Who Will Advocate and Care for Your Disabled Adult Child When You’re Gone?
Emotional. Personal. Yet a Guardianship Petition to the Court Required.
Your children become adults once they turn 18. Bar nothing. In the eyes of the law, even a developmental disability, mental illness, or the diminished capacity that prohibits them from making critical life decisions can’t change that. Eighteen is the age of majority, and at that point, without an action by a court of law, your legal decision-making authority for your children ends.
That’s a huge worry when you’re the parent of a disabled youngster. How will your child get through life without someone’s guidance? Who will assist with their critical life issues? What will happen when you’re gone? It is an emotionally charged situation to be sure. Personal. Passionate. Still, the only way for you or some other responsible individual to retain or acquire the authority to make decisions for your child is to petition the court to grant legal guardianship.
Guardianship is a legal process and according to the New Jersey Department of Human Services’ Department of Developmental Disabilities, it removes a person’s “fundamental right of self-determination.” That’s why it’s considered a solution of last resort. Even though your youngster may still act like your 10-year-old, in New Jersey, you still must petition the Superior Court—in other words, have your case heard—to be appointed as guardian and have that petition granted.
Each Case is Different
On the one hand, not everyone with a developmental disability needs a guardian when they turn 18. Determining whether your adult son or daughter actually needs one is the first important step. The answer to this question is dependent upon individualized circumstances. If your son or daughter still lives at home with you and has no serious chronic medical issues that involve frequent hospitalizations etc., there may be no immediate need to pursue guardianship. However, it is wise to appoint a guardian even if no emergent circumstances exist, as there is likely to come a time when your child will require an advocate to make sure he or she has proper counsel about financial, medical, or other life decisions. You can petition the court pro se on your own, but the court system can be confusing. It is advisable to get an attorney.
All applications for guardianship require an up-to-date assessment from a psychologist, psychiatrist or medical doctor licensed in the State of New Jersey. The purpose of this assessment is to verify the child’s inability to care for or make decisions on their own. The range of need may vary which is why the court ultimately can impose a varying level of guardianship.
Under a General Guardianship, the guardian makes decisions and gives consents related to all areas of a person’s life. Limited Guardianship applies only to certain areas specified by the court; these could include residential, vocational, legal, medical, and educational. Financial decision-making will also be considered and assessed, if you are seeking guardianship of property, especially when significant amounts of money are owned or passed to the person for whom you are seeking guardianship.
A Case for Co-guardianship
Not too long ago, our firm took on a somewhat unique guardianship petition to appoint not one but four guardians for the client’s adult child who has Down’s Syndrome: the individual’s aging mother, his two sisters, who lived in different states and spent significant periods of time caring for their brother, and one sister’s husband, the adult child’s brother-in-law, with whom the aging mother and adult child lived.
Our case wasn’t contentious, but the court was basically asking why it should appoint all these people as guardians. Co-guardians can be appointed in accordance with the law, and oftentimes the co-guardians are spouses. The courts are hesitant, however, to put too many cooks in the kitchen. In this case, we made an argument that all four individuals played a significant and unique role in the adult child’s life and had unique experience (i.e., medical or financial) that made them invaluable to providing support to the incapacitated child. In a sense, the family also was seeking to implement a succession planning-like component to the guardianship process. Successor guardianship appointments are not automatic, even if they are named in a person’s Will. The request for a successor guardian must still be processed through the court.
Successor Guardian Needs Meet Compelling Life Realities
The mother of this adult child was aging but as his advocate and caregiver for his lifetime to date, she had deep, strong ties with her son. We argued her decision-making, care, and support status should be allowed to continue and that she should remain as guardian until it was no longer possible for her to do so—at least on her own—or until she died.
Adding additional guardians to a guardianship petition always requires returning to court.
There was no disputing the fact that mom was getting older and her own abili-ty to make decisions was diminishing. It stood to reason then, that the sisters should take on advocacy when mom could no longer do it. The young man with Down’s Syndrome was already living with one sister and her husband who had always been an important presence in the young man’s life. What’s more, the brother-in-law had always handled his financial matters. This was a definitely important function relative to the adult child’s continuous medical and housing needs. Finally, the young man would travel to his other sister’s home in another state to spend a significant portion of every summer with her family. Our belief in the rightness of petitioning co-guardianship for these four family members and the need for sound financial support for the disabled adult child formed the basis of our partner, Gretchan Ohlig’s, strong case before the court…and she won.
