Stapleton Elder Law

How Do You Do Estate Planning if You Don’t Have any Heirs?

Certain decisions are easier and others are more difficult, if someone has no heirs. However, you still need an estate plan to protect yourself in case of incapacity.

If you’ve never had children, then deciding how assets should be distributed and who to distribute them to could lead you to decide to support groups that have meaning to you. A harder decision is who to appoint as a decision maker for medical and financial decisions if you do not have a spouse or children.

CNBC’s recent article, “Planning your estate when you've got no children or heirs,” says there may be no close family members, resulting in questions of who they should leave their estate to. These people often don't know who to name as executor of their will or who to trust to make decisions for them, in the event that they become incapacitated.

Studies show that most childless people don’t make out a will. The issue with having no will (or “dying intestate”) is that the state will decides who gets your assets. Therefore, it is recommended that for those with no family ties or close friends, to focus on your interests and tie them to charitable giving. You can immediately establish your legacy and enjoy it while still living.

Another tough decision is choosing someone to have medical power of attorney, which allows that person to make important health-care decisions if you’re unable to do so. Married couples will usually name each other as their health-care proxy, but after the death of one spouse, the other with no children has the challenge of naming someone else. The same is true for childless singles who never married.

Likewise, a living will details your wishes if you’re on life support or suffer from a terminal illness. It also instructs your proxy's decision making. You also should give someone durable power of attorney to act as your agent if you’re unable to handle your finances. You can designate different people to handle healthcare and financial decisions.

You also need to designate someone to be the executor for your estate. This can be challenging for those without any family. The executor or “personal representative” has the legal authority to handle your estate. It should be someone you trust and someone who has the bandwidth to take on this responsibility.

If you can’t think of a person to name, your bank's trust division may be willing to serve as executor. You may also consider setting up a trust. Remember that some assets have beneficiaries, like 401(k) plans and life insurance policies. These accounts don’t pass through the will.

Whether or not you have children, or a spouse, you still need an estate plan to protect yourself while you are living. An experienced estate planning attorney can help you make the necessary preparations, including making the distribution of assets meaningful.

Reference: CNBC (May 31. 2017) “Planning your estate when you've got no children or heirs”

To learn more about creating an estate plan specific to your needs, please visit our website.

 

When Time is Critical, Where’s Your Health Care Proxy?

All too often, adult children are at a loss when their elderly parents encounter a health care emergency. If the kids can’t find health care proxies and DNRs (Do Not Resuscitate orders), they won’t be able to help their parents the way their parents had wished.

Before an emergency strikes, certain legal documents should be prepared so that children or other trusted family members will be able to help loved ones. Explain to elderly parents that this simply means that their wishes will be known and it is necessary to do this while they are healthy and well, or at least able to articulate their wishes. That means speaking with an estate planning attorney to have the documents created and also making sure that family members know where important papers are located.

Las Cruces Sun-News published an article recently about this topic, “Getting affairs in order,” that suggests if you have siblings or other relatives, you need to think about who will be the health care proxy.

Consider who among you shares similar views and values about life and medical decisions as your loved one.  You should also name an alternate proxy. It’s important to have a detailed living will, so that the loved one can choose the amount of authority the proxy will have over their medical care and the types of decisions he or she can make. Make sure that the proxy and alternate are comfortable with this responsibility. He or she must then complete the legal forms detailing their wishes. Start the process by talking with their doctor and consulting with an elder law attorney.

Failing to plan in advance may result in your inability to gain access to the information you need or to act on your loved one’s behalf, if they’re unable to do so. You can avoid time-consuming and costly court fights by working with your loved one to prepare these documents.

Other important health care documents include a medical directive or a “living will” or “advance health care directive” that describes the kind of care your loved one wants to receive if and when they become ill or incapacitated. This must be completed while your loved one is of sound mind and can decide what treatments they want to receive.

A durable power of attorney for health care allows you to make health care decisions for your loved one. On the other hand, a durable power of attorney for finances lets you manage your loved one’s financial affairs. A HIPAA release says that you have access to their health records and medical staff.

