How To Be Mindful About the Potential of Elder Fraud

by Elder FraudEstate Planning

You may be worried about potential scams that could influence your elderly parents or other family members experiencing potential cognitive challenges. Taking proactive steps to recognize the common nature of elder fraud could help save your loved one and ensure that their assets are protected.

Especially if your loved one has a diagnosis of dementia or is showing signs of cognitive decline, it’s very important to:

Some of the best tips to keep in mind with regard to reducing elder fraud include:

  • Assisting a loved one to set up a system for paying bills automatically and electronically.
  • Watch for signs of dementia and the loss of executive processing skills which may make someone more vulnerable to elder fraud.
  • Add a trusted contact to certain financial accounts, such as a person who may be able to make decisions or monitor actions on behalf of the loved one.
  • Have someone within the family generate a personal balance sheet to keep an overall view of expenses and income in mind.
  • Hold family financial meetings regularly when the person is open to doing so.
  • Cancel extra or unused credit cards.
  • Monitor credit reports.

If you begin to notice sudden changes in a loved one’s finances, you may need to ask them further about the action steps they’ve taken or whether someone else has potentially gained access to their accounts recently.

Call a Pasadena estate planning law firm to work through the plans for your future and to help document your wishes now.

Estate Planning Helpful Even for Singles

by Estate Planning

If you’re a single individual, you may assume that estate planning is not to your benefit, or perhaps you’ve done the necessary step of taking the time to create a will but have not gone any further with your overall estate plan.

Estate planning, however, is beneficial for everyone. Documenting your wishes makes it possible for people you trust to make decisions for you in the event of sudden incapacity.

One recent study completed by Caring.com found that only around 1/3 of Americans have an estate plan, and more than half of people in the US pass away without a valid will, according to research from the American Bar Association. Estate planning can be challenging especially for single people, especially if you need to find qualified individuals to help you implement financial or medical decisions if you’re no longer able to do so.

You’ll also need to appoint someone known as your personal representative or your executor and this individual is responsible for handling estate administration after you pass away. Furthermore, even if you’re single but have minor children, you need to name someone who is responsible for taking over the responsibility for those children when you pass away.

What you don’t want is to hand things over to the courts to allow for state law to decide what happens to your children and to the remainder of your property. Hiring an experienced and qualified estate planning attorney in CA is one of the best ways you can protect yourself and ensure that you get the help and support you need when it comes to your future.

Should I Include A No Contest Clause In My Will?

by Estate PlanningWills

Creating estate planning documents and strategies makes things easier for the people appointed to handle your affairs and reduces the possibility of conflict in the future. However, some beneficiaries still retain the right to contest estate planning documents when they have legal grounds to show that these documents may have been procured by fraud or are otherwise invalid to begin with.

One way you may wish to reduce the possibility of someone contesting your will in the future is using what is known as a no contest clause. A no contest clause is designed to prevent people from challenging your will after you pass away. You may be concerned about someone coming forward angry that your estate plan doesn’t look like what you expected.

Typically, this clause says that a person who attacks a trust or a will, whether indirectly or directly, will lose anything they would have been entitled to under the terms of the document. With so much at stake in the transfer of assets, a loved one who may have thought about contesting a will might decide that it’s not worth the possibility of losing everything they were eligible to receive under the existing estate plan.

This leaves someone who is interested in potentially challenging a will with two options: accepting the terms of the will and their inheritance or potentially losing what they would have inherited otherwise. You should always discuss the inclusion of a no contest clause with an attorney who is familiar with the estate planning process.

Our Pasadena, California estate planning attorneys work with individuals, families, and business owners to help craft customized estate plans.

Is Your Estate Plan Missing Funeral Arrangements?

by Estate PlanningFuneral Arrangements

Estate planning is difficult for many people, but one commonly overlooked aspect is planning ahead for funeral arrangements. It can be very difficult to put your loved ones in the position of having to make these decisions for you, especially if they don’t know whether or not you had your own wishes expressed or prepaid for something. If no arrangements exist, it puts your loved ones in the position to answer important questions in which they may disagree with one another.

To make it easier on all of your loved ones, designate one person known as your executor or personal representative to handle the main responsibilities associated with your funeral and related issues. This gives peace of mind that everyone in your family has someone to look to.

You may prepay for a funeral or set up some other memorial service at the business of your choice in your area so your loved ones don’t even have to worry about these details.