At Phelan, Frantz, Ohlig & Wegbreit, LLC, we are here to serve you and answer your questions about guardianship. We have represented many families with concerns about the ongoing care of their adult children with autism or other disabilities and chronic conditions. Our work and our lives have put all of us at the firm close to friends, family, and clients who have lived through the care challenges faced by families in this situation, and we address each case with professionalism, knowledge, and empathy.
Call us at 908-232-2244 to better understand the guardianship process. Be assured we will handle your petition with the care deserving of your mission to safeguard the life needs of the adult child you love.
BUYER BEWARE: DO-IT-YOURSELF ESTATE PLANNING IS RISKY
LegalZoom is a do-it-yourself (DIY) online platform that provides a cheaper alternative to legal tasks than heading to a law firm. Lured by saving money and the thought that forms governing any legal process are all the same, many clients turn to these automated legal services and relinquish all contact with an attorney.
Seems easy enough, right? But if you’re a layperson filling out these forms, it’s also equally easy to miss a step. That omission could interfere with the proper legal process that’s required at the time a form is called into play. What’s more, in the end, you may have to pony up more money than you originally saved when you were preparing the document.
When you work with one of our Phelan, Frantz, Ohlig, & Wegbreit attorneys, it’s never just about the service or form you need. We create your plan based upon your unique requirements. Estate planning issues are never cookie cutter. For example, the Power of Attorney for a collegebound youngster serves a far different purpose than the language of a 70-year-old who requires a POA.
In the case of the young adult about to go off to college, the primary concern is that their parents have a HIPAA release. This is the ability to get and share medical information with the health care professionals who are caring for their youngster. Without the proper wording of a POA, protections from the Family Educational Rights and Privacy Act (FERPA) could prevent these important conversations from taking place.
Similarly, a younger client who may have digital assets that run the gamut from social media accounts to financial Bitcoin holdings require specific language put into their POA. That language isn’t going to exist on LegalZoom, but it’s language we’ve crafted because we’ve served clients with situations like this.
Beyond the failure to fully address unique situations, downloaded POA forms often neglect to name a successor to serve as POA. They’ll name one person. And if that appointee is not available to act, the form becomes completely useless. When you retain the services of an estate attorney, you’re not just retaining an attorney to create a document and have you sign it. You’re retaining an estate attorney who has experience in these matters and is able to listen to your needs and story and craft a document most appropriate for you.
Variances State to State
Requirements for documents also differ state-to-state, even in bordering states. In New York, for example, the agent must sign the document. In New Jersey, that is not a requirement. New York requires 2 witnesses; New Jersey only 1. Downloading something from LegalZoom does not necessarily take these variances into account. This issue can become even more complicated if you have more than 1 home in different states.
To make matters even more difficult, laws are not static. They constantly change because of new laws and new statutes. To best advise their clients, lawyers keep up with these changes.
It’s Not Better Late Than Never
It’s not uncommon for clients to seek out an attorney to unravel situations that have arisen when an online document is put to the test…and flunks. One family whose dad was sick was rightly focused on getting their dad the palliative care he needed. Understandably, the entire family was emotionally spent both from worry and from developing a care plan. One of the adult children headed to LegalZoom and downloaded a basic Will. The Will dictated that everything would go to the decedent’s wife. If she died first, everything would go to the couple’s four children. The document also appointed the oldest child as Executor.
As it turned out, the dad lived a lot longer than anybody anticipated. The mom actually ended up dying beforehand which meant that everything was passed on to the four children as the LegalZoom Will dictated. Problem was, there were a couple of important things missing:
- The family didn’t have the important “What if” conversation about what would happen if one of the children predeceased the father. One of them—the oldest one, no less—did. This brought up the further question about who would be the new Executor and whether the remaining siblings wanted any assets to go to the deceased sibling’s children. There was considerable disagreement among the siblings.
- While the Will did appoint the oldest child to be the Executor, it didn’t include a provision to appoint a secondary Executor if the first was not available to serve. It also did not waive the surety bond requirement. In the case of estate administration, the surety bond protects the beneficiaries and creditors of the estate against improper distribution of assets by the Executor. The bond guarantees that the Executor will distribute the estate’s assets according to the Will or a court judgment. In this particular case, the court required the family to get a bond. The new Executor had creditor issues, so the premium for the surety bond ended up being $6000 a year.