Another important document is a revocable living trust. This allows your loved one to retain control over their estate, while making transfers of his or her assets to beneficiaries. They select property to go into the trust and who will receive it. During their lifetime, they act as trustees (managers) of their own living trust. A revocable living trust allows the estate to avoid probate at the time of death.

A will needs to be prepared so that your loved one can convey their assets and other personal property as they see fit. An estate planning attorney will help draft and execute these documents. Remember that the documents are not simply written up and stored somewhere. Every four or five years they need to be updated to take into account changes in family situations and changes in the law.

Reference: Las Cruces Sun-News (January 1, 2017) “Getting affairs in order”

Please visit our website to learn more about the importance of appointing a health care power of attorney.

Organized Information Makes Difficult Times Easier for Family Members

Part One of putting your affairs in order is having an estate plan in place and updated on a regular basis. Part Two is getting your information organized and discussing it with loved ones.

If you were suddenly and unexpectedly to become incapacitated, would your spouse or adult children know where to find your important papers, be able to reach your estate planning attorney and know what you wanted, if an end-of-life care decision needed to be made?

The Daily Record’s recent article, “How to organize your affairs if you are a senior citizen,” says the first step is to collect your important personal, financial, and legal information so you can arrange it in a way that will benefit you now and your family in the future.  The next step is to create sets of important information and instructions concerning how you want certain things handled when you pass away or if you become incapacitated.

Here are some of the personal, legal, and financial items to consider:

Personal Information

• Make a list of contact information for close friends, clergy, doctors, and advisers such as your estate planning lawyer, accountant, and insurance agent.
• Make a list of medications that you and your spouse take and any allergies and illnesses.
• Include birth certificates, Social Security cards, marriage licenses, military discharge papers, and other important papers.
• List the locations that are locked or password protected, like safe deposit boxes, safe combinations, and security alarms.
• List the companies or people who provide services such as: phone, cable, electricity, etc.
• Write down specific instructions for the care of pets.
• Detail your wishes for organ and tissue donation, along with funeral instructions. If you have a pre-paid contract for the services of a funeral home, include a copy of the agreement.

Legal Documents

• Include all of your estate planning documents, such as your will and any trusts.
• A copy of your financial power of attorney that names a trusted agent to handle money matters if you’re incapacitated.
• A copy of your advance health care directives, including a living will and medical power of attorney, which detail your wishes for end-of-life medical treatment or when you are unable to communicate health decisions for yourself.

Financial Records

• Create a list of your accounts, brokerage and mutual fund accounts, and other financial assets.
• Make a list of loans, leases, or debts, like a mortgage, car loan, student loan, medical bills or credit card balances. Add to this list, all credit and charge cards with the card numbers and contact information.
• Note any retirement plans, pensions, or health benefits from your current or former employer with the contact information for the benefits administrator or HR Department.
• List insurance policies: life, long-term care, home, auto, Medicare, Medigap and prescription drug insurance policies with policy numbers and pertinent phone numbers.
• List real estate, vehicles, and other properties you own, rent or lease and include the deeds, titles, and loan or lease agreements.
• Detail the location of your tax records and your tax preparer’s contact information.

Having this critical information organized and in a secure location (a home safe or a fireproof box in your home office) will be very helpful for your spouse or adult children. Final point: make sure that family members know where the information has been located and if you use a locked box, make sure that a trusted and reliable family member has a spare.

Reference: The Norman (OK) Daily Record (January 2, 2017) “How to organize your affairs if you are a senior citizen”

Please visit our website to learn more about creating a well executed estate plan.

Why You Should Not Avoid This Difficult Conversation

It’s easy to talk with loved ones about happy events, but conversations about your end of life wishes are more important than you might think. Consider the arguments and hurt feelings that could be avoided, if your loved ones know exactly what you want, and why.

While most of our lives pass with only minor incidents, as we age the likelihood of being struck by a serious illness or having an accident increases. This means that our loved ones may face the difficult decisions that come with a parent’s passing. Making sure that your family members know what your end-of-life preferences are and discussing your wishes, along with putting an estate plan into place, can ease everyone’s mind and make a difficult situation a little less stressful.

The website seniorhomes.com recently posted an article, “10 Steps to Communicate Your End-of-Life Wishes.” According to the article, the most important question when it comes to communicating end-of-life wishes might be, “how to do it?” Luckily there are actions you can take to make the process easier for you and your family. Get going now, before it’s too late … and make it a priority.

