Estate Planning

Tips for Selecting a Guardian for Minor Children

Published on: May 13, 2017 | by Ettinger Law Firm

Comprehensive estate planning is a deeply personal process. There are so many different factors to consider, and working with an experienced estate planning attorney can help streamline the process and ensure that you explore all of the aspects of estate planning that pertain to you. One of the most difficult parts of comprehensive estate planning is selecting a guardian for your minor children if both parents should become deceased or incapacitated at the same time, leaving neither able to care for any shared children. As difficult as the process can be, it is extremely important to undertake it so that the best interests of your children are provided for in a worst-case scenario. The following are some tips in approaching the guardian selection process and provide some important considerations for you to remember when selecting a guardian, and an experienced estate planning attorney can help you with the process.

Choose Compatible People

Most people put a great deal of planning and thought into how they choose to parent. It is important for your peace of mind as well as your children’s well-being that you select individuals that share a similar parenting style and outlook. If academics are important in your household, make sure that they are also important to prospective guardians. Additionally, making sure that individuals you are considering as guardians are ready to undertake the responsibility that comes with it is extremely important.

Estate Planning and Private Annuities

Published on: May 10, 2017 | by Ettinger Law Firm

As we remind our clients, tax concerns are a major part of a comprehensive estate planning strategy. Anticipating the potential tax consequences related to your estate as well as those that might arise prior to, during, or after the disposition of your assets is an integral part of making sure your loved ones don’t inherit a significant tax burden that limits the amount of assets you pass to them. For some individuals, private annuities may offer a way to avoid the high costs of estate taxes, gift taxes, and other taxes related to estate planning.

The Benefits of Private Annuities

Basically, private annuities can be used to help reduce your potential estate tax liability while avoiding the gift tax and securing a steady stream of income for the grantor. They are termed “private” because they are privately structured rather than created by some commercial entity. A private annuity allows the individual to essentially transfer that asset to the heir in exchange for lifetime payments for the property. As the person receiving the property will be paying the grantor for it, private annuities typically count as a sale instead of as a gift of property.

Long-Term Care Insurance and Estate Planning

Published on: May 2, 2017 | by Ettinger Law Firm

Almost every post, we remind people that estate planning is a comprehensive undertaking that has many different options that can be tailored for individual needs. Experienced estate planning attorneys can help clients understand the role that different option can play in the estate planning process. Another vehicle that can provide individuals and their loved ones with financial security is long-term care insurance. With the growing cost of medical care and the average life expectancy of people reaching 65 today at approximately 85 years of age, high healthcare costs can become a severe drain on a family’s financial resources. However, planning for the cost of long-term medical care can help you maintain the bulk of your estate to distribute to your heirs as you see fit.

What Is Long-Term Care Insurance?

Long-term care insurance not only protects your heirs from the expenses associated with caring for elderly family members, but can also help you prepare for the costs of caring for your aging family members. The purpose of long-term care insurance is to help offset the costs of long-term care that can come with age. For instance, caring for an aging family member that has developed cognitive impairments such as Alzheimer’s disease can sometimes require a daytime visiting nurse while you and your family are at work and/or school, or even around-the-clock medical care in a nursing home facility.

Estate Planning and Debt

Published on: April 28, 2017 | by Ettinger Law Firm

Estate planning is a complex process that involves a great deal of attention to detail. However, truly comprehensive estate planning goes beyond creating a Last Will and Testament or even a trust and includes things like understanding how debt will affect your estate once you die. The best way to avoid the negative effects of debt on your estate is, of course, to avoid debt. However, that is often impossible to do today. In fact, according to sources cited by a recent Yahoo! Finance article around 73 percent of Americans have outstanding debt when they die with an average debt of $62,000 per person. As such, it is important to understand your debt as well as how to manage it appropriately to minimize any potential financial burden such debt could cost your loved ones.

Different Types of Debt

There are several different types of debt, and understanding the differences between them as well as how each type will affect you can help you understand how to manage them. The first type of debt is secured debt. Secured debt is debt that has been guaranteed by some type of collateral. This allows lenders to provide better interest rates on secured debt because a default on such debt typically awards the collateral to the lender. The most common examples of secured debt include residences and vehicles.

Don’t Discount Social Security in Estate Planning

Published on: April 26, 2017 | by Ettinger Law Firm

One of the most important components of estate planning is ensuring that you have an in-depth understanding of your assets. Not only is this important at the onset of estate planning, but it is an important factor to consider when looking down the road to the future. With lawmakers painting a sometimes bleak and uncertain future for social security, many individuals are looking at ways to plan for their financial future in case they are unable to rely solely on social security. While this is certainly a wise financial move, discounting social security’s impact on your estate can be a costly mistake.

As it stands now, social security provides a steady stream of monthly income when conditions for its receipt are met. That’s not likely to drastically change anytime soon. Given that the current projected life expectancy for those turning 65 this year is approximately 85, those monthly payments could add up to around $1 million over the terms of period of installments. A recent article from MarketWatch.com reminds us that we should not discount the impact social security can have on our estates, and an experienced estate planning attorney can help you understand what social security benefits can meant to your estate.

