 Common Estate Planning Mistakes Your Family Can’t Afford to Make – Part 2

Without a thorough understanding of how the legal process works upon your death or incapacity, along with knowing how it applies specifically to your family dynamics and the nature of your assets, you’ll likely make serious mistakes when creating a DIY will or trust. And the worst part is that these mistakes won’t be discovered until you are gone – and the very people you were trying to protect will be the ones stuck cleaning up the mess you created just to save a few bucks. 

Estate planning is definitely not a one-size-fits-all endeavor. Even if you think your particular situation is simple, that turns out to almost never be the case. To demonstrate just how complicated estate planning can be, last week in part one, we highlighted the first five of 10 of the most common estate-planning mistakes, and here we wrap up the list with the remaining five mistakes. READ MORE

Dutiful Child or Manipulator of the Elderly?

As parents age and their physical and mental capacities diminish, it is natural for their adult children recognizing the parents’ decreasing ability to care for themselves, to step in and help them. Often, a specific child will take over the responsibilities, such as taking the parent to doctor’s appointments or the attorney’s office. As the parent begins to depend on the child more and more, it may make sense to appoint the child as a trusted decision-maker and even give them a larger inheritance to compensate them for their time. At the same time, other family members must take extreme care to ensure that a manipulative caretaker is not exploiting the elderly parent.

With more people living into their eighties and nineties, elder abuse is a serious and increasingly common problem in our society. Elder abuse can take several forms, including physical, sexual, emotional, and verbal abuse or caretaker neglect or exploitation. Up to one-half of all elder abuse in the United States is financial exploitation, which is the aspect this article focuses on. Financial exploitation includes outright theft of money or property, illegal transfers of property, identity theft, and misusing a position of trust, such as through a power of attorney. READ MORE

10 Common Estate Planning Mistakes Your Family Can’t Afford to Make – Part 1

If you die without an estate plan, the court will decide who inherits your assets, which can lead to all sorts of problems. Our state’s intestate succession laws determine who is entitled to your property, which hinges largely upon whether you are married or have children. Spouses and children are given top priority, followed by your other closest living family members.

If you are single with no children, your assets typically go to your parents and siblings and then more distant relatives if you have no living parents or siblings. If no living relatives can be located, your assets go to the state. It’s important to note that state intestacy laws only apply to blood relatives, so unmarried partners and close friends would get nothing. If you want someone outside of your family to inherit your assets, having a plan is an absolute must. READ MORE

Make Sure Your Kids Are Prepared with This Summer Camp Checklist

This year, summer camps are expected to be back in full swing after two pandemic summers forced them to close or operate at limited capacity. Camp is an excellent opportunity for kids to make new friends, try new activities, and gain self-confidence and resilience. But as parents and counselors know, a lot of preparation goes into making lasting summer camp memories.

Camp is a unique experience because it may be the only time during the year that kids are away from home – and parental supervision – for an extended period. Although the time spent apart can be positive for the parent-child relationship, there are several contingencies that families should plan for ahead of time. After your child is off at camp, it may be too late to update contact information, medication lists, and temporary guardianship permissions. READ MORE

How Creating A Life & Legacy Plan With Us Creates And Preserves Your Family’s Legacy

Best of all, the Family Wealth Legacy Process is offered at no additional cost to you, since it is part of each plan we create for our clients. And the process of documenting this recording is as easy and convenient as possible: We use a series of helpful questions and prompts, which makes the process both easy and enjoyable. From start to finish, the entire process takes less than an hour. 
My favorite part about this process is that most of our clients tell us that going through it helps them rekindle life moments and memories they would otherwise not share with their loved ones. Indeed, this unique process can enrich your family with something far more valuable than any tangible asset you might leave, and instead leave behind a lasting legacy of love.  READ MORE

Silent Trusts: Could I Be the Beneficiary of a Trust and Not Know It?

After a trust has been created, the trustee has specific legal duties to the beneficiaries. Although a trustee’s duties vary by state, in most states, a trustee must disclose the trust’s existence, identify themselves as the trustee, and send the beneficiaries yearly accounting statements on request with information about the trust’s assets (accounts and property), taxes, distributions, and performance.

