Arizona Family Court – Changes During the COVID-19 Pandemic

 

 

 

If you have a blended family and do not plan for what happens to your assets in the event of your incapacity or death, you are almost certainly guaranteeing hurt feelings, conflict, and maybe even a long, drawn out court battle.

 

So let’s start with clarity around what a blended family is and whether you have one. If you have stepchildren, or children from a prior marriage, or other people you consider “kin” who are not considered legal relatives in the eyes of the law, you’ve got a blended family.

 

Bottom line: if you have a blended family, you need an estate plan, and not just a will you created for yourself online, or a trust that isn’t specifically and intentionally designed to keep your family out of court and out of conflict. Period. End of story. Unless you are okay with setting your loved ones up for unnecessary heartache, confusion, and pain when something happens to you.

 

What Will the Law Do?

“Blended Families, once considered “non-traditional” families are swiftly becoming the norm. Currently 52% of married couples (or unmarried couples who live together) have a stepkin relationship of some kind, and 4 in 10 new marriages involve remarriage. So, clearly, this is no longer “non-traditional” but quite traditional, though our laws about what happens if you become incapacitated or die are still very much based on tradition.

 

Every state has different provisions for what happens when you become incapacitated or die, and the laws of California may not necessarily match your wishes.

 

For example, in California, all community property assets would go to your surviving spouse, and separate property assets would be distributed partially to a surviving spouse and partially to children, if living, in amounts depending on the number of surviving children.

 

This may not result in the outcome you want for your loved ones, especially if you have a blended family situation. If you have something different in mind as to how you would want things to go, there is good news. The state of California allows you to circumvent those laws, but only if you have an alternate plan in place BEFORE your incapacity or death.

 

Even within “traditional” families, I want to emphasize that having a full plan is the best way to provide for your loved ones. However, with “blended” families, carefully considered estate plans are often even more vital to avoid massive misunderstanding and conflict, and having your assets tied up in court instead of going to the people you want to receive them.

 

Disputes Between Spouse and Children from Previous Marriage

One of the most common problems that arises in a blended family is that the deceased’s children from a prior marriage and the surviving spouse end up in conflict. The courts are filled with these kinds of cases. But it doesn’t have to be that way.

 

When you’re considering all of this for the people you love, it’s important to have a trusted advisor who can help you look at the reality of what will happen if you become incapacitated or when you die. With the complexities of modern families, it’s far better to know and plan than to leave it up to the law or a court to decide. That way, not only do the people you love get the assets that you want them to receive, but you will also be saving them from years of potential legal conflict.

 

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

 

 

 

 

Wills, trusts, health care directives, powers of attorney, and legal guardian nominations are on many of our hearts and minds as COVID-19 compels us to face our own fragility and mortality.

It’s not as if we didn’t already know we are all mortal, but within our current reality, that mortality becomes all the more real. And one way to feel some control over what’s happening out there is to make sure we all have our legal affairs in order at home. That way, if something does happen to us, our families aren’t left with a big legal mess to clean up while they are grieving.

If you are trying to get your financial house in order right now, you may be just getting some basic documents in place. You may even be doing it yourself.

If that’s the case, it’s very important for you to know that the cost of a failed plan can be very high for the people you love. Plus, if your documents are not properly signed, they will not work—period. End of story. And if your documents don’t work, your family could be stuck in court or conflict, which is probably the exact thing you want to avoid by handling your estate planning now.

There are many ways plans fail, but one of the worst ways we see is when someone starts a plan and doesn’t get it signed properly. You do not want this to happen to your family, trust me. If you care enough about estate planning, you will want to make sure your plan will work when your family needs it.

That means you need to make sure your legal documents are actually signed and signed in the right way. Some legal documents require two witnesses, and some require notarization; however, in today’s social-distancing reality, these signatures could be difficult to come by. Some states have allowed remote notarization, California for some reason, has not.

While we understand you likely have a desire to get documents in place now, we also believe there is going to be a significant increase in conflict and litigation because of DIY estate planning documents for the future. Don’t let that happen to the people you love.

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

If you have pets, I’m sure you love them, but you may not have not provided any written or, better yet, legally documented instructions about what should happen to them if you become incapacitated or when you die. If you have, read this article with an eye to ensuring you’ve checked all the right boxes. If you haven’t, read on because it’s time to act, and this knowledge will make it easier for you to do things right.

