Asset Preservation Archives | K.T. Williams Law

Elder Law: What Is It and Why Do I Do It? Part 1.

September 13, 2019/in Asset Preservation /by KT Williams

You may regularly hear about Elder Law and think you need it. And you would probably be right. But you may wonder what it is. Elder Law is many things, but here is some of what it is:

• Protecting your assets and income from nursing home and other age-related costs;
• Navigating the maze of rules and laws that govern how nursing home care is paid, including Medicaid, so you don’t have to navigate it alone;
• Protecting your friends and family from abuse or substandard care by caregivers;
• Helping you or your family understand and qualify for Medicaid;
• Working with you and your financial advisor, CPA, and insurer to coordinate an asset and income structure that will keep you and your family comfortable for your lifetime;
• Helping you stay at home and avoid the nursing home if staying home is important to you;
• Many more….

You can see that Elder Law is about more than nursing homes and applying for Medicaid. It is also about more than protecting your assets. While Elder Law often includes these things, it also includes much more, such as the quality of your golden years.

Elder Law Is More Than Applying For Medicaid.

Many people think Elder Law is simply applying for Medicaid. And Elder Law often includes applying for Medicaid. We’re here to help when Medicaid is needed and to apply for the Medicaid benefits to which our clients are entitled. But Elder Law also involves more than the application. It involves understanding Medicaid and other programs to which senior citizens and the elderly are entitled so that, long before Medicaid benefits are needed, we can prepare our clients to maximize those benefits and get what they are entitled to receive.

Elder Law is More Than Estate Planning.

Estate Planning is traditionally aimed at helping you pass assets to the beneficiaries that matter to you. If those beneficiaries need help managing the assets or if you want to protect the assets for them, trusts are often involved. Elder Law is that and more. Elder Law prepares us for the future we are likely to face before we pass. But it’s a future we sometimes don’t want to consider: in-home and nursing home care when we aren’t able to care for ourselves. Elder Law considers the rest of your life and how you want to pass your assets after your death.

Elder Law Considers Our Future Needs.

You want to be comfortable with the amount of assets and income you saved. Also, you want to be comfortable that your assets will pass to the beneficiaries who matter to you. But there are other important questions to consider: are you certain you will have enough assets and income to cover your needs before you pass? And are you certain there will be assets left over to pass to those who matter to you? In other words, are you sure your assets and income won’t be lost to pay for nursing home care as you age? If you go to a nursing home without proper planning, your hope to pass your assets to loved ones may be misplaced. Nursing home costs quickly consume assets and income, leaving nothing.

While we may think we won’t go to a nursing home, nursing home care for us is almost inevitable. Studies show that at least 70% of us are likely to require nursing home care. And with costs nearing $8,000 per month and higher in some areas, few can afford it. Elder Law guides you toward an asset and income structure that will help make sure you remain comfortable, well taken care of, and in the place you want to live.

Elder Law Helps Us Live Where We Want.

You want to be comfortable where you live as you age. Perhaps, that is your home. You want the comfort of your own home as you age. Or maybe assisted living appeals to you. You know it can be costly, but you realize the benefits of assisted living can’t be overstated. Either way, you don’t want to be forced into a nursing home because you lack the funds to get care in your home or to cover assisted living costs. Through Elder Law planning, we work to make that happen if it’s possible.

Why Do I Do Elder Law?

I want my client’s wishes to be carried out. If they want to pass assets to their family, I want to help them make sure they preserve those assets to pass. Also, I want them to get the benefits to which they are entitled. Unfortunately, many programs designed to benefit the elderly and their family aren’t user friendly. And the customer service aspect of some of the programs has been lost. Rather than helping people understand the programs and the available benefits, some employees of these programs act as gatekeepers, blocking people from the programs and benefits. That’s not acceptable. Everyone deserves an advocate, someone who will listen to them, care for them, and help them. They deserve to receive what they’re entitled to receive without being mistreated, ignored, or abused. And their family is entitled to be heard, too. So I do Elder Law to make sure voices are heard, to make sure people get the benefits to which they are entitled, and to make sure their wishes are carried out. I enjoy what I do. Contact us to see how I can help you or your family.