A silent trust eliminates the legal requirement that the trustee tells the beneficiaries about the trust’s existence or terms for a period of time. Typically, a silent trust’s terms will provide a triggering event, such as the beneficiary reaching a certain age or achieving a particular milestone or the trustmaker’s death or incapacity. The trustee’s obligations to inform the beneficiary begin only upon the occurrence of the triggering event. READ MORE

3 Reasons Why Transferring Ownership Of Your Home To Your Child Is A Bad Idea

Another drawback to transferring ownership of your home in this way is the potential tax liability for your child. If you’re elderly, you’ve probably owned your house for a long time, and its value has dramatically increased, leading you to believe that by transferring your home to your child, they can make a windfall by selling it. And by transferring the property before you die, you may think that you can save your child both time and money by avoiding the need for probate.

Probate is the court process used to distribute your assets according to the wishes outlined in your will or according to our state’s intestate succession laws if you don’t have a will. Depending on the complexity of your estate, probate can be a long and expensive process for your loved ones; however, that expense is likely to be relatively minor compared to the tax bill your heirs could face. READ MORE

Does a Domestic Partner Have the Same Rights as a Spouse When It Comes to Estate Planning?

Everyone knows what a marriage is, but not everyone knows what a domestic partnership is. To answer whether domestic partners have the same estate planning rights as married spouses, it is helpful to define what a domestic partnership is.

A domestic partnership is an alternative to marriage created for same-sex couples who could not legally marry. However, when the US Supreme Court legalized same-sex marriage in 2015 in Obergefell v. Hodges, marriage became an option for same-sex couples. A domestic partnership is not just for same-sex couples; any couple can choose this status when marriage is not something they desire, for whatever reason. READ MORE

Three Steps to Take When the Deceased Has Controlled Substances

If your loved one was living in an assisted living facility or was in hospice before their death, check with the healthcare staff to determine whether they will dispose of the unwanted or expired medications. If you learn that you are responsible for their disposal and there are no specific disposal instructions in the medication package insert, or you have not received detailed disposal instructions from a healthcare provider, follow the steps below.

The first step for properly disposing of a deceased person’s controlled substances is to determine whether there is a drug take-back site or program nearby. This is the best way to dispose of unwanted or expired medications. You can check the Drug Enforcement Agency (DEA) website or ask about possible options at your local pharmacy or police station. READ MORE

Protect Your Children’s Inheritance With A Lifetime Asset Protection Trust

Creating a will or a revocable living trust protects your kid’s inheritance. Still, in most cases, you’ll be guided to distribute assets through your will or trust to your children at specific ages and stages, such as one-third at age 25, half the balance at 30, and the rest at 35.

If you’ve created an estate plan, check to see if this is how your will or trust leaves assets to your children. If so, you may not have been told about another option to give your children access, control, and airtight asset protection for whatever assets they inherit from you. READ MORE

7 Last-Minute Moves To Save On Your Taxes For 2021

The American Rescue Plan’s expanded child tax credit was made fully refundable in 2021, and it was increased up to $3,600 per child through age five and up to $3,000 per child aged 6 to 17. Dependents who are 18 can qualify for $500 each. Dependents aged 19 to 24 may also be eligible, but they must be enrolled in college full-time. 

Eligible families automatically received half of the payments in advance monthly between July and December 2021 unless they opted out. When eligible parents file their taxes in 2022, they’ll get the remainder of the benefit they didn’t receive through advance monthly payments. If you did not receive the advance payments because you opted out or didn’t receive them for some other reason, you could claim the full credit when you file in April. READ MORE

When a Gift May Not Be a Gift

The federal tax code has particular rules about how much you are allowed to transfer to others each year – and throughout your lifetime – in the form of a gift. Any gifts above that amount may be subject to gift tax, paid by the giver. However, not every gift is subject to the gift tax. Annual exclusion amounts, a lifetime exemption amount, and other exclusions, such as education or medical exclusions, relieve a giver of paying federal gift taxes.

Because the lifetime exemption amount is very generous at this time, many people will not owe taxes on their gifts. However, high net worth individuals should be mindful of how gifting can affect the estate tax that may be due upon their death. READ MORE

Probate: What It Is & How To Avoid It – Part 2

Unless you’ve created an estate plan that works to keep your family out of court when you die (or become incapacitated), many of your assets must go through probate before those assets can be distributed to your heirs. Like most court proceedings, probate can be time-consuming, costly, and open to the public, and because of this, avoiding probate – and keeping your family out of court – is often a central goal of estate planning. 

To spare your loved one’s the time, cost, and stress inherent to probate, last week in part one of this series, we explained how the probate process works and what it would entail for your loved ones. In part two, we’ll discuss the significant drawbacks of probate for your family and outline how you can help them avoid probate with wise planning. READ MORE