Had this family sought legal counsel when they prepared a Will, they would have spent far less money and encountered less, if any, problem resolving the above issues. If they’d come to our firm, we would have had the conversation with them about the possibility of a child predeceasing the father. We would also have included language waiving the bond requirement. We would waive the bond because our clients are typically appointing their children as executors and these are appointees they trust. They’re not concerned that any nefarious action will take place.
If you do decide to use LegalZoom, know the risks you’re taking. Don’t be lulled into a false sense of security. And remember. Your mistakes will not come to light until you become incapacitated or die. The people who are left to deal with these mistakes are your loved ones, the individuals you set out to protect in the first place.
At Phelan, Frantz, Ohlig, & Wegbreit, LLC, you can be assured we will cover all the bases in helping you develop your estate plan. We use the knowledge we’ve acquired in our years of schooling and practice to counsel you on the best ways to protect and take care of your family.
Call us at 908-232-2244 to make sure you craft an estate plan that will fully preserve and distribute your assets in accordance with your wishes and in the manner your loved ones deserve.
Pride Month: A Great Time for Same-Sex Couples to Seal Their Wishes With Estate Planning
Proper estate planning is daunting but necessary for anyone who wants to ensure that their wishes for end-of-life care and the disposition of their assets are carried out. It could be even more critical for LGBTQIA+ families. While laws and attitudes continue to evolve, limitations still exist in some areas. Estate planning is one of them. With June being LGBTQIA+ Pride Month, it’s a perfect time for you to turn your attention to estate planning and prevent the creation of important estate planning documents from slipping through the cracks.
Unless you are married or have an estate plan, your assets and any decision-making regarding end-of- life care will likely revert to your family of origin. Love them or not, that is almost certainly not what you want to happen. If you have no estate plan, every state provides default rules about who might be responsible for your care if you are incapacitated or to determine who would receive your assets when you die.
Marriage Key to Health Care Decision-Making
Many things have changed since the 2015 Obergefell v. Hodges Supreme Court decision that legalized same-sex marriage. Even so, many same-sex couples choose not to marry or to legally formalize their relationships. It also is unlikely these couples have taken the time to create a Will, a Durable Financial Power of Attorney, and an Advanced Health Care Directive or Health Care Proxy. This can have negative consequences, both in decision-making for end-of-life care and asset transfer and inheritance tax issues. These omissions can cause a lot of problems for a surviving partner.
An Advanced Health Care Directive is an important component to every individual’s estate planning. It enables you to appoint an individual of your choosing to make important health care decisions if you are ill or incapacitated and cannot advocate for yourself. If a married couple does not have a Health Care Proxy, your physician will likely defer to your spouse to make decisions about your care. That is not always the case with unmarried same-sex couples. While this is not solely a same-sex issue, it tends to come up more with same-sex partners.
Marriage Influences Survivor Asset Transfer
There’s also a secondary monetary issue. You can title a house deed for joint tenancy with rights of survivorship, and you can name anyone to be your beneficiary on a life insurance policy and in both cases facilitate a seamless transition. But that is not the case with other holdings. Laws vary from state-to-state, and New Jersey, for example, has an inheritance tax. While the inheritance tax does not apply to assets that go to a spouse, it does apply to anyone who’s not your spouse. You could be with someone for 50 years and never be legally married or set up a civil union. This means that everything that your partner would inherit from you will be taxed as much as 16 percent. That can end up being a lot of money.
If you’re not married or have legally formalized your relationship as a civil union, there’s no getting around the inheritance tax. Imagine what happens when your surviving partner takes monies out of your 401(k). Getting taxed on your 401(k) withdrawals is standard. But if you and your partner are not married, an extra 15 percent or 16 percent in tax will be tacked onto the withdrawal. Even having a Will won’t circumvent the issue.