How To: Prepare for your Estate Planning meeting

September 6, 2019/in Asset Preservation, Estate Planning /by KT Williams

Important appointments like those for our annual physical with our physician or for going over our tax returns with our accountant can be intimidating and stressful. You might feel that way about your upcoming estate planning meeting, too. But you shouldn’t feel that way. Instead, realize that the meeting is a great step toward securing and controlling your future. And to make the most of the meeting, here are a few tips to help you prepare for it.

What Do You Want To Accomplish? What Are Your Goals?

One of the first things I plan to ask you is what you want to accomplish through our working together. Is it to make sure your assets pass to certain beneficiaries? Is it to limit taxes? Is it to protect your assets from nursing home costs? Is it to make sure your children or spouse are protected in the event you die young or otherwise unexpectedly? Is it a combination of several of these goals? Give it some thought before the meeting. It’s not necessary that you are certain of your goal. But it’s helpful if you have given it some thought. We will explore it more deeply in the meeting and help focus our attention on achieving your goal.

Consider Your Family’s Unique Dynamic.

All of us are unique, and our families are unique. So, you and your family should be treated uniquely. You deserve it. You shouldn’t be treated as if you were no different than everyone else who wants to plan their future. When we meet, I’ll ask you about your family. And it’s important for you to be honest. If you have someone who isn’t good with money, you should say so. If you have someone with substance abuse problems, you should say so. If you have someone, perhaps a child, whose spouse is overbearing, untrustworthy, or deceitful, you should say so. This will help us form a structure for your estate plan that will provide benefits without the risk that their uniqueness will cause problems.

Know Your Assets.

Identify your assets, their value, and how they are titled. In other words, have a good idea about what you have and in whose name it is owned. That will help us determine the best way for your assets to be protected and passed to your preferred beneficiary.

Think About Who You Trust and Want In Important Roles.

Who do you trust to do what is in your best interest? Will they take care of your family members, too? The executor of your estate identified in your Last Will and Testament should have good organization skills, be able to handle finances, and not give in to undue pressure that might come from someone who doesn’t have the estate or its beneficiaries’ interests as a priority. Your Attorney-in-Fact under your Power of Attorney should possess the same qualities as your executor, and they can be the same person. The authority of the Attorney-in-Fact will end when the person who gave the authority dies. If you have a trust, your trustee should possess these qualities, too. The trustee will manage the trust assets, handle them for the trust beneficiaries, and follow the directions contained in your trust. Obviously, the trustee must be someone who is trustworthy. You should be confident the trustee will do what you want and will follow the instructions in your trust for the trust’s beneficiaries.

It will help us with your planning if you have the contact information for your family members and any non-family members who you want to serve in an authority position like those identified here. Having that information at the planning meeting isn’t necessary, but it will be needed before the planning is completed.

Keep An Open Mind.

The planning that was done for your friends or family might be similar to what is appropriate for you. But don’t count on it. You are unique. Your assets are unique. Your goals may be unique. So, your planning should be appropriate for your unique circumstances. That means you need to keep an open mind about what planning may be most appropriate for you and strongly consider the recommendation that is made by the expert who is evaluating your situation and recommending the best way to handle it.

Ask Questions.

Ask questions if you don’t understand something about your estate planning or that is discussed in the estate planning meeting. I always try to fully explain the topics we cover in the meeting, but some of the topics are more complex than others and more difficult to explain and understand. Your questions may be the only way for me to know you don’t understand. I want you to be confident about what you’re doing and why you’re doing it. But it is hard to be confident if you don’t understand what is being done and why it is being done. Always feel free to ask questions until you have a solid understanding.

Make An Appointment.

Getting ready for your estate planning meeting starts with making an appointment. The goals that matter to you will not be achieved if you don’t begin the planning process. So, schedule your estate planning appointment. We’ll take you through the process and make it painless and enlightening. When we’re finished, you will have taken care of an important and necessary task for you and your family, and you will have relief and confidence that you’ve done it well. Contact us to get started.

Preparing For The Unexpected… Sickness, Death, Or Expense: What Should You Do – Part 2.