Providing a letter of instruction about any previously purchased materials is also very beneficial when you’re thinking about planning ahead for the future. This makes sure that your loved ones know where to find the valuable information associated with your estate plan.

If you don’t make a formal designation of who you wish to take over your estate administration, this means your loved ones must go through a court process in order to have someone appointed. This can lead to unnecessary delays or costs. Working with a qualified estate planning attorney will help you work through these and many other important issues related to planning your estate. Contact our Pasadena, CA estate planning attorneys now.

 

How Does Tax Diversification Fit into Your Estate Plan?

by Estate PlanningFinancial PlanningTax PlanningTaxes

Your estate plan combines components of your future healthcare intentions, your goals for passing on assets to loved ones and your financial plan. Working with qualified professionals for each phase of this is extremely important for protecting your interests. One common thing overlooked by many people in the estate planning process is tax diversification.

The tax code is ever changing, and it is extremely important to think about how tax planning will influence you, especially for things like retirement income. This can include options like taking required minimum distributions from 401(k) plans and IRAs, which are considered tax advantaged accounts.

Your savings strategy now should prioritize diversification, which means thinking about three different groups of setting aside assets for retirement: tax free, tax later and tax now. How you break this down may require outside involvement from your estate planning professional, your CPA, and even your financial planner.

This may help you arrive at an appropriate budget for the future and help you decide which of these assets should be included in your estate plan.

If you wish to pass on particular assets to your loved ones, some of these may be included in your probate estate, but others, such as your retirement accounts may fall outside of your probate estate and may require filing a beneficiary designation form directly with that account management.

Need more support to determine how your estate, retirement, and tax planning all work together for the best interests of your future? Contact our Pasadena law office now.

The Value of Clear and Direct Language in Your Estate Planning

by Estate PlanningProbate

Avoid confusing or vague terminology throughout your estate plan as this can only cause more problems then intended. The process of undertaking an estate plan requires thinking intentionally about what you wish to achieve. But with unclear language, this opens the door for someone to file a probate or estate dispute.

Court intervention to resolve these disputes can be costly and problematic for your loved ones. Using phrases such as, “I hope”, “it’s my intention”, or “I wish” do not belong in your trust, will or other estate planning documents. There are some situations, however, when non-binding language could be beneficial for your estate representatives as well as your loved ones.

For example, maybe you wish to encourage your beneficiaries to hire and work with a financial advisor after receiving an inheritance.

Although you cannot require them to do this, it can be beneficial for them to understand your wishes and intentions. Furthermore, you might want to encourage someone appointed as your trustee to consider certain aspects when making decisions about most appropriate trust distributions, or you may have appointed multiple trustees that you hope will work together to make decisions collaboratively. This guidance can be included with the right terminology when you’ve partnered with a qualified estate planning attorney to help you.

Our Pasadena estate planning law office has years of experience serving California residents who need assistance with their estate plan.

What To Know Before You Move to A Tax-Advantaged Retirement State

by Estate PlanningRetirementRetirement PlanningTax PlanningTaxes

More elderly people are looking for ways to maximize their retirement savings and to account for the fact that they may live longer than expected. Moving to lower tax climates is a popular strategy for addressing these issues. However, you need to be aware of some of the potential pitfalls and challenges of moving to a state with no or low income tax.

Research from the US Census Bureau shows that two states with no state income tax, Florida and Texas, saw the biggest population increases from 2020 to 2021. Many of those residents moved from higher-tax states like New York, California, and Illinois. When changing your domicile, remember that you may be affected by other things, such as inheritance and state taxes or even potential wealth taxes.

You also want to consider any of the state laws and rules that govern things such as the administration of trusts, selection of trustees, estate administration and asset protection. You may find that you are paying the state in other ways like property taxes, higher inheritance taxes or fuel taxes, even if you’re saving on state income taxes. If you do choose to move, it is equally important to follow through by showing that the move is real. To get registering to vote or obtaining a driver’s license in the new state is not enough.

State revenue agencies may audit taxpayers who claim that they’ve re-domiciled but have not followed through on showing their true residence of the new location. Working with your estate planning lawyer and financial advisor can help you to ensure you’ve considered all aspects in moving to a new location.

New to California? Contact our estate planning office now.

Is a Trust Required to Avoid Probate?

by Estate PlanningProbateTrusts

Various estate planning myths could cost you the peace of mind that comes from knowing you’ve established documents and strategies to carry out your wishes as you want, and these could also harm your loved ones in the future.