Let’s start by looking at what happens if you become incapacitated or when you die if you’ve done nothing to ensure the well-being and care of your pets. It may be that if you do nothing, one or more of your friends and family will step forward to take care of your pets. But, will the person who steps forward be the person you would choose? And, will they take care of your pets the way you want?

If you do care, you need to take action rather than just leaving the well-being and care of your pets to chance. If you don’t designate at least one person, and ideally one person plus backups to care for your pets, and provide instructions to the people you’ve named, and perhaps also money to support the care of your pets, your pets could become a burden to your friends and family, or even end up at the humane society.

Steps to Plan for Your Pet’s Care in Your Estate Plan
So, step one in all circumstances is to legally name the people you would want to care for your pets in the event you cannot.

Step two is to give the people you’ve named specific instructions about how you want your pets to be cared for if you cannot do it including type and amounts of food, any medications needed, exercise plan, and any other special things you know about your pets that any caretaker should know.

Finally, step three is to consider whether you need to provide financial resources to care for your pets.

If your pet has any special needs, or if you want to provide funding for training, regular exercise, or a certain kind of food or care, it’s up to you to provide the financial resources to the people you’ve named to take care of your pets. All of this can be included as part of your comprehensive estate plan.

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

A last will and testament can ensure your wishes are respected when you die. But if your will isn’t legally valid, those wishes might not actually be carried out, and instead the laws of “intestate succession” would apply, meaning that the state decides who gets your stuff, and it’s very likely not to be who you would choose.

If you’ve created a will online, we congratulate you for doing SOMETHING, but I strongly recommend that you have it reviewed and make sure it does what you want and is actually legally valid. I’ve seen it far too many times: someone THINKS they’ve created a will, because they did something, but the SOMETHING was the WRONG THING, and their family is left to deal with the fallout, confusion and complications that result.

The validity of a will depends on where you live when you die, as last will and testament laws vary from state to state. California requires wills to meet the following criteria in order to be legally binding:

The Essential Requirements
You must be at least 18 years old or an emancipated minor to create a legally valid will.

  • You must be of sound mind and capable of understanding your intentions for your estate, who you want to be a beneficiary, and your relationship with those people when you create your will.
  • You must sign your will or direct someone else to sign it if you are physically incapable of doing so.
  • There must be at least two witnesses—who are not beneficiaries— present at the signing.

Handwritten Wills
You may write a holographic will, which means a will that is written completely in your own hand, with no other printed material on the page. In that case, there are no witnesses required, and, in fact, having a witness would make the will invalid because there must be no other writing other than your hand on the page for a holographic will to be valid.

When a Will Isn’t Valid
If your will does not adhere to the legal requirements, the court will declare it invalid. In this case, your estate would pass under California’s intestacy laws, which means your assets would go to your closest living relatives, as determined by the law. And that may or may not be who you would want to receive your assets.

Is a Will All You Need?
A will is a baseline foundation for any estate plan, but it might not be enough to protect your family. A will does not keep your assets out of court, and it does not operate in the event of your incapacity. It also does not ensure your minor children will only ever be cared for by whom you choose. And a will alone cannot ensure your loved ones receive your assets protected from unnecessary conflict or creditors.

The best way to ensure your will is legally valid is by consulting with an experienced estate planning attorney to confirm your will follows California’s laws and to evaluate your estate plan to ensure it will protect your wishes and provide for your family according to those wishes in the event of your incapacity, or when you die.

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

As you no doubt already know, on January 26, 2020, basketball legend Kobe Bryant was killed in a helicopter crash on a wooded hillside 30 miles north of Los Angeles. Also killed in the tragic accident was his 13-year-old daughter Gianna, and seven other passengers who were friends and colleagues of Kobe and his family. Kobe’s survived by his wife Vanessa and three other daughters: Natalia, 17, Bianka, 3, and Capri, 7 months.  The exact cause of the crash remains under investigation.

Kobe’s sudden death at age 41 has led to a huge outpouring of grief from fans across the world. Whenever someone so beloved dies so young, it highlights just how critical it is for every adult—but especially those with young children—to create an estate plan to ensure their loved ones are properly protected and provided for when they die or in the event of their incapacity.