August 23, 2019/in Asset Preservation, Estate Planning /by KT Williams

The benefits of preparing for the unexpected are wide ranging. Avoiding delay, saving money, and earlier care in a health crisis are just a few. In Part 1 of this series, we talked about important first steps to prepare for the unexpected. These steps included making lists of important information such as your bank accounts, investment and retirement accounts, insurance policies, real estate and other assets. Also, you were encouraged to compile a list of all of your electronic login credentials with the corresponding password. Our electronic footprint and widespread use of electronic media, accounts, and storage (our photos in the cloud for example) makes it necessary for us to keep our account login credentials handy for our use and for use by those who may need to help us one day.

Now What? You compiled all the information. What do you do next? In this, Part 2 of the series, let’s cover what you should do after gathering the information.

Keep the information current and updated. You spent valuable time locating, sorting, and compiling the information. Make sure your efforts pay off. Keep the information handy, easily accessible, and up to date. Otherwise, your efforts could end up wasted if the information can’t be found when needed or if it isn’t updated regularly. None of us want to waste our effort. You should check the accuracy of the information every six (6) months or sooner if you get a new electronic account or if your login ID or password changes for any account.

Build Your Professional Advisor Team and Use It. Most people rely on trusted professionals to guide them. Each advisor plays a vital role. And just like other teams that have players with unique skill sets, the members of this team have unique skill sets that serve an important purpose. Leaving a member out of this team could leave you unprepared. If you don’t have a full team, build it. It’s easy. It only takes a call, email, or message. And if you aren’t sure who should be on your team, get suggestions from the other advisors you use.

Financial Advisor, Insurance Agent, CPA, And Estate Planning/Elder Law Attorney. This is your team, and they should work together for you. We each have unique skills and experience, and we use these skills and experience to help you and those who matter to you. When you talk to your team members, tell each one you want them working together.

Preparing for the unexpected in your life justifies spending a little time with these professionals who see the unexpected every day. Your financial advisor, insurance agent, CPA, and estate planning/elder law attorney have seen unexpected and surprising life experiences in their clients and friends and have learned from them. We use that learning to better advise you so that you can avoid the problems others have faced so that you can take advantage of opportunities others have missed. Preparing ahead and being proactive about your future is time, effort, and money well spent. It’s the kind of investment that pays off for a lifetime.

Inform Your Spouse or Power of Attorney. If you are married, you and your spouse may have worked together in gathering all of this information. That’s good. It’s easy to forget in our busy life to tell our spouse something they should know, such as details about retirement options, beneficiary designations, and insurance elections that we may have available. Gathering the information together can help bridge the gap and make sure each of you are aware of your property, accounts, insurance, and retirement benefits. Even if you didn’t gather the information together, you should tell your spouse how to find the information if you intend your spouse to use it one day. If you aren’t married or if you don’t intend for your spouse to access the information, make sure your Attorney-in-Fact (that is the person you named as your agent in your Durable Power of Attorney) can access it. They may need it to help you.

Make Sure You Can Answer These Questions. There are several questions that you should be able to answer. They help determine if you are well prepared for the unexpected. If you can’t answer these questions or if you aren’t certain of the answer, contact your team and get to work. It’s not OK to simply say “some of these questions don’t apply to me because I’m too old or because I’m young and I have plenty of time to worry about it later.” These questions are too important to ignore. Here are a few of them.

1. How are you going to pay for nursing home care? Statistics show that at least 70% of adults will need nursing home care. Nursing home care costs approximately $7,000 per month in our region, and the cost is increasing rapidly. You could use all of your savings and hard-earned assets. That doesn’t sound good to me, and it probably doesn’t sound good to you either. There are plenty of other options. The other options may not be available if you don’t plan ahead.

2. Who is going to assist you and make decisions for you if you become incapacitated? You need a capable, trustworthy person who will take care of your financial and health care needs.

3. Has your estate planning, including your Power of Attorney, been updated to comply with changes in the law and with advances in technology. For example, your Attorney-in-Fact should have authority to access the electronic accounts and memberships you’ve created. If that authority isn’t specifically stated in your Power of Attorney, your Power of Attorney should be updated.

4. Are you taking all of the tax deductions and income exclusions that are available to you? The tax code is complex, and its complexity continues to grow.