Planning. There’s no better time than the present to let your family know about your final wishes. Start by drawing up a living will that states your treatment and care preferences in the event you are unable to speak for yourself.  You should also sign a durable power of attorney that appoints one or more family members or trusted friends to make medical decisions for you if you become incapacitated. Get that paperwork started today.

Clarity. It’s not pleasant to dwell on becoming too ill to make healthcare and other important decisions, but a critical injury or debilitating illness can occur at any time. As a result, it’s vital to be clear about your wishes as soon as possible—just in case.

Opportunity. Finding the appropriate time to discuss end-of-life issues can be tough, but there are certain events may give you the opportunity to do so. Possible occasions include those related to milestones like the birth of a child, marriage, death or serious illness of a loved one, retirement, an anniversary, during holiday gatherings, or when you create your will or other estate planning. Hopefully, you will have this conversation before an injury or a major illness that requires you or another family member to move out of the home and into a long-term care setting.

Discussions. Have these end-of-life conversations early to make certain that everyone understands your wishes. Your preferences may also change over time and necessitate future discussions on the subject.

Permission. Ask your loved ones for permission before launching into the topic. This will reassure them that you respect and honor their wishes.

Purpose. Your conversations with family need to include two important goals: (i) to be sure your financial and healthcare wishes are expressed and honored; and (ii) to give them the information and confidence they need to make future decisions.

Setting. Have the talk in a quiet and comfortable setting, such as a private spot without distractions. Be mindful of your state of mind and that of other family members.

Listening. Whatever your role in discussing end-of-life wishes, it’s important to listen carefully. Be certain that you hear and understand what your loved ones are saying.

Who participates in this conversation? Be aware that a loved one may want to talk about end-of-life wishes in private.

Pace. If you’re listening to a loved one express their wishes, led them set the pace and don’t argue about their wishes. They may not be your wishes, and they may not make sense to you, but these are their choices.

A respectful and thoughtful mindset will be needed, both by the person who is conveying their end-of-life wishes and family members. If for some reason, the conversation is not going well, you may find that an estate planning attorney can provide further pointers on how to help move the discussion along.

Reference: seniorhomes.com (December 22, 2016) “10 Steps to Communicate Your End-of-Life Wishes”

Please visit our website to learn more about discussing your end-of-life wishes.

 

Assign a Power of Attorney to Protect Yourself and Family Members

The power of attorney does not mean you are yielding control of your life. Instead, it will protect you, should something unexpected occur.

There are many unexpected ups and downs in life, and having an estate plan in place is how responsible adults do their best to protect themselves and their families, according to The Villager, in a recent article, “Power of attorney protects loved ones.”

A power of attorney (or “POA”) is a document that allows a person to designate a person or organization to manage his or her affairs in the event he or she is unable to do so. The specific laws for creating a power of attorney vary based on the state where a person lives, but there are some basics common to all.

Without a POA for financial, medical, and other pertinent information, family members may be unable to act without court intervention. In those cases, the state may appoint a person to make decisions for an individual, if there is no POA.

The main types of POA are the general power of attorney, health care power of attorney, durable power of attorney and special power of attorney. While some of the responsibilities in these documents can overlap, there are some legal differences. A durable power of attorney concerns all of the appointments involved in general. The document will remain in effect or take effect, if a person becomes mentally incompetent. Certain powers of attorney may terminate at a specific time.

Depending on the terms of the document, an agent appointed through a power of attorney may make decisions in the following areas for an incapacitated individual: banking, the sale or purchase of property, filing tax returns, coordinating government-supplied benefits, deciding medical care and making estate-planning decisions.

A power of attorney sounds like a straightforward document, but it is most effective when it is part of an overall estate plan. An experienced estate planning attorney will be able to create a plan that includes this and other critical estate planning documents that every family should have.

Reference: The Villager (December 14, 2016) “Power of attorney protects loved ones”

To learn more about the importance of having a Power of Attorney, please visit our website. 

When “The Talk” isn’t About the Birds and Bees

Conversations about money, death and dying wishes become tangled up in strong emotions surrounding these matters. A strategic approach might be helpful.

