Many clients do their planning at year end, which is not necessarily the best timing. Planning should carry through the entire year. Now that tax day has passed, it’s as good a time as any to review and update your estate plan. Like your annual physical, it is wise to also have a legal checkup. The following are a few areas that should be considered, although they may not all be appropriate for everybody:
Update Your Estate Plan
Are your Health Care Proxy, Power of Attorney and Will up to date? Are the individuals named within the documents still appropriate to serve as well as receive your assets? Are they healthy? Are their marriages also healthy? If not, perhaps your documents need to be reviewed to provide for preservation of assets for the beneficiaries so they don’t become their liabilities.
Plan For Retirement
Is it time for you to consider when you should collect Social Security? Have economic changes made it necessary for you to work longer but possibly still take Social Security benefits sooner? Is your health insurance in order, or do you need to purchase some other plan, such as a Medigap policy, to ensure you have the coverage you need until you’re able to obtain Medicare benefits? Naturally, if you are in your 20s through 40s, these issues seem way too remote to consider, but other issues should be considered such as saving for retirement and to attending to a child’s education expenses. In fact, if you are relatively young, perhaps you are worried about paying off your own college expenses.
Consider Long-Term Care Insurance
Most seniors are concerned about having their assets spent on long-term care expenses in the event they need institutionalized care or require 24/7 home care. A long-term care policy can help if you’re qualified to obtain the coverage and can afford it. If you can’t afford it, an elder law attorney can present alternatives, like using a reverse mortgage or having children share the cost, etc. It is an option that should not be overlooked, but it must be reviewed to determine whether it is an option for the client or not.
As with all life plans, just because documents are signed, does not mean the plan is good forever. It should be reviewed and revised as laws, finances, and family dynamics change.
by: Hyman G. Darling, Esq.
The recent sophistication of software has contributed to an increase in homegrown estate planning. These mass-marketers of legal services misinform people into thinking that they are saving money and that they are receiving sound legal advice. This is simply not true.
You may have already drafted a Last Will and created an estate plan that transfers your worldly possessions. Your estate plan should not end there. What steps have you taken to ensure that you also pass on your values, ideas and beliefs? What wisdom and life lessons do you want to share with those you care about? Do you want to be remembered for your values rather than for the possessions you have left behind? If so, you may want to consider drafting an ethical will. As the name suggests, ethical wills are the spiritual counterparts to “traditional” Wills that distribute wealth. Ethical wills pass on intangible assets such as blessings, life lessons, dreams and hopes as opposed to tangible possessions. While ethical wills are not binding legal documents, they can be an invaluable gift to friends, family members and loved ones.
When a person close to you dies, there are several issues that need to be attended to. Sometimes there might not be any tax or probate requirements, but nevertheless, it is important to review the situation to ensure that all matters are being handled properly. The following is a relatively short checklist that is not inclusive of all matters to take care of, but certainly, should be on the top of your list:
Women experience unique economic realities. They tend to live longer and move in and out of the workforce due to career interruptions for child birth and elder parent care. This means that women often qualify for much lower pension benefits and receive lower Social Security benefits due to their years employed and salaries attained, which cannot be increased by the husband’s pension or social security if he experiences an untimely death.
A few years ago I presented an Estate Planning Program to employees of the Wall Street Journal. Most of these people were rapidly approaching retirement, and by now, they probably are retired.