Estate planning is the process of developing a strategy for the care and management of your estate if you become incapacitated or upon your death. One commonly known purpose of estate planning is to minimize taxes and costs, including taxes imposed on gifts, estates, generation skipping transfer and probate court costs. However, your plan must also name someone who will make medical and financial decisions for you if you cannot make decisions for yourself.  You also need to consider how to leave your property and assets while considering your family’s circumstances and needs.

Since your family’s needs and circumstances are constantly changing, so too must your estate plan. Your plan must be updated when certain life changes occur. These include, but are not limited to: marriage, the birth or adoption of a new family member, divorce, the death of a loved one, a significant change in assets, and a move to a new country.

Marriage: it is not uncommon for estate planning to be the last item on the list when a couple is about to be married – whether for the first time or not. On the contrary, marriage is an essential time to update an estate plan. You’ve probably already thought about updating emergency contacts and adding your spouse to existing health and insurance policies. But there’s another important reason to update an estate plan upon marriage. In the event of death, your money and assets may not automatically go to your spouse, especially if you have children of a prior marriage, a prenuptial agreement, or if your assets are jointly owned with someone else (like a sibling, parent, or another family member). A comprehensive estate review will ensure you and your new spouse can rest easy.

Birth or adoption of children or grandchildren: when a new baby arrives, it seems like everything changes – and so should your estate plan. For example, your trust may not “automatically” include your new child, depending on how it is written. So, it’s always a good idea to check and add the new child as a beneficiary. As your children (or grandchildren) grow in age, your estate plan should adjust to ensure assets are distributed in a way you deem proper. What seems like a good idea when your son or granddaughter is a four-year-old may no longer look like such a good idea once their personality has developed and you know them as a 25-year-old college graduate, for example.

Divorce: after a divorce, you should immediately update beneficiary designations for all insurance policies and retirement accounts, any powers of attorney, and any existing health care proxy and HIPAA authorizations. It is also a good time to revamp your will and trust to make sure it does what you want (especially if you want to leave out your former spouse).

The death of a loved one: sometimes those who are named in your estate plan pass away. If an appointed guardian of your children dies, it is imperative to designate a new person. Likewise, if your chosen executor, health care agent or designated power of attorney dies, new ones should be named right away.

Significant change in assets: whether it is a sudden salary increase, inheritance, or the purchase of a large asset these scenarios should prompt an adjustment to an existing estate plan. The bigger the estate, the more likely there will be issues over the disposition of the assets after you are gone. For this reason, it is best to see what changes, if any, are needed after a significant increase (or decrease) in your assets.

A move to a new country: estate planning for Americans living abroad or those who have assets located in numerous countries can get complicated and requires professional assistance. It is always a good idea to learn what you need to do to completely protect yourself and your family before you move to a new country.

Dedicated to empowering your family, securing your wealth and delivering your legacy,

Spring has officially sprung and that means it’s spring cleaning time. Shake out the rugs, clean out the cupboards, and get your legal and financial affairs in order.

For plenty of folks, it’s easy to know what to do when it comes to home organization, but the idea of legal and financial ordering can be complex and confusing.

Here are a few places you can start:

1. Review Your Beneficiary Designations

Request updated beneficiary designation forms from your life insurance account and retirement account custodians. Look at the form and identify whether you have a minor designated as either a primary or contingent beneficiary. If you do, those assets will be tied up in Court, unnecessarily, and may not be available to the people you’ve named to care for your children.

Consider designating your life insurance and retirement accounts to be distributed to a trust for the benefit of your heirs, providing Court and creditor protection, and ensuring your children do not inherit money before they are properly prepared.

2. Update Your Family Wealth Inventory

Your Family Wealth Inventory is a document – usually a spreadsheet – itemizing the assets you own, so that in the event you become incapacitated, or when you die, your family will know how to find everything you own.

Without an updated Family Wealth Inventory, your assets could be lost to California’s department of unclaimed property. There’s currently over 8 billion – with a ‘B” – dollars of assets in California’ department of unclaimed property because most people do not leave a clear record of their assets at the time of their incapacity or death. Don’t let that happen to your assets!

3. Consider If You Need to Name New Guardians (Long or Short-Term)

Review your guardian nomination designations. Have you named guardians for both the short-term (local) and the long-term (people you would trust to raise your kids fully)? If so, do they need to change? Is there anyone you would wish to exclude? Does the ID card for your wallet need to be updated? This is the time to check.

4. Check Out the Title to Your House

Get a copy of the deed to your house and make sure that your trust is listed as the owner on the deed if you want your house to stay out of court in the event of your incapacity or death. If you see your personal name on the deed, and there is not a trust listed, you can bet your house would have to go through the court process of probate in the event of your death before it could be passed to your heirs. If you don’t want that, now is the perfect time to spruce up your planning.