The good news is that same-sex couples who marry can enjoy the unlimited marital deduction for federal estate and gift taxes – a privilege many heterosexual married couples have enjoyed for decades. Gay and lesbian spouses who consummate their relationship through marriage can now generally leave an unlimited amount of assets to their surviving spouse without triggering a federal estate tax, providing both are U.S. citizens. A same-sex spouse can also now rollover assets from a deceased spouse’s retirement accounts to their account without a mandatory minimum distribution or lump-sum distribution. By revisiting their financial and estate plan, married same-sex couples can take take advantage of the marital deduction, rollover assets, and free up considerable liquidity.
Some Other Issues for Same-Sex Couples
Same-sex couples also have unique concerns when it comes to children, especially when only one partner is the biological parent – a common occurrence in same-sex marriages. Typically, when parents die, their assets are passed on to their children. If this is an estate planning goal for same-sex couples, it’s important to reach out to a family law attorney to discuss adoption.
One last item that occasionally arises in families. There’s sometimes a stigma attached to same-sex marriages that can also create problems even when Wills and other estate planning documents have been prepared. At the time of death, people start haggling over who’s in charge or who has rights – the same kind of thing that often happens with second marriages. Because such scenarios may find more fertile ground with same-sex or second marriages, it’s wise to have those important conversations about your end-of-life issues before and while you are preparing and/or reviewing your estate plan. Firmly stating your wishes during the planning stage, not when the family is in crisis mode, is the optimal time to raise your family’s awareness and encourage their understanding.
Get Your Ducks in a Row With Essential Estate Documents
Having a comprehensive plan in place can help you circumvent the complexities of estate planning. Review this list to become familiar with the estate planning documents you need:
- Will – Research has suggested that individuals within the LGBTQIA+ community are less likely than non-LGBTQIA+ couples to have a Will. The importance of having a Will to protect assets cannot be emphasized enough. Work with your estate planning attorney to draft this important document. You may even wish to explore additional options that can prevent your Will from being challenged.
- Advanced Directive for Health Care – Advanced Directive is the general term that refers to the various documents that could include a Living Will, Instruction Directive, Health Care Proxy or Health Care Power of Attorney. Whether you are in a domestic partnership and unmarried or married, the Advanced Directive for Health Care is essential to allow your physician and other medical professionals to communicate with your partner about your medical condition, designate your partner or spouse as being able to make medical decisions on your behalf, and alert medical professionals and your family as to the treatments you want to receive or refuse.
- Durable (Financial) Power of Attorney – This document allows someone (typically your spouse or your partner) to make financial decisions on your behalf should you be unable to do so.
- Trust – You may wish to speak with your estate attorney about creating a trust which may provide your assets with even greater protection than a Will.
At Phelan, Frantz, Ohlig & Wegbreit, LLC, we are always prepared to provide you with the estate planning guidance that is most appropriate for your specific situation. We are confident in our knowledge and ability to successfully navigate through any of the complexities involved.
Call us at (908) 232-2244 and be proactive in creating an estate plan that has your family’s best interests at heart.
2 IMPORTANT DOCUMENTS PARENTS AND COLLEGE-BOUND KIDS NEED TO DISCUSS
Pragmatism versus privacy
It may seem like just yesterday that your son or daughter was breaking the bonds of home to go to preschool. Now, the kid on whom you’ve devoted so much time and care over the years, whom you’ve laughed and cried with through joys and sorrows, is heading off to college or even a gap year abroad.
Your kids are 18 now, or almost so. Chronologically, they are adults, and entitled to all the rights that come with adulthood. Privacy is among those rights. Believe it or not, even if you’re paying college tuition for your kids, claim them as dependents on your tax returns and insure them on your health insurance plans, you cannot intercede on issues concerning their health or finances without their permission.
healthcare proxy and durable power of attorney
You don’t have to be a helicopter parent to have them sign two important documents, a healthcare proxy (also called a healthcare power of attorney) and a durable power of attorney. By signing these documents, your children are giving you permission to act on their behalf when situations necessitate this. These documents allow you to be your kids’ important and immediate fallback in a health or financial emergency. Otherwise, you may face delays in gaining information or, in a worst-case scenario, be required to petition the court for conservatorship or guardianship.
Thanks to the Coronavirus (COVID-19) pandemic you may be looking at an early summer send- off for your college bound youngster, and we’re only now getting out of lockdown. Still, scheduling a trip to your attorney’s office is a priority. Having your young adult understand the importance of these documents and sign them is a must-have addition to your summer parental to-do list.