While it’s too early to know the exact details of Kobe’s estate plan (and he very well may have planning vehicles in place to keep the public from ever knowing the full details), we can still learn from the issues his family and estate are likely to face in the aftermath of his death. I’m covering these issues in hopes that it will inspire you to remember that life is not guaranteed, every day is a gift, and your loved ones are counting on you to do the right thing for them now.

Kobe’s sports and business empire
Between his salary and endorsements during his 20-year career with the L.A. Lakers, Kobe earned an estimated $680 million. And that’s not counting the money he made from his numerous business ventures, licensing rights for his likeness, and extensive venture capital investments following his retirement from the NBA.

Given his business acumen and length of time in the spotlight, it’s highly unlikely Kobe died without at least some planning in place to protect his assets and his family. But even if Kobe did have a plan, when someone so young, wealthy, and successful passes away this unexpectedly in such a terrible accident, his family and estate will almost certainly face some potential threats and complications.

For example, due to his extreme wealth, Kobe likely created trusts and other planning strategies to remove some of his assets from his estate in order to reduce his federal estate-tax liability. However, because he was so young and still actively involved in numerous business ventures, it’s quite unlikely that all—or even the majority—of his assets had been fully transferred into those protective planning vehicles.

And seeing that Kobe owned the helicopter and the weather at the time was poor (many other flights had already been grounded), there’s also the real potential that the families of those killed in the crash will file civil lawsuits against his estate. Regardless of how extensive Kobe’s estate plan is, it’s doubtful that the lawyers who drafted his plan considered the possibility of so many potential wrongful-death lawsuits.

Here’s the bottom line: the post-death handling of Kobe’s affairs is surely going to be complicated. Though you almost certainly don’t have a Kobe-size estate to pass on, that makes it even more important for you to handle your planning—and really get it done right. Kobe’s family can afford years in court, lawyers upon lawyers, and a loss of some assets to taxes and lawsuits. Your family, on the other hand, probably cannot.

Trusted support when it’s needed most
Since Kobe’s wife Vanessa survives him, and it’s been widely reported that they married without a prenuptial agreement, it’s most likely that she will inherit everything. And due to the “spousal exemption,” those assets will pass to her tax free. Yet despite the protection from estate taxes, if she does inherit everything directly, all the estate-planning, financial-planning, business-management, and wealth-preservation responsibilities for Kobe’s immense fortune will now pass to Vanessa.

That’s an overwhelming responsibility, especially while she’s mourning the loss of both her husband and child, as well as parenting three other daughters who’ve just lost their father and sister. Given the vast scope of Kobe’s estate, ongoing business ventures, and likelihood of lawsuits and other legal complications, Vanessa will need the advice and support of her trusted counsel now more than ever. And I do hope she has that support, and that it was established well before this point in time.

Unfortunately, many estate planning firms do not engage with the whole family when creating estate plans and the associated legal documents, leaving the spouse and other family members largely out of the loop. Though we can’t know if this was the case with Kobe’s lawyers, such situations occur frequently enough that there’s a real possibility this could be true for Vanessa as well.

Don’t let such a scenario be true for your family. There is immense value in not only getting your estate planning handled now, but also in accomplishing that with a family-centered law firm as your partner.

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

If your child requires or is likely to require governmental assistance to meet their basic needs, do not leave money directly to your child. Instead, establish a Special Needs Trust.

A trust that is not designed with your child’s special needs in mind will probably render your child ineligible for essential benefits. A Special Needs Trust is designed to manage resources while maintaining the individual’s eligibility for government benefits. Planning is important because many beneficiaries as adults will rely on government benefits for support. If the disabled person has assets in their own name, they might lose eligibility.

Medicaid, and other public benefits programs, will not pay for everything your child might need. A Special Needs Trust can pay for medical and dental expenses, annual independent check-ups, necessary or desirable equipment (such as a specially equipped van), training and education, insurance, transportation, and special foods.

Unfortunately, some Special Needs Trusts are unnecessarily restrictive and generic. Many trusts are not customized to the particular child’s needs. Thus, the child fails to receive the support and benefits that the parent provided when they were alive. For example, children who are high functioning and active in their communities can benefit from a Special Needs Trust that is carefully tailored to provide adequate resources to support their social lives.

Does your child have significant medical concerns? Should the trust allow for birthday gifts for other family members? What about travel expenses to visit loved ones? Do you have a preferred living arrangement for your child? Your child’s special needs trust should address all these issues and more.