5. Come In and Meet With Us For a Family Legacy Planning Session

Last, but far from least, this is the perfect time of year to come in and meet with us for a Family Legacy Planning Session, whether you’ve done estate planning in the past or not.  We will have a 2-hour working meeting that will get you more financially organized than you’ve likely ever been before (unless you’ve already done planning with us) and give you the confidence of knowing you’ve made the most empowered, informed and educated legal and financial decisions for the people you love. Call within the next week and mention this article to receive your session on a complimentary basis. 

Dedicated to empowering your family, building your wealth and securing your legacy,

Many estate plans are created and then quickly forgotten. While it’s important to update your plan periodically, after any of these seven life events, it becomes critical that you revise your plan as soon as possible.

1.      Marriage. Getting married is the joining of two lives together and your plan must address and account for your new legal status. Naming your spouse as a beneficiary on your insurance policies, updating your will, and including him or her in the planning of your estate are all important steps to take after marriage.

2.      Divorce. Divorce involves a lot of paperwork, and revising and updating your estate plan adds to that. But divorce reflects a change in your legal relationship, so you may want to reconsider what role, if any, your ex-spouse will have in your life and in your estate.

3.      Births and adoptions. Providing for the care and custody of your child in the event of your death or incapacity should be paramount in your estate plan. That means naming guardians for your new child, both long and short-term, is a must. You should also consider setting up a trust and naming your child as a beneficiary.

4.      Deaths. Having a loved one die is never easy. And when they were a part of your estate plan, their death should prompt a plan review sooner rather than later. You may need to name new beneficiaries, find a new Power of Attorney, update your health care proxy, or identify new guardians for your children. This should not be put on the back burner.

5.      Sickness. Becoming seriously ill causes many people to think about what they want at the end of their lives. You may need to draft an advanced directive, create an ethical will, or put any important funerary requests in writing.

6.      Moving. Moving to a different state can mean you are subject to different laws. Have a lawyer review your estate plan to ensure your documents will hold up in your new state. Some documents may need to be revised and you will certainly want to ensure any new real estate you acquire in your move is accounted for and properly funded to your plan.

7.      Asset Growth. More money means more problems but only if you don’t plan well. Revisiting your estate plan after experiencing a large gain in assets is essential to preserving and protecting those assets both now and after death.

If you are anticipating or have recently experienced one of these major life events, a revision of your existing estate plan may be in order. Having your own personal family attorney can be invaluable in helping you review – and if necessary adjust – your estate plan to ensure your assets will be protected and your family will be provided for throughout the changes in your life. When you are ready to take that step, we’re here for you.

Dedicated to your family’s health, wealth, and happiness,

Is it time to have “the talk” with your kids? I’m not talking about a “birds and bees” talk but one that is equally important, perhaps even more so.

Everyone has concerns about what will happen when they die. Some people worry about their homes, cars, or money. Others worry about their children. Rare, however, is the person who actually wants to talk about these things with their families.

Opening these conversations with your family will be difficult, but nowhere near as difficult as it would be on your family in the absence of advanced planning. Fortunately, there are steps you can take before – and during – the conversation to help it go more smoothly.

Preparation Is Paramount

As with many things in life, preparation is a key to success in these types of conversations. First, when you designate key people in your plan, make sure you match the skills of the person to the job. For example, the executor of a will must be able to gather assets, prepare paperwork, handle finances, and deal with potential family disputes. It would be unwise to select an executor who lacks the ability to carry out these tasks.

Too often, people choose executors, trustees, guardians, and powers of attorney based on emotions or arbitrary factors, such as who is the oldest child or who might be offended if not chosen. These are difficult, demanding jobs, and you need to choose people who can handle them. It also helps to talk these issues through with an experienced attorney or confidant in advance of making your selections.

Next, prepare your paperwork before your family meeting. Work with your lawyer to make the best decisions possible, and commit them to writing. This will help reduce any misunderstandings about your wishes.

Before the meeting with your family, consider the questions that may arise. For example, if you are concerned that one child will be upset because you name another child executor, be ready to answer questions about why you made that decision. It may be that the person you chose is an accountant and would be well-suited for the job, or it may be that you’re concerned about overburdening the other child. Whatever the case, be prepared to offer your reasoning. Your explanation will go a long way toward reducing any hard feelings and potential disputes when the plan comes into play.

Come Prepared for Business

Once you have your family together, it is important that you not only let them know what your decisions are, but also that it is important to you that they support you and each other. Have copies of your documents available so your family can ask questions about them.

You should be prepared to answer potential questions. And remember, this may be an uncomfortable topic of discussion for your family members. If someone just can’t get onboard, remember that you are dealing with your life and your assets. The ultimate decisions as to how you handle them are yours, and you can even terminate the meeting if necessary. Also, make sure your family knows that your decisions may change as time goes on.

Finally, remember the goal for this discussion is to provide your family with more than just a set of legal documents outlining your wishes. By talking to them about your intentions you are helping them gain understanding, comfort, and even buy-in with your plan.

Dedicated to your family’s wealth, health, and happiness,