Not about spying
Your youngsters may be feeling empowered by their new independent status. You certainly respect that independence and want them to use that privilege wisely. The issue is not about your need to keep an eye on them. There’s an important distinction to be made between their desire to keep the events of their lives close to the vest and the necessity of them—like all adults—having responsible people to assist or take over in critical situations.
Your child’s medical records, for example, are like the medical records of all adults: protected by the Health Insurance Portability and Accountability Act (HIPAA), HIPPA states that health records are private between the adult patient and their health care provider. Without authorization, parents are not entitled to access their adult children’s records. In fact, under HIPAA, medical facilities (including college infirmaries) can withhold information about whether your child is admitted.
Sadly, situations requiring intercession in decision-making could be life threatening. All too often we hear of bad accidents or hospitalization from alcohol poisoning. Or, your youngster could have a ruptured appendix and be too sick to discuss a need for surgery. There could also be nonlethal issues. Your kids may have to head to the college infirmary, and the medical staff must contact you for history on your child’s allergies to certain medications.
Even financially, while studying abroad, your youngsters may be unavailable to perform time-controlled financial activities. You could be called upon to sign a summer apartment lease on their behalf or talk to one of their creditors. In fact, you’ll be able to conduct all financial business for your child when he or she signs this document—anything from writing checks, buying/selling or renting real estate, contacting creditors and making investments to contacting his or her insurance company, renewing his or her vehicle registration, or putting money in his or her bank account—even wiring funds to the American embassy where he or she is living.
Both the healthcare proxy and the durable power of attorney may kick in from the moment your child signs it, which is the preferable handling. Alternately, your adult child can specify that it be activated by a specific event, for instance, if he or she becomes incapacitated. The latter, called a springing power, however, requires that someone (typically a medical professional) must decide when an individual is actually unable to advocate for him- or herself. In life-threatening moments, determining incompetence can take added precious time when you can’t spare it.
Their willingness is all
As you might expect, you can take your rising freshman to your lawyer’s office, but at the end of day, he or she must be willing to sign the documents. At 18, your youngster may still think you are clueless—even more, that now on the brink of true adulthood, they don’t want Mom and Dad to know their business.
The mentality of “what happens at college, stays at college” is understandable and learning to manage crisis independently is an important part of the college or young-adult experience. More importantly, your children have the right to maintain their privacy. But the reality is that health issues arise, and financial matters often must be handled quickly. Having a healthcare proxy and/or a durable power of attorney in place are critical safeguards that benefit your adult children—just as they benefit any adult who grants another trusted person the power to act on his or her behalf when situations necessitate this. As in any case, communication with your child about when and how the documents would be used by you is critical.
Alternate appointees for strained relationships
As a parent, you are the best person to be in charge of your child’s medical and legal matters. But sometimes parent-child relationships are strained. In these situations, you or your attorney can encourage your child to appoint another trusted adult like an aunt, uncle or older sibling. In these cases, it’s also a good idea to name an alternate. Your child’s first choice may be unable or unwilling to serve in this role at a given time.
The primary message to convey to kids is that it’s imperative to have a responsible person at the ready to act in their stead if and when time-sensitive health or financial issues arise.
At Phelan, Frantz, Ohlig and Wegbreit, LLC, we understand this is a delicate conversation for you to have with your children and know we can be of assistance. In these situations, because your children become our clients, we’ll discuss these issues with them privately. At a time when these young people are on the brink of being the most independent they’ve been in their lives thus far, we will counsel them. And as we do with all our clients, we will guide them to act in their best interests.
Call us at 908.232.2244 to schedule an appointment for your young adult and put these important documents in place.
8 STEPS TO CREATING YOUR ESTATE PLAN IN THE NEW YEAR
Procrastination is often the biggest enemy of estate planning!
We’ve all heard stories like this: A couple is about to head out on a prolonged business/pleasure trip involving considerable air travel. Panic sets in five days before their departure when it dawns on them that they don’t have Wills. Though immediate outreach to their attorney may enable them to get documents drafted and executed before they leave, this scenario is hardly ideal. Harried or rushed actions can result in improper or faulty planning, which in turn may lead to family misunderstandings and disputes, assets going into the wrong hands, court cases, and the corresponding expense in legal fees and/or taxes.
