david edwards estate planning elder law

Stop Thief! 10 Things That Can Steal From Your Estate

If you’ve ever been robbed like I have, you know that awful feeling of violation and loss of control. More than the material things that are stolen, the loss of peace of mind and sense of security can have lasting effects.

When I had just started practicing law, I came home one night and saw muddy footprints on the carpet. I thought, “When did I track in mud?” Then it hit me — someone had broken a window and robbed my apartment! They didn’t get much; I didn’t have much for them to take. When it comes to your estate, there is a lot at risk.

As estate planning attorneys, we can’t protect your home, but we will work to protect your wealth and your legacy — protect it from thieves who could steal it.

What Is Robbery?

Robbery is when something of value is taken. When talking about estate planning, you can be robbed of money, but also so much more. You can be robbed of peace of mind, relationships, or even memories. There is a lot at stake if you don’t plan ahead.

Ten Thieves That Can Rob Your Estate

When creating a plan, it’s important to keep in mind these ten things that can do real damage to your plan:

  1. The IRS — Will your heirs pay unnecessary taxes? Well qualified estate planning attorneys should make sure your assets are set up to avoid issues like double taxation.
  2. Lack of organization — If you don’t have a plan for your wealth, you can’t control what happens to it.
  3. A spouse’s remarriage — If your spouse marries again, what will happen to your children’s inheritance? If your spouse has more children, will your wealth be divided among them as well?
  4. Your kids not being ready for wealth — If you were to die tomorrow, would your children be able to manage their newfound wealth? A thorough plan includes how much your kids get and when.
  5. Your kid’s divorce later in life — Estate planning attorneys make sure your wealth goes where you want it to go, regardless of the marital status of your children.
  6. A lack of training and communication with your family about your plan — I knew of a woman in her 70’s who lived by herself. Her husband had passed away a few years earlier. She had a daughter and two sons. One day she fell, broke her hip and had a mild stroke. She could no longer care for herself. The daughter who lived in town began to help her out. This daughter was never very good with money, but the family thought it made sense to grant her the Power of Attorney because the other kids lived out of town. As the daughter continued to care for her mom, many items from the house disappeared. Her brothers thought she was taking the stuff, but she adamantly denied it. Unfortunately, after the mother’s death, the siblings never spoke again.
  7. A lack of professional guidance you can trust — A very blessed man had been married 30 years to the love of his life. She was never considered a “stepmother” but a truly loving mom to his children. He completed a “do-it-yourself” estate plan. When he passed away, the family found his plan vague, confusing and lacking detail. His wife remembered him saying, “You’ll never want for anything.” His kids remembered hearing, “You will be treated fairly.” As the plan unfolded, both his wife and his kids thought the other side was being greedy and not honoring his wishes. On the brink of court, after two years and lot of legal fees, they compromised and settled the dispute. Sadly, the stepmom and the step kids never spoke again.
  8. Future lawsuits or liability — If you own a business, is your liability insulated from the business’ liability? What happens if your beneficiaries are ever sued? Estate planning attorneys can provide answers and solutions for these types of issues.
  9. Nursing home costs — The skyrocketing costs of aging in America necessitate your plan include provisions for long-term care for you and/or your spouse.
  10. Outdated legal documents — Effective estate planning attorneys help you keep your plan current so it can do what you intend for it to when the time comes.

What Would You Do If You Knew a Thief Was Coming?

When my old apartment was robbed, I didn’t expect it. It just came out of the blue. I have a friend who was in a different situation a while back. She lived in a great neighborhood. It was always very safe and quiet. But there was a time when houses started getting burglarized. Week after week, it was someone else. Would her house be next? She couldn’t know for sure, but she took steps to protect herself by installing a security system.

Nobody likes to think about it, but Benjamin Franklin told us only death and taxes are certain in this life. You know the time will come eventually. What estate planning “security system” do you have in place? If something isn’t right with your plan, would you even know it? Effective estate planning attorneys create and review existing plans to protect all you’ve worked so hard for.