5. At what age will you retire and what will your retirement income be when you retire? These questions can be answered even if you are many years from retirement. Helpful tools exist to calculate these figures and to forecast important trends. And this isn’t only for people who are near retirement. If you are young, answering these questions will help you boost your income later and, perhaps, put you on the right track for higher income soon.

6. Do you have the insurance coverage that you need? Insurance is often overlooked, but it is an important part of preparing for the unexpected. The amount and type of health insurance, Medicare supplemental health policies, life insurance, long-term care insurance, or home and automobile coverage that we need varies from person to person and with our stage in life. Reviewing this regularly with your agent and professional team is important. You want the right coverage, not too much and not too little. Be proactive in managing your insurance coverage.

Planning ahead and preparing for the unexpected is time well spent. We never regret planning ahead. But we regret when we don’t. Time is available. Take action now. Don’t wait for the unexpected to happen. Contact us for help.

Preparing For The Unexpected. . . Sickness, Death, or Expense: What You Should Do – Part 1.

August 9, 2019/in Asset Preservation, Estate Planning /by KT Williams

It’s easy to be get caught up in everyday life. And when that happens, it’s easy to forget that life is more than what it happening to us at the moment. If we don’t prepare for what lies ahead, we may miss some important opportunities. Here is a list of steps you should take to be better prepared for some of life’s unexpected twists and turns.

Make a List of Your Accounts, Insurance, and Automatic Transactions

Make a list. That seems simple enough. But you would be surprised how few people do this. Nevertheless, it is one of the easiest ways to locate missing money and to identify unnecessary expenses. Here’s what you should do.

Gather the most recent monthly statement for each of the bank accounts and credit card accounts that you have. Print the newest statement for any accounts that only come electronically. Now, make a list of each account number, the account balance at the last statement date, the name of the account owner, the address, telephone number, and location of the financial institution holding the account, and the financial representatives who help you with the account. If you have a username and password to access an account electronically, make sure you have it listed in a safe place, too.

Follow a similar listing process for your investment accounts. Then, focus on your insurance. On the list for insurance, identify your insurance coverage and policies that are in force. Make a list of the type of insurance it is, the policy number, the agent, and the insurance company. If you have life insurance, include the amount of the death benefit, the identity of each designated beneficiary, and the cash value if the policy has cash value.

Finally, while you have your account statements handy, review them for automatic payments, such as monthly membership fees or premiums. Automatic payments that are deducted from our accounts usually stop when we cancel the service that generated the payment, but mistakes happen. If we’re not proactive about reviewing our monthly transactions, we might overlook a recurring withdrawal that shouldn’t occur any longer. So take a moment to review your statements for recurring charges that are in error. If you find any, immediately follow up with the vendor who charged your account and request a refund of over charges.

Make a List of Your Real Estate

If you don’t own any real estate or own very little real estate, this part of the list will be short. Include the owner’s name, property address, value, and mortgage amount. Include with this list a copy of the deed you received when you acquired the property and a copy of the mortgage, too. If you own multiple pieces of real estate, include all of them on the list.

Make a List of Your Personal Property

Yes. Make a list of your personal property, too. How detailed you make it is up to you, but the more detailed it is, the easier it will be to identify value. For example, items holding nostalgic value today may have seemed like junk just a few years ago. Vintage signs, dolls, toys, and action figures are just a few of the items that may have seemed worthless years ago, but may be nearly priceless today. I encourage you to keep a detailed list.

Include on this list any tools, equipment, and raw materials that you may have accumulated over the years. Whether as a job or a hobby, you might purchase special tools or equipment. And when your interest is highest, you might purchase extra raw materials or inventory for the activity. As your interest changes, it’s easy to forget about this equipment or material. But it’s value may remain or increase. So be certain to consider the hobbies and outside interests that you’ve pursued over the years. You could have quite a bit of value sitting on a shelf or resting in a storage building or warehouse.

Meet With Your Financial Advisor, CPA, and Attorney

Preparing for the unexpected in your life justifies spending a little time with the professionals who see the unexpected every day. Your financial advisor, CPA, and estate planning/elder law attorney have seen unexpected and surprising life experiences in their clients and friends and have learned from them. We use that learning to help us better advise you so that you can avoid the problems that others faced and so that you can take advantage of opportunities that others missed. Preparing ahead and being proactive about your future is time, effort, and money well spent. It’s the kind of investment that pays off for a lifetime. For help in preparing for the unexpected in your life, contact us, and stay tuned for Part 2 where we’ll explore other steps you should take.

