Saturday, September 21, 2013

Should you give your kids their inheritance before you die?

LearnVest’s Libby Kane explains that while the word "inheritance" typically conjures up images of a will being read after a loved one's passing, many people don't want to wait that long to give money to their children.
A recent study from U.S. Trust shows that the majority of wealthy individuals feel it's important to leave an inheritance of some kind. In fact, 64 percent of those ages 49 to 67, and 72 percent of those 68 and older say they want to leave the next generation money. And at the same time,  more than half say they have provided or are providing significant financial support to adult children.
Leaving money to family earlier than expected isn't uncommon. But is it for you?
Why you should give early…
1. There may be tax benefits
2. You get to see the fruits of your labor

… and why you shouldn't
1.       You could come up short later
2.       Early giving can spur family drama
Read the full article
The bottom line: Like most financial choices, giving an early inheritance isn't always the right move. If it's on your mind, contact me to help you decide which option can best help you provide for your loved ones without compromising your own financial health.

Thursday, September 12, 2013

Basic Estate Planning

Robert D. Schwartz, an estate planning attorney in Florida outlined some essential documents in any estate plan in a recent article for TCPalm.

Last Will and Testament - the most basic estate planning document.  A will is a legal document which allows you to direct exactly where your assets are to be distributed when you die. An issue to consider with a will is that when you die your assets must go through probate before they are passed on to your named beneficiaries. Most people want to avoid probate and the most common way to accomplish this is with a revocable trust, also referred to as a living trust. The trust acts similarly to a will. It allows you to direct or put conditions on who gets your assets and when they get them. The biggest advantage of a trust is that it avoids probate. This means that you avoid expensive court proceedings, you preserve the privacy of your estate, and you minimize the emotional stress on your heirs. The key to a revocable trust is that it must be funded prior to your death. That means your assets must be re-titled into the name of the trust. If they are not re-titled, then they must be probated.
The Durable Power of Attorney is another extremely important estate-planning tool. This legal document allows you to select someone to handle your finances in the event that you cannot. No one can predict the crises that can occur in life. If something happens that leaves you unable to handle the business side of your life, this document can allow someone you trust to step in. That person can pay your bills, keep up your investments, or make key financial decisions in your best interests. If you become incapacitated without naming a Durable Power of Attorney, then the court will have to step in and through an expensive and time consuming proceeding, name a guardian to act on your behalf.
A health care surrogate is a legal document which allows someone to make medical and health-related decisions on your behalf if you are not able to. It is sometimes known as a Medical Power of Attorney, commonly called the “Living Will.” It is a statement of your wishes for what kind of life-prolonging treatment you want, or don’t want, in the event that you become terminally ill and unable to communicate. It applies to all instances in which you are incapacitated.
Having a solid estate plan can set your mind at ease. It is not only for your benefit, but for the benefit of your loved ones. Give me a call to set up a meeting to discuss your estate plan.