5 Big Risks of Adding Your Kids to Your Bank Account

The Truth About Adding Your Kids to Your Bank Account

Many parents think that “adding their children’s names to their bank account” is an easy way to be sure their kids can help if something unexpected happens, but it can cause some unintended consequences. Legally, what you are doing is naming a child as a joint owner of the account. This can have big legal implications that you might not intend. Despite friends or bankers telling you it’s a good idea, this sort of “coffee shop” legal advice can cause big problems down the road.

While naming your child(ren) as joint owner of your bank account could insure that bills and other obligations can be taken care of without you, it is best to understand what other problems you may be creating for yourself and your child by adding them to your bank account.

5 Risks of Simply Adding Your Child’s Name to Your Bank Account

There are many potential issues that could come up later if you add your child to your bank account now. Here are just a few to think about:

  1. If you die, the child on the account gets all the money in the account. This can be a real problem if there are several children in your family, but you only named one of them on the account. Even if you intended for all the children to share the money upon your death, legally the money belongs to the child whose name is on the account.
  2. If the child on your account gets sued or divorced, YOUR money in your bank account could be at risk.
  3. If your child becomes disabled (through a car accident or a stroke) after you are already disabled, then their spouse will gain control of the account and your money.
  4. If creditors come after your child, they could come after YOUR money in the “joint account.”
  5. If your child is on the account as a joint owner, then they have every legal right to come and take ALL the money from the account anytime they want. And there is not much you could do legally to stop them from doing so. You’re probably thinking, “My child would NEVER do that.” But money makes people do strange things. We see it nearly everyday.

2 Solutions That Can Prevent Future Problems

1. Power of Attorney

If you want a child to be able to pay your bills if you are sick, then name them a Power of Attorney instead of adding them as a joint owner of your bank account.

2. Payable Upon Death

If you want your money to go to your child or children at death, use a payable on death designation or give instructions in your will or trust.

Experienced Estate Planning and Elder Law Attorneys Can Help

Ultimately, you need to find solutions to accomplish your goals without creating unintended problems down the line. This is why it’s important to have the help and advice of an experienced estate planning and elder law attorney. Attorneys use legal tools like Powers of Attorney, trusts, wills and payable upon death designations to make sure things will go smoothly upon death or disability.

The most effective attorneys can help you solve problems without causing extra stress and unwittingly creating more problems down the road. Experienced estate planning and elder law attorneys should be able to anticipate the potential problems that your current actions may cause and prevent them through the use of legal solutions.

To continue learning more on the topic, download our free report, 12 Reasons Not to Give Your Property or Your Money to Your Kids Right Now. We also offer free monthly workshops for the community — Wills & Trusts: How to Get Started and How to Protect Your House and Life Savings from the Nursing Home. You can find upcoming dates for those workshops here or give us a call at 217-726-9200 to save yourself a spot.

The St. Louis Rams & Beneficiary Designations

When the rules are in writing, you have to follow them. Unless you’re the NFL. 

I am a St. Louis Rams fan. Loyal from the time they arrived in St. Louis after failing to get a new stadium in Los Angeles. Like all Rams fans, I was really upset when they left St. Louis, even after witnessing a decade of historically bad football.

For those unfamiliar with the situation, the lease the Rams had allowed them to relocate to Los Angeles this past January. The Governor of Missouri appointed a task force to try and negotiate a new, long-term stadium deal to keep the Rams in St. Louis. The task force ultimately came up with an actionable proposal on a new riverfront stadium for the Rams.

But after the proposal was submitted, the NFL’s assigned committee recommended that teams in San Diego and Oakland (two cities that essentially had no stadium proposals) be allowed to move to L.A., instead of the Rams. Throughout the task force’s work, it appears the Rams’ ownership was uncooperative. They did not meet with the task force, talk to the media, or talk to the fans. All of this was in apparent disregard of the NFL’s relocation guidelines requiring good-faith negotiations and attempts to maximize fan support in their current home community.