Every family is different, but almost every family struggles with conversations about wills, estate planning and money. A recent article in The Chicago Tribune, “Have the estate planning talk,” advises a thoughtful approach while letting you know that this is hard for everyone.

This is a tough topic because feelings and money get tied up. Money in many instances can conjure feelings of control (or lack of it), dignity, shame, fear, or a lack of confidence. Many conversations go south quickly. For example: if an adult son asks his mother if she and his father have recently updated their wills, he might be met with a response such as, "Why? Are you hoping we’ll die soon, so you can use your inheritance to finally pay off that huge mortgage we warned you not to take?"

You can see how these kinds of conversations can go downhill pretty fast, which is why everyone should resist the urge to take the bait that’s thrown out. Typically, that’s not the way it’s intended to work.

Rather than jumping into such a discussion with both eyes closed, think about just one issue to start—such as the re-titling of a bank account or making a beneficiary designation. This may help you get into a broader discussion on family finances and estate planning.

Once you get going with a meaningful discussion, ask your parents what goals they’re trying to accomplish, like making sure that assets are passed to the next generation and beyond … or are there concerns about an heir blowing all the money that’s left to him/her? Are there charities to remember in the estate plan?

Talking over these concerns with a qualified estate attorney can help you create an estate plan that addresses all of your issues and concerns. Remember that you’ll want to review your estate plan every few years.

The basic documents that most people need include a will (and don’t forget to name a guardian if you have minor children), a letter of instruction that conveys your wishes for burial or cremation, power of attorney, health care proxy and if applicable, trusts. The goal is to have these documents prepared long before they are expected to be needed.

There’s no way to make these conversations easier, but if you don’t have them now, and if the proper planning isn’t done in advance, the results will be costly and time consuming.

Reference: Chicago Tribune (October 20, 2016) “Have the estate planning talk”

Please visit our website to learn how to best approach your loved ones about yours or their planning.

 

Preparing for College? Include Legal Documents and Important Discussions

Unless you have the proper legal documents in place, once your child turns 18, you no longer have access to their health information or academic information and most importantly, you do not have the legal right to make medical decisions on their behalf. Preparing these documents before your child leaves for college is more important than furnishing a dorm room.

Preparing to send a child away to college for the first time is exciting, but there are serious issues to consider. A recent article from The Atlanta Journal-Constitution, “How to prepare for kid going off to college” addresses issues concerning healthcare and credit card finances.

Health care: When a child turns 18, you are able to continue to keep him/her on your insurance plan, but they’re considered a legal adult under HIPAA as far as disclosing health information. As a parent, you’re no longer legally permitted to access their health information when they go off to college and get sick or if they’re in a car accident and in the hospital. Because of the HIPAA restrictions, you should have an estate-planning attorney draw up a health-care power of attorney which names a parent or parents as their health-care agent. That way you can speak to healthcare professionals on their behalf if they are incapacitated, and you can obtain their medical information. Have a conversation with your child about the changes that happen when they become an adult and how a health-care power of attorney will protect them. Keep a copy of the document at home and have your son or daughter keep a copy at school. Scan it as well so you have it in electronic format to email to a physician or to an ER if needed.

Credit cards: Anyone under 21 applying for a credit card must have an independent source of funds to pay the bills, so that’s good news for parents. Many college freshmen use credit cards cosigned by parents. Parents should sign up for mobile alerts to monitor their student’s expenses, and talk to them about budgeting.

If your child goes on a shopping spree and there are payment issues, your credit is going to take a hit. You can avoid this by paying the bills yourself and having your kid reimburse you for his or her expenses each month. You can also go with a debit card instead of a credit card. When the money is gone, it’s gone. Another option is to add your child as an authorized user on your account so that he will have his own card and start to build a credit history. However, you’re the one managing the account.

While you’re thinking about all of these important issues, you also should take the time to review your estate planning now that your son or daughter is an adult and possibly is no longer living at home. Talk to your estate planning attorney about some of the common changes people consider at this point in the life of a family.

Please visit out website to learn more about helping prepare your child for college with the proper legal documents. 

Reference: The Atlanta Journal-Constitution (August 8, 2015) “How to prepare for kid going off to college”