The truth is that not all of your assets fall into the probate process anyways. Some things, like funds from your life insurance policy or retirement accounts, will transfer without going through the public process of probate. Other things can be designated as payable on death or transfer on death to help remove them from your probate estate, too.

One misconception is that you may assume that you need a trust to avoid probate. It can be beneficial to help you avoid probate and to accomplish other estate planning goals, however.

When you create a will, this will is submitted to the probate court when you pass away for the distribution of your assets. The will tells the court and your chosen executor important things, such as who is in charge of the estate, who is eligible to receive guardianship of any minor children and what happens to your assets. Wills do not avoid probate. In fact, this requires appropriately retitling your assets.

Probate is problematic because there are executor and legal fees involved, it can be time consuming, and information about your personal estate is entered into the private record. A trust is one way you could avoid probate, but there are other ways to avoid probate without a trust, such as transfer on death affidavits, joint and survivor assets and beneficiary designations for individual retirement accounts, life insurance policies, annuities, and 401(k) accounts.

Whether or not you need a trust is a conversation you should have with an experienced estate planning lawyer. Communicate with our Pasadena area estate planning lawyers for more support with your planning strategy.

When Is a Will Not Enough for Estate Planning?

by Estate PlanningProbateWills

Most people recognize that a will is one of the most important components of any estate plan, and yet plenty of people overlook it and never get around to creating a will. You may be most familiar with the benefit of a will after helping a loved one navigate the process of probate.

Being appointed as someone else’s executor or personal representative can open your eyes to the many challenges that may emerge when someone doesn’t do estate planning. A will is an important consideration in your estate plan, but it may not go far enough to cover all of your needs. Your will does allow you to name a guardian for any dependent minor children and helps you to decide who you want to receive certain property when you pass away.

With no will in place, the courts will determine who is appointed guardian for your children and who receives what. However, some assets do not pass outside of probate and therefore cannot be addressed in your will. This includes annuities, life insurance policies, individual retirement accounts and 401(k) plans. You will need to separately have beneficiary designation forms filed with each one of those management companies to ensure that your wishes have been documented. You may also need additional estate planning tools such as a trust, especially if you want to have further control over the transfer of those assets.

Bear in mind that you may be limited and who you can name as beneficiaries because issues like 401(k) plans may require your current spouse to be the beneficiary unless they legally agree otherwise.

Ready to talk through your options? Meet with our Pasadena estate planning lawyers now.

 

How Does My Estate Plan Impact the Financial Planning Process?

by Estate PlanningFinancial Planning

Estate planning and financial planning are connected. Decisions that you make for one will certainly impact the other. This is most applicable for decisions made over the course of your life, such as your decision over what to do with your retirement plan.

Setting retirement goals with the help of your financial professional is very valuable for helping you look forward to the point in time that you exit the workforce either entirely or from your primary position.

However, your retirement plan is also a very valuable asset in the estate planning picture. Your estate planning attorney can tell you more about naming a beneficiary to receive these assets if and when something happens to you. It is not as simple as deciding which person should be able to receive these assets and recording that in your will either.

Many retirement accounts pass outside of the probate process and forms must be filed specifically with the manager of the retirement account to ensure its streamlined asset transfer. Furthermore, depending on the age of your recipients and the type of retirement plan, there may also be tax considerations or account emptying considerations to walk through. Hiring an experienced and qualified estate planning lawyer is the best way to address these concerns.

 What Role Does an Accountant Play in Estate Planning?

One of the most important components of your estate plan is the decision you make about which estate planning lawyer to work with. You may already recognize the value in involving a team of professionals to help you in the estate planning process, since this considers issues during the course of your life, as well as those issues that may apply after you pass away.

Your CPA, financial advisor and estate planning attorney may all be familiar with various aspects of your plan and can help tell you more about what to consider going forward in the future. A CPA’s professional knowledge of taxes is very beneficial in helping provide input on an estate plan that suits your needs. Your CPA may also help you with things like gift tax returns, estate returns or tax preparation for 1040 and 1041 forms.

When Should I Involve a CPA?

When you create a comprehensive estate plan, it may be wise to involve a CPA in this process so that you are clear on the tax implications of every decision you make. This is also key for when thinking about making gifts to loved ones in your family, either during your life or after you pass away. Those individuals may also face tax consequences, and this can be very beneficial for making decisions about the most appropriate way to pass things on in the future.

Need help finding others to help you with your estate plan? Contact our office now.

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