In spite of all this, the league allowed the Rams to relocate to L.A.

It seems laughable to suggest that the NFL relocation guidelines were followed. An owner who refuses to take part in negotiations is not negotiating in good faith, and an owner who refuses to talk to fans or the media for four years after his intention to move has become public, is not operating in a manner that would maximize fan support.

As the Rams made the number one pick in the NFL draft this year, the fans in Los Angeles got to cheer on their new quarterback. I thought to myself: based on the NFL’s own guidelines, he should have been St. Louis’ new quarterback. I didn’t like seeing something end up in the wrong place because it seems unfair. 

Estate Planning Involves Written Rules That Have to be Followed

Unfortunately, we see unfair things all the time in our firm. In the estate-planning world, unlike the club of pro football owners, we can make written rules and trust that they will be followed. Unfortunately, too often people don’t pay close attention to the rules that are put in place through their own plans and beneficiary designations.

For example, in 1996, a man named Warren Hillman named his wife as beneficiary on his federal employee’s life insurance policy. They later divorced, and Mr. Hillman remarried four years later, but he never updated his beneficiary designation. When he died, his widow sought to claim the payout, but she was denied because she wasn’t the beneficiary. The dispute over that policy made it all the way to the U.S. Supreme Court. In 2013 the court ultimately granted the death benefits to the ex-wife because she was the listed beneficiary. (Read about more court cases involving problems with beneficiary designations on life insurance policies here.)

It’s pretty easy to picture an ex-wife enjoying money that a widow thought was rightfully hers; the same way I picture the fans in L.A. enjoying the sun and the Rams. Every day, we help clients coordinate their beneficiary designations with their estate plan to make sure everything ends up in the place you desire. After you’re gone, the best way to make sure your family knows your wishes is to leave them in writing. 

Be Sure to Update Your Beneficiary Designations in Writing

Your things (and your family) are far more important than a football team. Therefore, it is vitally important that you make sure your beneficiary designations are up to date and your estate plan is current.

Life is constantly changing, and when it does, your plan needs to be updated to reflect those changes. At Edwards Group, we have a special program that helps make sure your plan stays up to date. Read more about our Dynasty Program here.

If it’s been a while since you’ve updated your plan, give us a call at 217-726-9200 or plan to attend one of our upcoming workshops.

 

 

IRA

7 Questions to Ask In Order to Do Effective IRA Planning

IRA planning can be tricky. In order to make sure you plan as best as you can, you should discuss the following questions with your attorney and other advisors:

1. Will you need the IRA funds during your life? If not, you may want to convert to a Roth or use the RMD’s to purchase life insurance to grow the wealth going to your family.

2. Will your heirs need it shortly after your death? If so, then the stretch out is not relevant.

3. Are you doing any charitable giving? If so, use the IRA to do it, if possible. That way the contribution is tax free.

4. Do you want to protect what you are leaving to family from their future divorces, lawsuits, creditors, poor judgment, wild spending, etc.? If so, you need protective trusts for each of your heirs. An IRA can go to a properly set up trust and still get the “stretch out”.

5. Are you facing estate tax at your death? If so, you need careful planning to avoid a double tax. An IRA subject to both estate tax and income tax can sometimes lose 75% or more to taxes!

6. Are you in a 2nd marriage? His kids and her kids? If so, be careful leaving your IRA to your spouse. You want to balance out your wishes for your kids with your desire to provide for your spouse. You can’t assume you can leave the IRA to your spouse who will later leave it to your kids. First, it may be spent and gone. Second, your spouse has every legal right to change the beneficiary after your death (to his/her own children).

7. Is your IRA (or other tax deferred retirement plan) a large percentage of your total estate? If so, then even more is at risk. You need careful planning, and it’s vitally important you consult with a professional.