Tough Questions Prompt More Thorough Estate Planning: Protecting Our Family.

July 19, 2019/in Asset Preservation, Estate Planning /by KT Williams

When thinking about assets and their estate plan, most people focus on who they want to receive the assets at death. And that is an important question to consider. Everyone should know who they want to receive their assets, and everyone should take steps to make sure the assets will reach them. But if we stop there, some unexpected and unfortunate outcomes may occur. Instead, we should consider some tough questions that may prompt more thorough planning.

What If Your Surviving Spouse Remarries or Finds a “Friend”: Will Your Assets and Family Be Protected?

It’s common for married couples, especially those couples who have enjoyed a long marriage, to say they want their spouse to receive all of their assets. Often, the beneficiary designations on retirement accounts and life insurance policies mirror this idea. One spouse is named as the beneficiary for the other. The end result will be that the surviving spouse owns and controls all of the property the couple accumulated.

The surviving spouse as the sole beneficiary may work out well. They may be a thoughtful, caring steward of the property. And perhaps the surviving spouse will only use the property for their needs and the needs of the couple’s children and grandchildren. But what if, unsuspectingly, the surviving spouse meets someone, and a relationship grows. This relationship could blossom into marriage or a deep “friendship.” How does the new relationship affect our estate planning perspective? Usually, it makes a big difference.

Because of the enormous impact a marriage or deep friendship could have on a surviving spouse’s perspective and use of the property, most people want their estate plan to protect what they leave behind. The protections will not deprive the surviving spouse of anything. The surviving spouse will benefit from the assets and have access to the assets for their needs. But the protections will limit the ability of the new spouse or “friend” to take the property for themselves. The end result is that the assets won’t be lost to this new spouse or friend, and the surviving spouse will benefit from the assets as intended.

What If Your Children Get Divorced or Die Much Younger Than You Expect: Do You Want Their Inheritance To Stay In The Family?

When considering where their assets should go upon the death of the surviving spouse, most people with children want the assets to go to them. That makes sense. We want our children to benefit from our efforts. But what if your child gets divorced: will the inheritance be at risk in the divorce? Or what if your child dies much younger than you expect: will the inheritance you left to your child benefit your grandchildren or will it, instead, go to your child’s surviving spouse.

The law tries to protect an inheritance in the event of divorce. Rather than being treated as marital property to be split, an inheritance should be treated as non-marital property of the person who inherited it. But does it always work that way? No. That’s why it is wise to protect the inheritance from the risk of a child’s divorce. You can plan your estate so that your child benefits without losing the inheritance if the child divorces.

Even if the child doesn’t divorce, the inheritance could still end up in the hands of their surviving spouse. This happens when the child dies younger than we expect, and their own estate plan directed all of their assets to their surviving spouse. As we mentioned above, a surviving spouse may find a new spouse or “friend” whose intentions are not pure and who may want to get a piece of the inheritance. To avoid this risk, you can add protections into your estate plan so that your property stays in the family and benefits those in the family who you want to benefit: your surviving spouse, children, and grandchildren.

How Do You Protect Your Assets For Those You Love?

There are estate-planning tools that we can use to protect your assets from the risks mentioned. The most simple and effective one is a trust. Although some people may think of a trust as a one-size-fits-all concept, it is not. A trust is infinitely flexible. We can tailor it to meet your own unique needs and concerns. And through the trust, we can protect your assets for your surviving spouse so that benefits flow to them without losing all the assets to a new spouse or “friend.” And we can use a trust to protect the assets from a child’s potential divorce or their untimely death. That way, the assets stay in the family and benefit your children and grandchildren the way you want. Contact me to explore this and other ways to make sure your property will pass to those you want. We don’t want to see your property lost to others who may not care for your family the way you do.

New Retirement Account Rules: Are You Ready For A Change?