As the saying goes, there’s no time like the present, even when planning for events likely to occur in the distant future. The New Year is the perfect time to get started or review a plan you already have to make sure it is on track.
Wherever you are in your estate planning process, our eight-point New Year’s checklist will help you get off on the right foot.
1. Make an appointment with an experienced estate planning attorney
There’s no better way to get the wheels turning than to sit down with an attorney experienced in estate planning. In this initial visit, your attorney will familiarize you with all the issues you must consider.
Estate planning is serious business and far more than a last-minute scramble to execute a Will. Its goal is to ensure the seamless transfer of assets to your heirs. It also safeguards your assets and the care you receive during times of critical illness if and when you cannot advocate for yourself. Estate planning takes considerable thought, important family conversations and the painstaking development of a plan geared to your unique family situation.
2. Take inventory
Assimilating information on your assets, tangible and intangible, is critical. This means listing what they are and how they are held. Some of these assets will pass to your survivors under your Will, others will pass to beneficiaries outside of your Will.
Tangible Assets include Real Property, land and whatever is built on it, typically your house, and Personal Property, which includes your physical possessions: jewelry, art and antiques and other collectibles; television sets, computers and other electronics. These will be just some of the items on the list.
Intangible assets include the things you own on paper: bank accounts, stocks, bonds, insurance policies, and retirement accounts (IRA’s). Items like bank accounts and stocks and bonds in a brokerage account likely will pass through your Will or to a joint account holder. Items like your insurance policy, IRA or 401(k) already have named beneficiaries and will pass to your survivors outside of your Will regardless of what your Will dictates. Reviewing these distinctions is a KEY piece of crafting an appropriate estate plan.
3. Get organized
Getting organized is another vital step. It requires that you create a spreadsheet that itemizes all of the above items, again both tangible and intangible. Make copies of deeds and mortgage documents related to real estate, make copies and place originals and copies in a safe place. Ideally, your estate attorney will retain the original and a trusted designee named in a legal document will securely retain the other.
All documents should be recorded on a spreadsheet which accurately identifies the institution or institutions in which an asset is held and account numbers and passwords to the accounts, and contact information for the representative in the institution who handles your account. It is imperative that your estate attorney and the designated fiduciaries have copies of these spreadsheets or knows where to find them.
If you have a safety deposit box that holds important documents or information, make certain your attorney and survivors know the box number and in which bank the box is located. It is advisable to provide your attorney and your designees an extra key.
Note: Once you and your attorney have actually developed a plan, you will have created a Will, Durable Power of Attorney, Living Will and Advanced (Healthcare) Directive, essential documents which may be held in your safety deposit box and/or with your attorney as well as with other fiduciaries and designees.
4. Designate Fiduciaries (Financial), Healthcare Proxy and Create the Necessary Documents
Fiduciary roles refer to any person or institution that has the power to act on your behalf in situations in which you are no longer capable of acting or advocating for yourself and following your death. Plus, any adult can serve as your Healthcare Proxy. Fiduciaries can assume many roles in your estate, and, depending on a particular fiduciary designation, can act either before or after your death…or in both situations.
The law stipulates that your fiduciaries be legally competent individuals over 18 years of age and capable of managing their own affairs. But that’s where the requirements stop and where your careful thought and good judgement come in. Because these positions require the utmost honesty, loyalty and trustworthiness, the individuals you choose must be able to set aside their own personal inclinations and motivations to act in a manner consistent with your financial and health goals. Plus, if you have children who are minors, it is wise to appoint a guardian who will parent in a manner consistent with your parenting style and love your children as you would.
Each role requires a different skill set. To choose the most appropriate fiduciary, align the strengths and characteristics of the person you want to designate with the functions required for that position. It is also advisable to have an alternate or backup in case logistically there is a problem with the primary person being available when it’s time to serve.
Keep in mind also that you must reach out to the individuals whom you want to serve in these roles and ask/confirm that they are willing to assume the associated responsibilities. While being selected may be considered an honor, these positions take time, require work and, in many cases, require a stalwart mindset.
5. Draft your Will
A Will is one of the main, if not the primary, components of every estate plan, even if you don’t have substantial assets. Wills ensure property is distributed according to your wishes and drafted according to state laws. In it, you state who you want to inherit your property, name the person (the Executor) who is in charge of distributing your assets as instructed in the Will, and address the contingency of the simultaneous death of you and your spouse, name a guardian to care for your young children.