Effective IRA planning is very important in effective estate planning. Give us a call today at 217-726-9200 if you have any questions, or check out one of our upcoming workshops to find out more about effective planning.

Advice for Those Who Haven’t Planned Yet

Michelle and I don’t gamble very often. But when we do, watch out!

A few years go, the kids went to the grandparents’ and we spent the weekend in St. Louis. We were staying near Laclede’s Landing at a new hotel near the Lumiere Place Casino. The evening after we checked in, we headed out to do some serious gambling.

We stopped at the penny slots and started playing. About 10 minutes later, we hit a big jackpot! Being up all of $12, we decided to quit while we were ahead.

Do you enjoy gambling? We find that most of our clients don’t like to roll the dice about their planning. Instead, they want to tie it down so they can have real peace of mind.

Not planning ahead to protect your family and your assets is gambling.

What will happen if you die suddenly? What will happen if you need long term care?

Leaving things to chance is a gamble and the losses can be HUGE.

With good planning, you can have real peace of mind and not gamble that these vitally important things will just work out. By planning ahead, you can avoid these 4 hardships:

1. Stress. You wouldn’t purposefully place extra stress on your spouse or your kids, would you? But a lack of planning on your part can do just that, leaving everyone to wonder, “What should we do? Who do we contact?” Good planning makes it easier on your loved ones by providing a clear plan.

2. Delay. Messy estate plans take longer to wrap up, causing the stress and extra work of an estate to drag on and on. Good planning helps things get wrapped up as quickly as possible.

3. Conflict. Lack of planning can lead to arguments in the family. Arguments between siblings, between step-mom and step-kids, between nieces and nephews. Good planning will make it easy on the family, making less to fight about and less stress that can lead to conflict.

4. Loss of life savings. Lack of planning can result in the loss of your wealth — to the nursing home, to probate expenses, to taxes, to creditors or to wild spending by your heirs. Good planning will protect what you have worked so hard for.

If you’re interested in learning more about effective planning, check out one of our upcoming workshops. They are a free and no pressure way to get started! And, as always, if you have any questions at all or are unsure of what your next step should be, give us a call at 217-726-9200. Tarina would be more than happy to chat with you.

Get comfortable — no high-pressure sales tactics here

I remember a phone call I had with a company who sells software to law firms. Their product seemed like something that might be helpful, and I was interested to learn more. I spent an hour on the phone with this guy and things looked good — until the salesman ruined it.

In the last 5 minutes he got really pushy. I told him to give us a couple weeks to think about how this would fit with our firm and then check back with us. But he wouldn’t let it go. I’m sure he was following some sales training tactics he had been taught. Those tactics completely backfired.

I don’t want to be pushed into something I’m not sure about. I like to have time to think things over before I spend money. And I think most everybody feels that same way.

Nobody wants to be pressured into buying something they don’t really want or need.

And that’s one thing you’ll find about Edwards Group if you get to know us — I’m not a very “good” salesman. And I don’t want to be.

Why?

Because I don’t really want to sell you anything. What I want to do is educate you about the ways we can help your family.

We do things a little differently around here. Not everyone is a good fit to work with our firm. That’s why we focus so much of our attention and effort on making sure you’re educated about your options and the way things work before any payment is ever exchanged.

Because I’m not a good salesman, you don’t have to worry about being put in an uncomfortable situation or being coerced into agreeing to something that isn’t a good fit for your family.

Because I’m not a good salesman, you can be sure that if you decide to work with us, we’ll form a great team who can work together to protect your family.

And because of that, you don’t have to worry about wasting your hard-earned money on a plan that doesn’t fit your family or was designed with another family in mind. Each of our plans are designed in collaboration with you, with the unique needs of your family as the guiding force in the process.

We understand that meeting with a lawyer can be intimidating. That’s another part of the reason we’ve designed our process the way we have. We don’t mind if you take a little time to get to know us first.

