Estate Planning is an important step in securing your financial future for yourself and your loved ones. Your plan should be tailored to your specific needs, goals and family circumstances.
There is no one size fits all estate planning model, nor should you rely on DIY or online forms to build your estate plan. These seemingly quick and inexpensive alternatives to sound legal guidance from an experienced elder care law attorney carry tremendous risk and the potential for more expense and frustration in the end.
Estate Planning is essential to complete in advance in order to provide for your family, designate a person to make medical and financial decisions on your behalf, and ultimately protect your assets. Should an estate plan not be in place, then the courts will decide who inherits and who can help should you become incapacitated.
Here are 8 reasons you should avoid cookie-cutter plans.
Meet Your Specific Goals Now and Into the Future
The basic goals of estate planning involve inheritance and help. But the specifics of a solid estate plan should also answer the who, what, when and how.
When setting up an estate plan, your legal documents can be drafted to adapt and anticipate your goals throughout your lifetime. However, estate plans can become outdated; tax policy changes can occur and the dynamics of your family can change. Working with an experienced elder care law attorney can help you build a plan that evolves to meet your needs and will continue to provide stability and security well into the future.
Weddings, Funerals and Everything In Between
It would seem obvious that estate plans need to be updated to reflect new additions and losses within a family, but a comprehensive estate plan can also protect your accumulated wealth from the risks of divorce, addiction, creditor problems and misuse. In addition, an experienced elder care law attorney can employ the right legal tools to ensure a disabled family member will be provided for with a protective Supplemental Needs Trust.
Determining Guardianships for Minor Children
Most parents of young children would prefer to push aside the thought of having someone else raise their kids, yet while the thought is difficult to accept, not choosing a guardian for minor children can mean the difference between security and chaos for grieving children. An estate plan prepared by an elder care law attorney can build in provisions for when and how the distribution of assets and inheritance will occur and you can also include wishes relating to the children's upbringing.
Who Will Be There To Help?
Within an estate plan, you should also have your Advance Directives prepared which are legal documents that outline your wishes for your financial and health care decisions should you become incapacitated or pass away. These documents include;
- Durable Power of Attorney: A legal document allowing you to appoint a trusted agent to act on your behalf to make decisions about your property, finances and legal issues.
- Health Care Proxy: Allows you to appoint someone you trust to make healthcare decisions and carry out your wishes in the event you lose the ability to make those decisions yourself.
- Living Will: A written statement that shares your health care wisher in regard to end-of-life care, and instructions about treatment you may or may not want.
Planning To Leave an Inheritance
Even if you are not planning to pass along your grandmother's silver spoons, your estate plan should include a Will. Historically, your Last Will and Testament was the go-to legal document to distribute estate assets after one passes away, but this document, while still necessary to have, has become less important as it requires a Probate court proceeding to be valid and effective. Every good estate plan should try to avoid Probate, which can be done through various legal strategies, to help the family save time, money, and maintain their privacy.
The Reality of Paying for Long Term Care
Every estate plan must also address the reality of needing long term care. The U.S. Department of Health and Human Services reports that there is a 70% chance of needing long term care if you’re over 65 years of age. Yet the options for paying for the care are limited to either personal savings, long term care insurance or Medicaid.
In order for families to avoid financial collapse when needing care, there are legal strategies that can be built into your estate plan to protect your income and assets. The most important strategy is called the Irrevocable Asset Protection Trust. The purpose of this trust is to retain income for you while protecting the assets for your spouse, children or other beneficiaries should Medicaid be required to pay for long-term health care in the future.
Protecting Assets: Big and Small, Near and Far
The idea that estate planning and protecting assets is just for the super-rich or the old is a myth. While it is very important for the wealthy and those over 65, everyone in between should not be caught without an estate plan in place. Ownership of property such as a home, vehicle or bank accounts are subject to probate if one dies without a Will. Additionally, if you own property in a different state you need a probate-avoidance estate plan that covers this to avoid probate in two different states.
Reducing the Burden of Estate Taxes
For families that have accumulated significant wealth, there are planning strategies that can minimize and perhaps eliminate estate taxes altogether. In New York, both federal and state estate taxes exist and if certain strategies are not implemented in your lifetime estate plan, you run the risk of paying upwards of 50% in combined estate taxes. The significant loss of one's estate to the payment of state and federal estate taxes is a great motivator for many people to put an estate plan together.
Your Next Steps
Don't worry if you already have an estate plan in place and these advanced planning issues were not discussed. It's not too late to seek out an experienced elder care law attorney to review your existing plan and address the above issues with you. And if you don’t yet have an estate plan in place, the next step is to consult with an experienced elder care law attorney that can address both the estate planning and the elder care law concerns.
At Tully Law Group, PC, we understand that estate and elder planning can be both emotional and overwhelming. Our attorneys are available to advise you on complex estate planning and elder law issues to minimize the possibility of any problems. We will take the time to review your goals and circumstances and do our best to ensure that your assets are protected and your wishes will be carried out as per your estate plan. For more information regarding our services or to schedule a consultation, call (631) 424-2800.