Simply having a Will isn’t enough, though. The proper wording of the document is critically important, which is why it is highly recommended that you work with an estate attorney when executing this document. Sometimes, when individuals try to do this themselves with one of the Do It Yourself apps, they overlook important considerations or fail to comply with laws in their state. This can cause probate problems that may require your heirs to spend time and money attempting to rectify misstatements, omissions and other mistakes
6. Consider a Trust
A trust is legal entity that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when your assets pass to your heirs.
Trusts typically avoid probate, so your beneficiaries may gain access to these assets more quickly than they might to assets that are transferred through a Will. And, because assets that you’ve held in a trust may be able to pass outside of probate, this saves your heirs time, court fees, and potentially reduces estate taxes as well. An irrevocable trust, for example, may not be considered part of your taxable estate, so fewer taxes may be due upon your death.
You can specify the terms of a Trust down to the letter, controlling when and to whom distributions may be made. What’s more, if you set up a revocable trust, the Trust assets remain accessible to you during your lifetime; you designate to whom the remaining assets will pass, even when there are complex situations such as children from more than one marriage.
A properly constructed Trust can also help protect your estate from your heirs’ creditors, future ex-spouses, or from beneficiaries who may not be adept at managing money. Again, working with an experienced estate attorney will ensure you set up a Trust with the best governance for your unique situation.
7. Make a Living Will
A Living Will, also called an Advanced Directive, is a written statement that details the type of care you want or don’t want if you become incapacitated. A Living Will bears no relation to your conventional Will or Living Trust used to bequest property upon your death. It’s strictly a document that spells out your health care preferences and addresses a number of possible end- of-life care decisions and whether you want or do not want them. While you may indicate you do not want heroic measures, you must define heroic and answer questions regarding whether you want:
- Mechanical Ventilation – A respirator can take over your breathing if you are unable to breathe on your own.
- CPR – Cardiopulmonary resuscitation can restart the heart.
- Nutrition and Hydration – Tube feeding can supply the body with nutrients and fluids.
- Palliative Care – Narcotics and other interventions can keep you comfortable; this issue also addresses your wish to avoid invasive tests or treatments.
- Antibiotics or Antiviral Medications – These can be used to treat many infections. If you were near the end of life, would you want infections to be treated aggressively or have them run their course.
Creating your Living Will requires you to think about your values as well as your wishes: Questions like how important it is to you to be independent and self-sufficient? What circumstances might make you feel like your life is not worth living? Would you want treatment to extend your life in any or all situations, or only if a cure seems possible?
Also, beyond treatments during illness, you can specify your wishes to donate your organs and tissues or donating your body to scientific study.
8. Draft a Power of Attorney
A Power of Attorney (POA) is a very important estate planning tool which allows a person you appoint—your Attorney-in-Fact or Agent—to act in your stead in financial and legal matters.
A POA grants broad authority to your agent to sign documents, pay bills, and conduct financial transactions on your behalf. In other words, your agent will be authorized to handle “the business” of your life.
The Bottom Line
As is evident from the above considerations, there is more to estate planning than deciding how to divvy up your assets and provide for your loved ones and other beneficiaries when you die. Estate planning also ensures that the right individuals have access to your assets upon your temporary or permanent incapacity so that your affairs can be handled appropriately and the care you receive will ensure the dignity and quality of life you deserve and desire.
While estate planning may seem like a bleak and uncomfortable task for the start of a new year, it is a necessary one to address. You can adjust your mindset to think of your estate planning in a positive light. Just consider: Thorough preparation now will give your family peace and comfort and a stress-free probate process at some future time when your family will be dealing with emotions of loss and sadness.
When you think of estate planning in this way, you will likely come to realize that planning today is a gift you are giving your loved ones for some time in the future. And giving a meaningful gift to your loved ones…there’s no better way to start a new year!
At Phelan, Frantz, Ohlig & Wegbreit, LLC, we take our responsibility to provide families with conscientious estate planning very seriously…in the new year and beyond. Please enjoy the year ahead and contact us if we can be of assistance to you in developing and/or reviewing the appropriate estate plan for your family.