Our free, no pressure workshops are a great way to learn more about the planning needs your family may have. They are also a great way to get to know our firm better. If, after attending a workshop, you would like to take the next step, you will receive $200 off your initial meeting fee.

Not ready to talk to a person yet? We have put a lot of our time into developing a website that contains helpful information about all aspects of planning. You’ll find hundreds of articles about estate planning, trusts, Veterans benefits, Medicaid and Medicare on our website. Feel free to use the search button to quickly get to what you need.

No matter what, I hope that you will take the time to learn about ways to protect your family and your assets. The other side of our practice involves helping people who didn’t plan properly clean up the mess that’s left behind. My sincere desire would be for every family to have effective planning strategies in place and for no family to have to experience the effects of bad planning. Take a step in the right direction today by attending a workshop, giving us a call, or signing up for our weekly email newsletter.

What kind of attorney are you?

“There are 2 other attorneys here at the career fair. Do you know what the difference is between me and them? They’re wearing suits!”

A few months ago I went to Grant Middle School’s Career Fair. I talked to 5 different groups of students about how I am the “other” kind of attorney.

Most people think of the lawyers they see on TV, who are in court, always suing people or defending criminals. I told the kids those are what we call litigation attorneys. But I’m not that kind.

I asked the students, “What other kind of attorney is there?” And all I got were blank looks.

Yes, there is another kind! Some call them “transactional” attorneys. These are the ones who deal with Wills, Trusts, estates, nursing home planning, contracts, real estate and business. This is what we do here at Edwards Group.

And you know what? Good work by us “other” attorneys means that a family will be less likely to need the court-going attorney later.

The best way to find out how we help families achieve peace of mind through planning is by attending one of our free workshops.

  • At our Intro to Edwards Group: Wills and Trusts Orientation you’ll learn the 4 main reasons most estate plans “just don’t work” and how our unique process avoids these problems.
  • At our Life Care Planning workshop, 13 Costly Misconceptions About Healthcare for Your Aging Parents, you’ll discover the 6 stages of Life Care Planning – and which stage you’re in right now, 7 essential questions to ask so your parents have an effective plan for the last decade of life, 3 smart ways to increase your parents’ monthly income and bring peace of mind, 12 reasons your parents should not give their property away right now, and much more.
  • Look for our upcoming workshop dates here and be sure to call 217-726-9200 to save your spot.

Can your estate plan pass the Down Low test?

What a Child’s Game Can Teach us About Planning…

In our house, the “Down Low, Too Slow” game is very popular. It goes like this:

Give me five (hand slap)

Way up high (another hand slap)

Down low (pull hand away before it can get slapped)

Too slow!!

It always gets a laugh out of the kids. Even after the 10th time in a row!

“Up High, Down Low” is also good estate planning advice. A good plan will include:

  1. NOW – look at your situation, finances, family. What are your goals and risks?
  2. UP HIGH – look at the older generation. When the older generation passes, will they be leaving you an inheritance that could create estate tax problems for you? Will they face nursing home costs that could impact the family? Will their lack of planning give you more stress later or more conflict with other siblings?
  3. DOWN LOW – look at your kids and grandkids. What is their financial situation? How will an inheritance impact them? Will they be ready for it? Will your daughter-in-law spend it all? Will it lead to extra taxes for the kids?

A good estate plan considers those older and younger than you. If you’re not sure about the state of your plan, give us a call at 217-726-9200. We’ll be happy to chat with you.

5 Reasons You Need a Trust

Trusts are a very valuable planning tool. When people think about estate planning, most people think about wills. While wills are the most basic/common tool for estate planning, trusts are an incredibly effective way to plan for things that wills can’t address. Trusts can be used to:

  1. Organize your assets so it’s easier on your family later.
  2. Set out instructions for when you’re not able to make your own decisions — either upon disability (like a stroke) or death.
  3. Keep things private. (All wills are public record.)
  4. Protect assets from creditors, divorces, kids who don’t know how to manage money and even future lawsuits you can’t anticipate (like car accidents).
  5. Reallocate assets to maximize long-term care benefits such as Medicaid or VA benefits.