May 31, 2019/in Asset Preservation, Business /by KT Williams

The U.S. House of Representatives just passed a bill to change many rules about retirement accounts, such as Individual Retirement Accounts (IRAs). The bill now heads to the Senate for consideration. Although the Senate may change the bill, the retirement account rules will be changed sooner rather than later. There is simply too much support for change. Evidence of that can be found in the fact that the bill passed the U.S. House of Representatives on a 417 to 3 vote. That is an overwhelming margin. With so much support behind changing the rules, very little can stand in the way. So lets explore the proposed changes. They may not all make it into law, but reviewing them will give us a sense of the changes we may face.

Later Age For Taking Required Minimum Distributions (RMDs)

The law currently requires that a retirement account owner begin taking minimum distributions from their retirement account by the time they reach age 70 ½. Otherwise, severe penalties will be imposed.

Under the proposed law, an account owner can delay minimum distributions until they reach age 72. This will allow those who do not need distributions for their living expenses to keep their retirement accounts intact longer. As a result, it delays the income tax that must be paid when distributions begin. And it means the retirement accounts will not be as depleted at the owner’s death, so larger retirement accounts pass to beneficiaries. This proposed change may be a good one. But there are other proposed changes that offset it.

Mandatory Withdrawal of Inherited Retirement Account Balances: 10-Year Rule

The law currently allows the owner of an inherited retirement account to take distributions from the account in a variety of way. With few exceptions, the owner must take distributions from the account each year. But rather than use the age of the deceased owner to determine the amount of each distribution, the age of the new owner is used to determine the amount of each distribution. Because the new owner is typically younger than the previous owner, the distributions and resulting tax burden are smaller than they would be if using the previous owner’s age.

Under the proposed law, the owner of an inherited retirement account must withdraw the full balance of the retirement account within 10 years of inheriting it. The effect of this change could be huge. For example, it will force the complete distribution of the account over a shorter span than under current law. This means a higher tax burden created more quickly, especially if the distributions from the retirement account push the account owner into a higher tax bracket. Additionally, if the inherited account owner planned to pass the account to their own beneficiaries, the account will not exist if the owner lives at least 10 after inheriting it. And, after the full distribution, the funds remaining will be much smaller because of the higher taxes generated from the accelerated distribution schedule (10-year rule).

What Should You Expect?

You should expect change. With the eye of legislators aimed at retirement accounts, it is simply a matter of time before changes occur, and the changes are likely to be large. Although these proposed changes may not become law, changes are coming.

The best way to protect yourself from surprises and higher taxes is to be proactive. Evaluate your retirement accounts at least quarterly. And stay informed about how the retirement account laws affect you and how they will affect the beneficiaries of the accounts. Lower taxes and better protection for you and your family are just a few of the benefits you get from being actively involved with your Estate Planning/Elder Law Attorney, financial advisor, and accountant. Estate Planning/Elder Law attorneys, like me, along with your financial advisor and accountant are your financial team. We are here to help you each step of the way. Contact us. And let your friends know we are here to help them, too.

SPECIAL NEEDS TRUST BASICS: When Should You Use A Special Needs Trust

May 6, 2019/in Asset Preservation, Estate Planning /by KT Williams

What Is A Special Needs Trust and Why Is It Important?

A Special Needs Trust provides financial and other assistance to someone without causing them to lose government benefits. Government benefits that a Special Needs Trust helps protect includes Medicaid, SSI (social security income), and low-income housing benefits, just to name a few. Also, a Special Needs Trust allows us to protect assets from nursing home costs when someone goes to a nursing home.

Strict guidelines must be met in order to receive many government benefits. These guidelines include limits on the amount of income and assets the individual may have. Unfortunately, government benefits may not be sufficient to cover all of an individual’s needs. So, family members – usually parents, grandparents and siblings – step in to help. But their help could lead to unintended consequences, such as a loss of SSI and Medicaid.

The loss of SSI and Medicaid is devastating. For many people with special needs, SSI is the sole source of income, and Medicaid is their only way to get much-needed healthcare and medications. And someone who receives government benefits has already experienced a challenging journey. Qualifying for benefits is difficult and stressful. No one wants to go through this long, difficult process again. Fortunately, a properly drafted Special Needs Trust avoids the risk of losing the benefits.