Another mistake attorneys with special knowledge in this area often see is a “pay-back” provision in the trust rather than allowing the remainder of the trust to go to others upon the death of the child with special needs. If a “pay-back” provision is included unnecessarily, Medicaid will receive the remainder (up to the amount of benefits provided) in the trust upon the death of the beneficiary. These “pay-back” provisions, however, are necessary in certain types of special needs trusts. An attorney who knows the difference can save your family a small fortune.

A Special Needs Trust will help you avoid one of the most common mistakes parents make. Although many people with disabilities rely on SSI, Medicaid, or other needs-based government benefits, you may have been advised to disinherit your child with disabilities—the child who needs your help the most—to protect that child’s public benefits. These benefits, however, rarely provide more than subsistence, and this “solution” does not allow you to help your child after you are incapacitated or gone.

Disinheriting your child with special needs might be a temporary solution if your other children are financially secure and have money to spare. But permanently disinheriting your child with special needs could be a huge mistake! It is not a solution that will protect your child after you and your spouse are gone. The money can be lost in a lawsuit, divorce, liability claim, or adverse judgment against your other children. For example, what if your child with the money divorces? His or her spouse may be entitled to half of it and will likely not care for your child with special needs. What if your child with the money dies or becomes incapacitated while your child with special needs is still living?

These are just some of the concerns parents of special needs children need to navigate. The bottom line is to get a special needs trust in place with the help of an advisor who understands the unique issues inherent with special needs situations.

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

Both wills and trusts are estate planning documents that can be used to pass your wealth and property to your loved ones upon your death. However, trusts come with some distinct advantages over wills that you should consider when creating your plan.

That said, when comparing the two planning tools, you won’t necessarily be choosing between one or the other—most plans include both. Indeed, a will is a foundational part of every person’s estate plan, but you may want to combine your will with a living trust to avoid the blind spots inherent in plans that rely solely on a will.

Here are four reasons you might want to consider adding a trust to your estate plan:

1. Avoidance of probate

One of the primary advantages a living trust has over a will is that a living trust does not have to go through probate. Probate is the court process through which assets left in your will are distributed to your heirs upon your death.

During probate, the court oversees your will’s administration, ensuring your property is distributed according to your wishes, with automatic supervision to handle any disputes. Probate proceedings can drag out for months or even years, and your family will likely have to hire an attorney to represent them, which can result in costly legal fees that can drain your estate.

Bottom line: If your estate plan consists of a will alone, you are guaranteeing your family will have to go to court if you become incapacitated or when you die.

However, if your assets are titled properly in the name of your living trust, your family could avoid court altogether. In fact, assets held in a trust pass directly to your loved ones upon your death, without the need for any court intervention whatsoever. This can save your loved ones major time, money, and stress while dealing with the aftermath of your death.

2. Privacy
Probate is not only costly and time consuming, it’s also public. Once in probate, your will becomes part of the public record. This means anyone who’s interested can see the contents of your estate, who your beneficiaries are, as well as what and how much your loved ones inherit, making them tempting targets for frauds and scammers.

Using a living trust, the distribution of your assets can happen in the privacy of our office, so the contents and terms of your trust will remain completely private. The only instance in which your trust would become open to the public is if someone challenges the document in court.

3. A plan for incapacity
A will only governs the distribution of your assets upon your death. It offers zero protection if you become incapacitated and are unable to make decisions about your own medical, financial, and legal needs. If you become incapacitated with only a will in place, your family will have to petition the court to appoint a guardian to handle your affairs.

Like probate, guardianship proceedings can be extremely costly, time consuming, and emotional for your loved ones. And there’s always the possibility that the court could appoint a family member you’d never want making such critical decisions on your behalf. Or the court might even select a professional guardian, putting a total stranger in control of just about every aspect of your life.

With a living trust, however, you can include provisions that appoint someone of your choosing—not the court’s—to handle your assets if you’re unable to do so. Combined with a well-drafted medical power of attorney and living will, a trust can keep your family out of court and conflict in the event of your incapacity.

4. Enhanced control over asset distribution
Another advantage a trust has over just having a will is the level of control they offer you when it comes to distributing assets to your heirs. By using a trust, you can specify when and how your heirs will receive your assets after your death.

For example, you could stipulate in the trust’s terms that the assets can only be distributed upon certain life events, such as the completion of college or purchase of a home. Or you might spread out distribution of assets over your beneficiary’s lifetime, releasing a percentage of the assets at different ages or life stages.

