Review Your Estate Plan

If you have not looked at your estate planning documents in a while, now is the time to do it. Before packing your toothbrush, look over your Will, durable power of attorney, revocable living trust, advanced medical directive, and any other documents that comprise your estate plan. Has your life changed since you signed these documents? Major life events like birth, death, marriage, and divorce tend to dramatically affect your estate plans.

In addition, consider reviewing your beneficiary designations. Remember, though, that your beneficiary designations and estate plan go hand-in-hand. In other words, each affects the other.

Get Ready to Make Some Changes

In between making flight reservations and buying a new carryon, make an appointment to see an estate planning attorney. Do this as far in advance of your vacation as possible, so your documents can be freshly signed before you leave.

Gather copies of your estate planning documents and any other information your lawyer requests before your meeting. You may be tempted to delay your estate plan review until after your vacation. Don’t wait. Your family depends on it.

Plan Your Estate Plan

At your meeting, it’s time to really get some planning done. You and your estate planning lawyer probably will review your plan documents together. Some people may be able to walk away secure that their estate plans are in order as-is. Others may have major changes to make before leave home.

Maybe you or someone with an interest in your estate has married or divorced since your last estate plan was written. You may need to add or remove people from your Will and plan documents.

Add Updating Your Estate Plan to Your Pre-Vacation Checklist

Your estate plan affects not only you but your family members and friends. It’s so important that it should be up to date before you set foot on that cruise ship or drive off to the family cabin.

Attorney Bruce Adams assists clients like you with their estate planning matters. Call us at 256-237-3339 to schedule an appointment. We are located in Anniston, Alabama, but help clients in surrounding Calhoun, Cleburne, Etowah, and St. Clair Counties.

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Basic Estate Planning

An estate plan typically consists of a Last Will and Testament (a “Will”), a durable power of attorney, and an advance directive (a healthcare power of attorney or living will, for example). Some people also add trusts to their estate plan. While you don’t fill out your beneficiary designations at your attorney’s office, they still affect your estate planning.

What may people don’t know is that your beneficiary designations generally trump your estate plan.

Beneficiary Designations, Generally

Insurance policies list at least one beneficiary to receive the insurance payout. Most financial institutions also allow their accountholders to submit beneficiary designations. These state who will receive funds remaining in the accounts when the accountholder dies.

Many people don’t realize that these beneficiary designations should be reviewed periodically to make sure they still reflect your wishes.

The “How”

Before meeting with your estate planning attorney, gather information about all your financial accounts. Know your financial account balances and insurance payouts. Then, make sure your estate planning attorney understands the full extent of your insurance policies, financial holdings, and investment accounts.

The funds you distribute through your beneficiary designations may affect how you distribute property through your estate. For example, Shawn split his estate three ways between his second wife and his two children. He compared the value of all his property, cash, investments, insurance, and so on. Then, he completed beneficiary designations for all his financial accounts. His attorney also cautioned him to review his estate plan and designations after any major life events.

The “Why”

After an accountholder passes away, accounts with beneficiary designations are paid out, usually without going through probate. Without careful planning, it’s possible that your estate will be distributed very differently than you had planned.

For example, Bella wanted to split her estate equally between her three children, with a small bequest going to her best friend, Julie. To make things easier, she makes Julie the beneficiary of a small investment account rather than naming her in the Will. Ten years later, Julie is shocked to learn that the investment account has done very, very well and she, in fact, will inherit more than Bella’s children. Obviously, this was not Bella’s intention, but she failed to coordinate her beneficiary designations with her estate plan.

Estate Plans and Beneficiary Designations Go Together Like Peanut Butter and Jelly

However, the peanut butter will not be harmed if the jelly is a little sloppy. The same cannot be said of your estate plans. Out-of-sync beneficiary designations have the potential to derail your carefully drafted estate plan and cause long-term problems for your heirs. Attorney Bruce Adams assists clients like you with their estate planning matters. Call us at 256-237-3339 to schedule an appointment. We are located in Anniston, Alabama, but help clients in surrounding Calhoun, Cleburne, Etowah, and St. Clair Counties.

The post How and Why to Coordinate Your Beneficiary Designations with Your Estate Plan appeared first on Bruce Adams.

And the Survey Says . . .

At a recent meeting of the Heckerling Institute on Estate Planning, discussion turned toward problems with estate planning. Specifically, a financial institution called TD Wealth conducted a survey to learn what issues can cause the most problems with an estate plan. The answer was a bit surprising.

Almost half of the survey respondents (46%) chose family conflict as the primary risk to estate planning. The second and third risks fell far behind: market volatility at 24 percent and tax reform at 14 percent.

The causes of family conflict were also identified:

• Designation of beneficiaries (30%),
• Failing to communicate the estate plan to family members (25%), and
• Dealing with blended families (21%).

So, what can you do to minimize or avoid family conflicts that might derail your estate plan?

Minimize Family Conflict

It is possible to plan ahead for family disagreements. Some of the following actions might help:

• Recognize that Family Conflict Exists. If your family gatherings involve skirmishes over minor problems, just think about the battles they may have over your estate plan. Be honest about how your family gets along.
• Communicate Your Plans. Take time to tell your family about your estate plan. Give bad news privately, rather than in a group meeting.
• Update Your Estate Plan as Needed. Life changes and so should your estate plan. Family conflict may be more likely to erupt if your estate plan is out of sync with your family’s circumstances.

One way to reduce family conflict is to make sure your estate plan complies with the law while clearly presenting your final preferences. For this, you need an experienced estate planning attorney.

Will Family Conflict Jeopardize Your Carefully Prepared Estate Plan?

Planning for family disagreements can go a long way toward preventing or at least minimizing them.

Call Bruce Adams. He has the skills and experience to help with your estate planning concerns. Please contact us at 256-237-3339 to set up an appointment or use the convenient Contact form on our website. Our office is located in Anniston, Alabama, but we assist clients in surrounding Calhoun, Cleburne, Etowah, and St. Clair Counties.

The post Is Family Conflict the Biggest Threat to Your Estate Plan? appeared first on Bruce Adams.

Why is an estate plan so important?

Only roughly 40% of Americans have prepared a Last Will and Testament. You could just let yourself join that number, but why? Writing a Will, a durable power of attorney, and an advanced directive is usually not difficult or overly expensive. More importantly, whether you prepare a Will or not, your estate probably will go through probate. State law will be calling the shots, however.

One of the greatest reasons to put together an estate plan is to spare your family the stress of making difficult decisions at a difficult time. For example, if you suddenly become incapacitated, someone will need to make medical decisions for you. Your advanced directive will name someone to do that. Your bills and financial matters won’t stop just because you no longer can take care of them. If you sign a durable power of attorney, you can appoint someone to handle those matters if you cannot.

And, of course, your Will provides for an orderly distribution of your worldly goods.

What are some common estate planning goals?

As you consult with your attorney, you probably will approach the meeting with some goals, including some of all of the following:

• Give your assets to specific people,
• Avoid probate by passing your assets to beneficiaries through a trust,
• Acknowledge the possibility of long-term care,
• Protect your assets from creditors,
• Protect your heirs’ inheritance for them,
• Establishing a legacy,
• Transfer property to heirs using strategies that promote efficiency, and
• Reduce or eliminate taxes.

Take some time at this time of the year to think about your future – and your family’s.

How can you get started?

Attorney Bruce Adams assists clients like you with their estate planning questions and concerns. Call us at 256-237-3339 to let us know you are ready to get started. We are located in Anniston, Alabama, but help clients in surrounding communities like Oxford, Jacksonville, Heflin, Gadsden, and Pell City.

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