How Do You Create A Special Needs Trust?

Usually a parent or grandparent establishes a Special Needs Trust for a family member who has special needs. The trust helps and supports the family member without affecting their government benefits, including SSI and Medicaid.

The trust should be written by an attorney experienced with Special Needs Trusts and the government benefits involved. By carefully drafting the trust, the assets in the trust will not affect the government benefits, and distributions from the trust will provide an extra benefit. Although some people have expressed concern that the benefits available from a Special Needs Trust are limited, they are not. In fact, the benefits can be substantial and improve an individual’s quality of life.

This illustration will help. If someone has a child with special needs, such as autism, ADHD, Down syndrome, or some other challenge, a parent or grandparent can establish a Special Needs Trust. After it is established, anyone can contribute assets, such as money, bank accounts, property, real estate, and cash. The assets in the trust will be used to support the individual with special needs. After the individual dies, the assets remaining in the trust can be distributed to someone else, such as siblings, nieces or nephews, or even a charitable organization whose mission is to support those with a similar special need.

The government benefits will be lost if a Special Needs Trust is not used and the property is given directly to the individual receiving government benefits. We do not want that result. Obviously, giving assets directly to them is a bad idea. Instead, the assets should be placed in a Special Needs Trust. Structured this way, the individual receiving government benefits will not lose those benefits, yet they will receive support from the trust. And at the individual’s death, the assets in the trust will pass to whomever or whatever the person creating the trust thought best, including family members or people with a similar special need.

When Should You Create a Special Needs Trust?

You should create a Special Needs Trust as soon as you discover that you have a special needs family member who you want to help now or sometime in the future. Compared to waiting until years later, creating a Special Needs Trust soon will provide you with more flexibility and a greater opportunity to get the most benefit out of the trust. But, even if you have delayed in creating it, the benefits to having a Special Needs Trust far outweigh any drawbacks. Call us or schedule an appointment to see how a Special Needs Trust might fit in your life.

April 16 – National Health Care Decisions Day! Are you ready?

April 5, 2019/in Asset Preservation, Estate Planning /by KT Williams

National Health Care Decisions Day is April 16th, a day set aside to recognize the importance of advance health care planning for you and your loved ones. None of us should underestimate how much peace we can give those around us by simply making our wishes known. Health care professionals, estate planning attorneys, and caregivers recognize the importance of advance health care planning. For us, advance health care planning is part of our daily lives. We work with individuals and families on their Advance Health Care Directives, such as Living Will, Health Care Power of Attorney or Medical Power of Attorney, or Designation of Health Care Surrogate. Although routine for us, advance health care planning is uncharted territory for others. This article explains how you can be ready for National Health Care Decisions Day, and it answers many questions about advance health care decisions.

What are Advance Health Care Directives?

Advance Health Care Directives (AHCDs) are written instructions we give family, friends, and our doctors. These instructions tell them how we feel about the health care decisions that might come up when we can’t make decisions for ourselves.

AHCDs take many forms, and they go by a variety of names. A Living Will is an example. Another example is a Health Care Power of Attorney or Medical Power of Attorney. Perhaps, you’ve heard of a Designation of Health Care Surrogate. These are all AHCDs.

AHCDs do not take the place of our own decision making. Rather, they express our decisions. If we’re unable to make decisions at any time after completing our directives, our directives are reviewed to see what we want.

What Questions are Covered in Advance Health Care Directives?

AHCDs tell others what kind of health care we want to receive if we become unable to speak for ourselves. They also allow us to identify who we want making decisions for us. Our health care decision maker is called a Health Care Surrogate (HCS). This person will communicate directly with our physicians and nurses about our condition, treatment, and prognosis. Then, they will work together to decide what we would. Our AHCDs are the written guide that they will follow.

There is another important step, and we can’t overstate how important it is. We must tell our Health Care Surrogate and our family how we feel about our health care. The written AHCDs provide important details and directions to them, but we should also talk to them about it. Our conversations will help them better understand how we feel. This will give them the confidence they need to make the correct decisions.

What Do We Need To Consider?