In this way, you can help prevent your beneficiaries from blowing through their inheritance all at once and offer incentives for them to demonstrate responsible behavior. Plus, if the assets are held in trust, they’re protected from the beneficiaries’ creditors, lawsuits, and divorce, which is something else wills don’t provide.

If, for some reason, you do not want a living trust, you can use a testamentary trust to establish trusts in your will. A testamentary trust will not keep your family out of court, but it can allow you to control how and when your heirs receive your assets after your death.

An informed decision
The best way for you to determine whether your estate plan should include a living trust, a testamentary trust, or no trust at all is to meet with a trusted estate planning attorney. Sitting down with your Personal Family Attorney to discuss your family’s planning needs will empower you to feel 100% confident that you have the right combination of planning solutions in place for your family’s unique circumstances.

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

On January 1, 2020, the Setting Every Community Up for Retirement Enhancement Act (SECURE Act) went into effect, and it could have big implications for both your retirement and estate planning strategies—and not all of them are positive.

Last week, I gave you a general overview of the SECURE Act’s most impactful provisions. Under the new law, your heirs could end up paying far more in income taxes than necessary when they inherit the assets in your retirement account. Moreover, the assets your heirs inherit could also end up at risk from creditors, lawsuits, or divorce. And this is true even for retirement assets held in certain protective trusts designed to shield those assets from such threats and maximize tax savings.

Here, we’ll cover the SECURE Act’s impact on your financial planning for retirement, offering strategies for maximizing your retirement account’s potential for growth, while minimizing tax liabilities and other risks that could arise in light of the legislation’s legal changes.

Tax-advantaged retirement planning

If your retirement account assets are held in a traditional IRA, you received a tax deduction when you put funds into that account, and now the investments in that account grow tax free as long as they remain in the account. When you eventually withdraw funds from the account, you’ll pay income taxes on that money based on your tax rate at the time.

If you withdraw those funds during retirement, your tax rate will likely (but not always) be lower than it is now. The combination of the upfront tax deduction on your initial investment with the likely lower tax rate on your withdrawal is what makes traditional IRAs such an attractive option for retirement planning.

Thanks to the SECURE Act, these retirement vehicles now come with even more benefits. Previously, you were required to start taking distributions from retirement accounts at age 70 ½. But under the SECURE Act, you are not required to start taking distributions until you reach 72, giving you an additional year-and-a-half to grow your retirement savings tax free.

The SECURE Act also eliminated the age restriction on contributions to traditional IRAs. Under prior law, those who continued working could not contribute to a traditional IRA once they reached 70 ½. Now you can continue making contributions to your IRA for as long as you and/or your spouse are still working.

From a financial-planning perspective, you’ll want to consider the effect these new rules could have on the goal for your retirement account assets. For example, will you need the assets you’ve been accumulating in your retirement account for your own use during retirement, or do you plan to pass those assets to your heirs? From there, you’ll want to consider the potential income-tax consequences of each scenario.

Your retirement account assets are extremely valuable, and you’ll want to ensure those assets are well managed both for yourself and future generations, so you should discuss these issues with your financial advisor as soon as possible. If you don’t already have a financial advisor, we’ll be happy to recommend a few we trust most.

And if you meet with us for a Family Estate Planning Session (or for a review of your existing plan) to discuss your options from a legal perspective, we can integrate your financial advisor into our meeting. Together, we can look at the specific goals you’re trying to achieve and determine the best ways to use your retirement-account assets to benefit yourself and your heirs.

Here are some things we would consider with you and your financial advisor:

Converting to a ROTH IRA
In light of the SECURE Act’s changes, you may want to consider converting your traditional IRA to a ROTH IRA. ROTH IRAs come with a potentially large tax bill up front, when you initially transition the account, but all earnings and future distributions from the account are tax free.

Life insurance trust options
Given the new distribution requirements for inherited IRAs, we can also look at whether it makes sense to withdraw the funds from your retirement account now, pay the resulting tax, and invest the remainder in life insurance. From there, you can set up a life insurance trust to hold the policy’s balance for your heirs.

By directing the death benefits of that insurance into a trust, you can avoid burdening your beneficiaries with the SECURE Act’s new tax requirements for withdrawals of inherited retirement assets as well as provide extended asset protection for the funds held in trust.

