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Articles Posted in Estate Planning

Having a pet brings many people joy and provides them with a living creature to take care of and to provide companionship. Unfortunately, pets are often overlooked in people’s plans for incapacity or death.

The types of animals that one has as well of the needs of those animals should be considered carefully when preparing a last will and testament or trust. The responsibility of caring for a small indoor pet is very different from that of a large barnyard animal.

When considering a potential caregiver for your animals, you’ll want to make sure this person has the desire, ability, and available space to take good care of your pets. Also consider the other people who live in their home, taking into account their like or dislike of animals and if anyone in the house may be allergic to the types of pets you have. Also, does this person already have other animals? Someone who already has pets may have a better idea of the time and money needed to take care of your animals, but it may be more difficult for everyone to adjust in this case.

The start of a new year is a great time to revisit your estate plan, reflecting on things that may have changed since you last looked at these documents. As we begin the second month of 2022, here are some questions to consider for your estate plan:

Do you have a will, healthcare directive, and power of attorney in place?

If not, when could you set aside time for each of these?

Have you moved from one state or another, or are you currently planning to move to a new state? People change states for a variety of reasons such as a new job, a more pleasant climate, or to live closer to other family members. There are always some hassles you’ll have to deal with when you move to a new state, including finding new medical providers and updating your driver’s license and other documents.

As part of the planning for this type of move, don’t forget to amend your will and other documents that are part of your estate plan. Although it may not be the most urgent matter to address first, be sure not to put it off as the last thing you do (and especially make sure to not delay it indefinitely).

Don’t forget that the laws governing wills and most estate planning documents vary from state to state. Your will remains generally valid, but it’s important to revisit it and see what laws are different in your new state as well as what may have changed for you personally with your new situation. In extreme cases, it is possible for some estate planning documents to be called into question.

We often think of financial planning as a set of distinct practices – including those such as estate planning, investment planning, retirement planning, etc.

But what events typically lead you to reach out to a financial advisor (or, if you are an advisor, when do your clients reach out to you)? A job or career change, marriage, the birth of a child, death, divorce, disability, or other huge life changes. Not many people seek out an advisor because they simply woke up one morning and realized that their asset allocation could be better.

It’s almost always life that leads to any interest in financial planning. Maybe a better way to think of the purpose of financial planning is this:

Although there are a number of valid form wills online or at local office supply stores, a lot of problems can come from creating a will this way without the advice and expertise of an attorney.

With a will that you download, you get a form and perhaps some instructions and choices for things you can fill in or cross out. However, this type of will doesn’t advise you on things such as how to prepare for if someone predeceases you or how best to leave property to someone who is a minor. It also cannot help you with your choice for a personal representative or a guardian for a child.

Although a will can be simple enough to create without the help of an attorney, bad or unanticipated things can come from making a will by yourself. It’s also incredibly important that the document be executed correctly or it likely won’t be considered valid.

Different people grieve in different ways, and sometimes people handle the death of someone they love in ways that are confusing or frustrating, such as fighting over small things like who gets a furniture set.

I’ll write today about no-contest clauses. A no-contest clause is a provision in your will or trust or estate plan imposing a penalty if someone were to challenge it. Common challenges to an estate plan include claims such as lack of capacity, not understanding the estate plan they signed, being influenced by another beneficiary to give them more, or not having the documents witnessed appropriately or notarized.

As an example, say I had one son and one daughter and wanted to leave one of them more of my estate. If I wanted to leave my son 60% and leave my daughter 40% of my estate, I could institute a clause stating that if my daughter challenges the fact that it’s an unequal division, she would get nothing. With this clause as part of the estate plan, she might be encouraged to simply accept her 40% instead of filing a lawsuit to say that the document wasn’t valid or that I was influenced by my son. However, if I were planning to leave nothing for my daughter at all, a no-contest clause isn’t going to help as there is no part of the estate she will potentially lose if she files a lawsuit.

Elder law and estate planning serve two different but important purposes. While elder law focuses on preserving your wealth and promoting your well-being during your lifetime, estate planning concentrates on what happens after you have passed away.

Elder law planning helps to ensure that seniors can live as long, healthy, and financially secure lives as possible. It involves planning for future medical needs and long-term care. Elder law attorneys can assist you with creating a plan to pay for future care while maintaining your assets or to qualify for Medicaid or other benefits to pay for long-term care. Elder law planning also serves to protect you from elder abuse or exploitation when you get older or become incapacitated. In addition, elder law covers assistance with guardianship and conservatorship.

Unlike elder law which focuses on older individuals, estate planning is for people of every age. Estate planning attorneys help you plan for what will happen to your assets after you die. They use documents such as wills and trusts to ensure your wishes are carried out properly. Estate planning also includes naming a guardian for your children or making plans for the caretaking of your pets. Estate planners can also help you avoid probate and save on estate taxes.

Last week I wrote about health care components of an estate plan that can bring some peace of mind during the current pandemic. Today I will cover important financial components of your estate plan.

Financial Components of an Estate Plan Financial Power of Attorney

With a financial power of attorney, you can choose someone to help with your finances in the event that you become incapacitated and are unable to manage your finances yourself. You can decide how much control you want your power of attorney to have. You may give them power to do things such as access your accounts, sell stock, and manage real estate if you so choose. Make sure to pick someone you trust fully, like your spouse, adult child, or a close friend or family member.

The coronavirus has taken a toll on all of us in a number of ways, including our physical and mental health. Most of us know at least one person who has been affected by the coronavirus. Planning well for health care and financial needs in your estate plan can bring some needed peace of mind during this time. I’ll write today about important health care components of an estate plan and will write next week about financial components.

Health Care Components of an Estate Plan

Advance Health Care Directive

The unveiling of one’s last will and testament almost never happens like it does in the movies, where an attorney reads the document out loud and those in attendance are shocked. Although a formal reading is rare, those who are named (or not named) in someone’s last will and testament might still be surprised when the probate or trust administration commences. Surprises in a will typically lead to conflict between family members and more challenges for whoever is handling the estate.

The best thing you can do to prevent future conflict is to be transparent about your estate planning each step of the way. If possible, include trusted family members in the planning process. In spite of the natural bias they may have, they will hopefully put their own interests aside for the sake of what is best for you and in order to avoid potential problems.

Your loved ones may also be able to offer you insights that you wouldn’t have otherwise. They may be able to advise you on how best to meet ongoing support needs of beneficiaries. They may also know more about tensions within the family that you are not aware of but that you will want to address within your estate plan.