If you’re ready to get started protecting what you’ve worked so hard for, call us at 217-726-9200 to schedule an initial appointment with one of our attorneys. If you want to learn more without any obligation, our free 1-hour workshop, “Intro to Edwards Group: Will and Trusts Orientation” is a great way to learn about the basics of wills and trusts while finding out why our approach is so unique and effective. After attending the workshop, if you decide to work with us, you’ll receive $200 off your Initial Meeting fee.

Your Bucket List for Estate Planning: Why a Trust Might Be Right for You

A recent movie with Morgan Freeman and Jack Nicholson inspired a lot of people to think about their bucket list – the things they would like to do before they die. While a trip around the world in a sailboat may seem a lot more exciting and glamorous than estate planning, thinking about what you want at the end of your life financially, and for those you love, can be even more important than achieving your bucket list. Join me as we explore a different kind of bucket list – one that will insure your loved ones, and the things that you’ve worked so hard for, are protected.

What is a trust?
When most people hear the word “trust,” they probably think of families like the Vanderbilts or Hiltons, but trusts are not just for the ultra wealthy. Established during the Crusades in the 12th and 13th centuries to protect the rights of landowners while away on their journey to the Middle East, trusts are still relevant and vitally important to the work I do everyday in helping my clients achieve their goals. You needn’t be a Rockefeller or a wealthy Englishman to benefit from the level of protection that trusts can offer in our modern life.

Why are trusts important?
I want you to think of a trust as a bucket. And what are buckets good for? They are helpful to put stuff in. When you create a trust, you are in essence creating a legal “bucket.” By placing assets like houses, vehicles, timeshares and farmland into that trust “bucket,” you are insuring that those assets will be managed according to your wishes, which will be written in the trust agreement by you and your legal advisor. Unlike a will, trusts can help protect and manage assets while you are still alive, but disabled in some regard.

How are trusts used?
So, how do you put stuff into the trust bucket? By directing assets into it, such as retitling bank or investment accounts, doing a deed to your house or farm, or changing beneficiary designations on life insurance. For everything that is in the trust bucket, you leave a set of instructions written in the trust agreement. You also name someone to carry out those instructions. That person (or bank or trust company) is called the trustee. The person you choose as trustee to manage your trust “bucket” has a fiduciary duty, which is one of the highest duties in the law, to carry out your wishes and do what is best for you – not what is best for them. They have to act in your best interest. If they don’t act properly, they can be taken to court.

The most important thing for your plan is to think about what you want to accomplish. What are your goals – for yourself and your family? Once we choose the goals (and I help clients do this nearly everyday), then we can see what tools will best accomplish those goals. A trust can often be the best tool to carry out goals such as:

  • Avoiding the delay and expense of probate court.
  • Transferring assets privately after death. (As opposed to a will, which is a public document.)
  • Protecting assets from a divorce or lawsuit.
  • Giving clear instructions for managing your money during your disability.
  • Organizing assets so someone else can help manage them.
  • Protecting assets from being used for nursing home costs.
  • Leaving money to someone who is too young or too unwise to handle it by himself or herself.
  • Avoiding estate taxes.
  • Preventing family fights regarding a family farm or business.
  • Balancing the wife and kids in a second marriage.

A trust is just one of the legal tools we at the Edwards Group use to carry out your goals and dreams. Our other tools include wills, powers of attorney, living wills, contracts, and deeds. A trust is one of the best tools we have to carry out your wishes and plan for a time when you might become incapacitated or pass away suddenly.

Remember, a trust is nothing more than a tool. It’s not a magic document. All it can do is carry out the instructions written in it. And the only assets it governs are those you actually put in the “bucket.” Call us today to schedule an appointment and get started on your bucket list!