Charitable trust options
If you have charitable inclinations, we can consider using a charitable remainder trust (CRT). By naming the CRT as the beneficiary of your retirement account, when you pass away, the CRT would make monthly, quarterly, semi-annual, or annual distributions to your beneficiaries over their lifetime. Then, when the beneficiaries pass away, the remaining assets would be distributed to a charity of your choice.

The decision of whether to transition your traditional IRA into a ROTH IRA now, or cash out and buy insurance, or use a CRT to provide for your beneficiaries is a solvable “math problem.” Using the specific facts of your life goals as the elements that go into solving the problem, we can team up with your financial advisor to help you do the math and solve the equation.

Adjusting your plan
While the SECURE Act has significantly altered the tax implications for retirement planning and estate planning, as you can see, there are still plenty of tax-saving options available for managing your retirement account assets. But these options are only available if you plan for them.

If you don’t revise your plan to accommodate the SECURE Act’s new requirements, your family will pay the maximum amount of income taxes and lose valuable opportunities for asset-protection and wealth-creation as well. You’ve worked too hard for these assets to see them lost, squandered, or not pass to your heirs in the way you choose, so put this planning at the top of your new year’s resolution list.

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

As we head into the thick of the holiday season, you’re likely spending more time than usual surrounded by family and friends.

The holidays offer an opportunity to visit with loved ones you rarely see and get caught up on what’s been happening in everyone’s life. And though it might not seem like it, the holidays can also be a good time to discuss estate planning. In fact, with everyone you love—from the youngest to the oldest—gathered under one roof, the holidays provide the ideal opportunity to talk about planning.

That said, asking your uncle about his end-of-life wishes while he’s watching the football game probably isn’t the best way to get the conversation started. In order to make the discussion as productive as possible, consider the following tips.

1. Set aside a time and place to talk
Trying to discuss estate planning in an impromptu fashion over the dinner table or while opening Christmas gifts will most likely not be very productive. Your best bet is to schedule a time separate from the festivities, when you can all focus and talk without distractions or interruptions.

It’s also a good idea to be upfront with your family about the meeting’s purpose, so no one is taken by surprise, and are more prepared for the talk. Choose a setting that’s comfortable, quiet, and private. The more relaxed people are, the more likely they’ll be comfortable sharing about sensitive topics.

2. Create an agenda, and set a start and stop time

To ensure you can cover every subject you want to address, create a list of the most important points you want to cover—and do your best to stick to them. You should encourage open conversation but having a basic agenda of the items you want to address can help ensure you don’t forget anything.

Along those same lines, set a start and stop time for the conversation. This will help you keep the discussion on track and avoid having the conversation veer too far away from the main points you want to discuss. If anything significant comes up that you hadn’t planned on, you can always continue the discussion later.

Keep in mind that the goal is to simply get the planning conversation started, not work out all the specific details or dollar amounts.

3. Explain why planning is important
From the start, assure everyone that the conversation isn’t about prying into anyone’s finances, health, or personal relationships. Instead, it’s about providing for the family’s future security and wellbeing no matter what happens. It’s about ensuring that everyone’s wishes are clearly understood and honored, not about finding out how much money someone stands to inherit.

While some relatives might be reluctant to open up, being surrounded by the loved ones who will ultimately benefit from planning can make people more willing to discuss these sensitive subjects.

Talking about these issues is also a crucial way to avoid unnecessary conflict and expense down the road. When family members don’t clearly understand the rationale behind one another’s planning choices, I’ve seen it breed conflict, resentment, and costly legal battles.

4. Discuss your experience with planning
If you’ve already set up your plan, one way to get the discussion going is to explain the planning vehicles you have in place and why you chose them. Mention any specific questions or concerns you initially had about planning and how you addressed them. If you have loved ones who’ve yet to do any planning and have doubts about its usefulness, discuss any concerns they have in a sympathetic and supportive manner.

For the love of your family
Though death and incapacity can be awkward topics to discuss, talking about how to properly plan for such events can actually bring your family closer together this holiday season. In fact, our clients consistently share that after going through our estate planning process they feel more connected to the people they love the most. And they also feel clearer about the lives they want to live during the short time we have here on earth. 

When done right, planning can put your life and relationships into a much clearer focus and offer peace of mind knowing that the people you love most will be protected and provided for no matter what.

