The Five Perils Estate Planning Avoids
- Avoid having the wrong person in charge of your affairs if you become disabled. With the number of elderly disabled skyrocketing as life expectancies continue to increase, each of us need a plan for disability. A properly prepared and "funded" (i.e. assets have been put into the trust) living trust offers powerful protection that the person or persons you choose will be in charge. You're only as good as your back-up plan.
- Having a probate court proceeding upon death. Wills have their place -- generally for younger families who are not likely to use them but still require a simple, inexpensive plan. Seniors are well advised to use living trusts to avoid probate court proceedings at death. Not only does this save significant time and expense in settling the estate, but upon death of trustee may act immediately. With a will assets may not be available for months or even years.
- Losing your assets to in-laws and their families. With a simple will, your son or daughter inherits your estate. But what happens if they die afterwards and are survived by a spouse? Generally, the inheritance you left your son or daughter ends up with their spouse and possibly whoever they decide to re-marry. Using an Inheritance Protection Trust allows you to leave an inheritance to your son or daughter but provide that in the event they die after you, the inheritance goes to your grandchildren or their surviving siblings.
- Losing your home and life savings to pay for long-term care. With the extraordinarily high cost of care in New York, many people lose all they have worked for to pay for their long-term care. The Medicaid Asset Protection Trust has been an effective tool for over thirty years to protect your assets from long-term care costs and help you qualify for Medicaid benefits to pay for your care.
- Losing hundreds of thousands or more in estate taxes. Fortunately, this only applies to the well-heeled -- those New Yorkers with estates over six million dollars. If this applies to you, and you have a spouse, you may arrange to double the exemption by setting up two "credit shelter" trusts before the first spouse dies.
It's never too early to plan, but it's often too late!