As we look ahead to completing our own AHCDs, we should consider some of the health care decisions that may come up. And we should consider who we want to make them for us. Let us start with our Health Care Surrogate. This is who will make health care decisions for us when we can’t make them for ourselves. This should be someone you trust. And this should be someone who can handle the weight of the decisions they may have to make. Often, spouses or our children are chosen to be our HCS. However, they may not be the best choice. I have seen instances where siblings, friends, or co-workers have been chosen as HCS. After you’ve chosen your HCS, tell them about your choice, then tell them how you feel about the health care decisions they may have to make.

Next, consider if you want life support. And consider if there are some circumstances when you want life support and if there are some circumstances when you don’t want life support. Also, consider if you want feeding tubes and if there are some circumstances when you don’t want feeding tubes.

Perhaps, we don’t like the idea of life support or feeding tubes. But maybe we want those things if they will allow us to recover and lead a quality life. In those instances, whether talking about life support or feeding tubes, it is important to communicate our wishes to our HCS so that the surrogate can correctly carry them out.

Why Do It Now?

AHCDs are easy to complete, and there is no better time than the present to complete them. If we change our mind, changing our AHCDs is simple. Also, completing our AHCDs gives us time to openly tell our HCS, our family, and other loved ones how we feel about the topics covered in AHCDs. Finally, if we visit a physician, have a hospital stay, or get a checkup, it is inevitable that we will be asked if we have a Living Will. Won’t we feel better if we’re able to say “yes” to that question rather than sheepishly saying “no”. Contact us to help you with your Living Wills and other Health Care Directives.

Beneficiary Designations: When was the last time you checked yours?

March 29, 2019/in Asset Preservation, Estate Planning /by KT Williams

Beneficiary designations are an important part of your estate plan. They direct where certain assets or benefits are to be paid at your death. Usually, beneficiary designations allow the asset to pass directly to your beneficiary without delay. This often results in savings of time and money to your beneficiaries.

Life Insurance and Retirement Accounts
The most common assets with beneficiary designations are our retirement accounts and life insurance policies. When we establish our retirement accounts, we are given beneficiary designation forms to complete. On the forms, we identify who we want to receive the assets at our death. In addition to the primary beneficiary, we can name contingent, or successor, beneficiaries. As our lives change, the beneficiary we initially chose may need changing as well. For instance, if we establish the account before we are married, we might name a sibling or a parent as the beneficiary. After we marry, we might prefer that our beneficiary be our spouse. Later, children might enter the picture. If we have children, naming them as contingent beneficiaries might seem like the right thing to do.

However, it is easy to forget our beneficiary designations when we are caught up in everyday life. Months and years may pass without giving any thought to what will happen to those accounts when we pass. Let this be your reminder. And, when you check them, check in with your financial advisor or insurance professional to make sure that you are on track with the goals you’ve set.

Banking and Investment Accounts
In addition to the life insurance and retirement accounts, your banking accounts and investment accounts may also have beneficiary designations assigned to them. This is accomplished through a pay-on-death (POD) designation. For example, when a person who owns a bank or investment account adds a POD designation, the POD beneficiary will receive the account upon the death of the owner. As with other automatic transfers that occur at death, this type of automatic transfer bypasses Probate and the Estate Administration process.

Annual Review of Beneficiary Designations
At least once a year, you should review your beneficiary designations and POD designations. You want to be certain that the beneficiaries you identified remain who you want to receive the asset. As our life changes and our families change, grow and mature, the designation that made sense in the past may not make sense today.

Additional Consideration: Asset Protection
Occasionally, the beneficiary designation should change for reasons other than changes in marriage and children. Perhaps, you want to protect your assets from the cost of nursing home care. Perhaps, you want to protect your assets from falling into the wrong hands, such as the hands of an in-law or a child’s ex-spouse. Perhaps you want your assets to benefit someone without jeopardizing their other benefits, such as SSI, Medicaid, or other government programs. In those instances, a Trust can take care of the beneficiary and protect the assets you are passing to them. Care should be taken to ensure that the beneficiary designation is completed correctly so that it achieves your goal.

Let us help you make sure the beneficiary designations are correct and make the most sense for your family and your goals. If your goals include protecting your assets from nursing home costs of a beneficiary, from in-laws or ex-spouses, and from creditors, special guidance is necessary.