Most importantly this holiday season, enjoy being in the moment and strengthening your bonds with the important people in your life.

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

Last week, I shared the first part of this series on the dangers of do-it-yourself estate planning. Here, we’ll look at how online legal documents can also put your minor children at risk.

Given how far web-based technology has evolved, you might think online legal document services have advanced to the point where they’re a viable alternative to having your estate plan prepared by a lawyer.

After all, you’ve been able to prepare and file your taxes online for years, so what makes estate planning different? Aren’t lawyers using the very same forms you find on these document websites?

This kind of reasoning is exactly what do-it-yourself (DIY) planning services would like you to believe—but it’s far from true. Indeed, relying on generic, fill-in-blank planning documents can be one of the costliest planning mistakes you can make for your loved ones.

Online planning documents may appear to save you time and money, but keep in mind, just because you created “legal” documents doesn’t mean they will actually work when you (or most importantly, the people you love) need them. Without a thorough understanding of how the legal process works and impacts family dynamics upon your death or incapacity, you’ll likely make serious mistakes when creating a DIY plan.

Even worse, these mistakes won’t be discovered until it’s too late—and the loved ones you were trying to protect will be the very ones forced to clean up your mess or get stuck with a huge nightmare.

Putting your children at risk
Knowing that your DIY plan could fail and force your family into court and conflict is distressing enough. But imagine how you’d feel if you knew that your attempt to save money on your estate plan caused your children to be taken into the care of strangers, even temporarily.Yet this is exactly what could happen if you rely on a generic will and/or other legal documents you find online to name legal guardians for your kids. In fact, this could happen even if you create a plan with a lawyer who isn’t trained to plan for the unique needs of parents with minor children.
Naming and legally documenting guardians for your kids might seem like a straightforward process, but it entails a number of complexities most people aren’t aware of. Even lawyers with decades of experience typically make at least one of six mistakes when naming long-term legal guardians.

What’s so complicated about naming guardians?
Some DIY wills allow you to name legal guardians for your kids in the event of your death, and that’s a good start. But does it allow you to name back-up candidates in case your first choice is unable to serve?

If you named a married couple to serve and one of them is unavailable due to injury, death, or divorce, what happens then? Would it still be okay if only one of them can serve as your child’s guardian? And does it matter which one it is?

What would happen if you become incapacitated by illness or injury and are unable to care for your kids? You might assume the guardians named in your DIY will would automatically get custody, but did you know that a will only goes into effect upon your death and does nothing to protect your kids in the event of your incapacity?

Do the guardians you named live far from your home? If so, how long would it take them to make it to your house to pick up your kids: a few hours, a few days, a few weeks? Who would care for your kids until those guardians arrive? Did you know that without legally binding arrangements for the immediate care of your children, they are likely to be placed with child protective services until those guardians arrive?

Even if you name family who live nearby as guardians, what happens if they are out of town or otherwise can’t get to your kids right away?

And assuming the guardians you named can immediately get to your home to pick up your kids, do they even know where your will is located? How will they prove they’re your children’s legal guardians if they can’t find your planning documents?

These are just a few of the potential complications that could arise if you try to create your own plan naming legal guardians for your kids. And if just one of these contingencies were to occur, your children would more than likely be placed into the care of strangers, even if it’s only for a short period of time.

The Child Protection Plan
Seeing all of the things that could go wrong, you should never trust the safety and care of your children to a DIY plan—or for that matter, a plan created by a lawyer unfamiliar with the unique needs of planning for parents of minor children.  To ensure your children are never raised by someone you don’t trust or taken into the custody of strangers, even temporarily, consider creating a Child Protection Plan™ – a comprehensive system designed specifically to address the inherent gaps in the way most estate plans document legal guardians.

Consider what’s at stake
The DIY approach might be a good idea if you’re looking to build a new deck for your backyard, but when it comes to estate planning, it’s one of the worst choices you can make. Are you really willing to put your family’s well-being and wealth at risk just to save a few bucks?

If you’ve yet to do any planning, stop putting it off and get started today – especially if you have minor children.

If you’ve already created a plan—whether it’s a DIY job or one created with another lawyer’s help—contact us if you’d like to schedule an Estate Plan Review and Check-Up. We’ll ensure your plan is not only properly drafted and updated, but that it has all the protections in place to prevent your children from ever being placed in the care of strangers or anyone you’d never want to raise them. 

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