Social Security as a Safety Net

Estate Tax Portability Elections and Extensions

Published on: April 23, 2017 | by Ettinger Law Firm

Laws governing estate planning are extremely complex and can change frequently. Working with an experienced estate planning attorney can help you anticipate changes to applicable laws as well as adjust your estate plan to continue providing the benefits you want whenever the law does change. One of the most misunderstood elements of estate planning involves the estate tax. Many individuals don’t believe the estate tax will apply to them because their estates are not large enough to exceed the exemption allowed, which in 2017 is $5.49 million for individuals and $10.98 million for married couples. While this is often true, many people often don’t calculate the value of their estate correctly. Even an otherwise average estate can exceed the exemption limit, especially if you factor in one spouse dying first and the second spouse inheriting the bulk of first spouse’s estate. However, there are tools that can protect your assets from the estate tax by keeping it within your allotted exemption amount.

Portability Elections

A portability election is a tool available to spouse’s that survive the other spouse. When one person in a marriage dies, their estate is totaled to determine what – if any – tax consequences are triggered. When a first-to-die spouse’s estate is completely covered by the individual estate tax exemption and the bulk of the assets within that estate pass to the surviving spouse, this can cause the surviving spouse’s estate to surpass the individual estate tax exemption limit so that the combined value of the estates of both the first-to-die spouse and surviving spouse are taxed when the surviving spouse passes away. A portability election allows a surviving spouse to use leftover exemption amounts from the first-to-die spouse so there is a chance that the surviving spouse’s personal exemption can be combined with the leftover exemption from the first-to-die spouse to shield the surviving spouse’s estate from the estate tax, too.

Millennials and Estate Planning

Published on: April 18, 2017 | by Ettinger Law Firm

Estate planning can be an uncomfortable and confusing topic for many people. Nobody necessarily likes thinking about what will happen when they die. However, estate planning is an important activity for adults to consider, even those in their 20s and 30s. A recent article from USA Today highlights the need for millennials to consider estate planning as part of their plans as they move forward. In fact, the article cites a 2015 study that found more than 60 percent of Americans don’t have a will. This number likely includes a disproportionate number of millennials.

Responsible Financial Planning

Responsible, comprehensive financial planning doesn’t just involve being good with money. In the still-lingering shadow of the most recent recession and with an increased potential to carry large amounts of student loan debt, it isn’t uncommon for millennials to have a sense of the importance of treating money responsibly. However, while short-term money management can provide the foundation for a lifetime of financial stability, it is important to keep long-term financial planning in mind, too. Long-term financial planning includes the creation of a comprehensive estate plan that includes documents such as a Last Will and Testament, power of attorney, trust, and/or other related financial planning documents. As the article notes, these things are not just important for older adults – but for everyone.

Creating a New York Health Care Proxy

Published on: April 13, 2017 | by Ettinger Law Firm

Comprehensive estate planning involves more than just creating a Last Will and Testament and possibly a trust for your heirs. Estate planning is also an opportunity for you to make sure that your wishes for end-of-life care and other related decisions are known to those who will administer your estate, your loved ones, and your estate planning attorney. For many people, part of end-of-life planning and care often includes nominating a Health Care Proxy. The State of New York Office of the Attorney General offers individuals some clarification and advice related to a New York Health Care Proxy.

Health care Proxy: An Introduction

In New York, a Health Care Proxy is available to anyone over the age of 18. The purpose of a Health Care Proxy is to allow you to appoint a trusted person to make health care decisions for you should you be unable to make such decisions yourself. The inability to make health care decisions could arise because you are being kept alive via artificial means such as life support machines or even because you are unconscious for certain medical reasons. When a health care agent has been entrusted with the authority to remove you from or prevent you from undergoing potentially life sustaining treatments or procedures, New York requires that a second doctor must confirm the original doctor’s determination that you are unable to make your own health care decisions.

Estate Planning Reminder – Planning for Pets

Published on: April 8, 2017 | by Ettinger Law Firm

Dogs, cats, parakeets, horses, iguanas, ferrets…no matter the pet you have in your life, chances are you treat them more like family than just a possession. We want to make sure our pets are comfortable, have the best food, have plenty of entertainment, are healthy, and enjoy a long, happy life. It is possible to make sure that those conditions exist for pets even after pet owners pass away. By utilizing a trust, you can help make sure that your best friend is well taken care of.

Pet Trusts

A recent article in USA Today talks about the function that a pet trust can serve. Pet care can be very expensive. There are grooming costs, medical costs, food costs, and other costs related to keeping a pet. Generally, the bigger the pet, the greater the cost of care can be. In fact, the article notes that Americans spent roughly $62.8 billion on pet care in 2016. While pet trusts are certainly less common than trusts created for human heirs, they can serve an important purpose in making sure that any pets you have can enjoy the same quality of life after your passing that you were able to provide for them.

GRATs and GRUTs

Published on: April 6, 2017 | by Ettinger Law Firm

If you have assets that will likely appreciate in value, including property that provides income or stocks that demonstrate growth potential, there are ways you can plan accordingly to help you avoid severe tax consequences that might otherwise be related to retaining these assets or allowing them to become part of your general estate.

Two potential vehicles for you to explore are grantor retained annuity trusts (GRATs) and grantor retained unitrusts (GRUTs). With both of these options, you retain an interest in the income from assets placed in the trust. While there are taxes associated with each of these, they may be less costly than other options depending on your individual circumstances.

The Basics