david edwards estate plan

Secrets: 5 Things Your Adult Children Need to Know About Your Estate Plan

Parenting often involves keeping secrets, especially when the kids are little — remember all the secrecy surrounding Christmas or birthdays?

Back when my daughter was 4 years old my wife and I kept a big secret from her. For her 5th birthday we surprised her with a trip to Disney World in conjunction with an estate planning conference! (She was excited about the first, while I was pretty excited about the second.) It was hard to keep the secret at times, but it sure was a fun surprise when we pulled it off.

Estate Plan Secrets

Secrets can be fun. But where estate planning is concerned, they most definitely are not. Sometimes it’s hard to know what our kids may or may not know about our plan. Walt Disney’s daughter was once asked by kids at her school what it was like to be his daughter: She came home that night indignant, telling her dad, “You never told me you were Walt Disney!” Sometimes things that seem obvious to us might not be so obvious to our kids.

5 Things Your Kids Need to Know About Your Estate Plan

What do your kids know or not know about your estate plan? Here’s a quick checklist to consider:

  1. Burial — Do your kids know whether you want to be cremated or buried? If you want to be buried, where do you want to be buried? Have you already purchased a cemetery lot?
  2. Who to Call — Do your kids know who your attorney is or how to get a hold of him/her? Can he help tie up loose ends or was he only used to fill out forms and make them official during planning?
  3. Assets — Do your kids and/or family know what your assets are? If you suddenly have a stroke or heart attack can they easily find that information?
  4. End of Life — Are they clear about your wishes for ending treatment and “pulling the plug?” Do they know how you feel about organ donation?
  5. Your Plan — Do they know where to find your will, trust and/or powers of attorney? (And if they’re in your safe deposit box or home lock box, can they get in? Do they have the key or the combination?) Will your kids be surprised by your plan? (How you divided assets or whether you gave to charity…) Unfulfilled expectations can mean conflict between your kids or lifelong heartache for a child who misreads a plan as being a symbol of how the parent felt about them.

5 Tips to Make Sure There are No Secrets About Your Estate Plan

  1. Talk. Have conversations with your kids about aging, death and what will happen. There are good conversation starter resources at EngageWithGrace and The Conversation Project. You can also read our post on the subject HERE. The holidays, when families gather together, are a good time to get these conversations started.
  2. Find an experienced attorney. Work with an attorney who keeps your plan up to date through a membership program or a maintenance plan. That way, even if you don’t want to share all of your financial information with your kids now, the attorney will have it to provide them with later. Read about our program HERE.
  3. Don’t assume. Recognizing if your kids will know what to do or how to do it once you are gone can be really hard. Tell them what you expect now. Things like which advisor to rely on or “take care of your little sister” can go a long way.
  4. No surprises. Give your kids the overview of your plan, so they know what to expect. News such as, “I’m going to leave your brother the farm,” is better with an explanation from you now. Your attorney can help with this, providing as much or as little detail as you want.
  5. Don’t just fill out a form. Include purpose statements in your will or trust. Tell why you did what you did, or explain that “it is my intent” that the plan work a certain way.

Estate planning works much more smoothly when there are no secrets or surprises. Save your family a lot of money and heartache by doing a little work now. Read about how to avoid an estate battle after you’re gone HERE.

5 Estate Issues You and Your Family Should Plan For

“An ounce of prevention is worth a pound of cure.”

When it comes to estate planning, this quote from Benjamin Franklin could not be more true. Oftentimes, people don’t think of estate planning, or the issues related to it, until it is too late. As a firm who deals only with estate planning issues, we have seen our fair share of terrible problems that could have been prevented by planning ahead and creating an effective estate plan. Dave says it all the time, “Bad estate plans break up good families.”

Taking advantage of David’s unique perspective, in this post we’ll explore the most common problems he encounters every day — problems that could be avoided by just planning ahead. Here are 5 key issues you should consider as you create an effective estate plan:

“Assets? What assets?”

You might be surprised at how often those left behind have no idea about life insurance, stocks, bank accounts, etc. Discovering these “hidden” assets takes time, money, patience and a lot of detective work. And despite any dreams you once had of being Joe Friday, the last thing you want to do while mourning the loss of a loved one is play detective.

“Attorney? What attorney?”

Oftentimes those left behind have no idea if an attorney is needed, or if an attorney has already been consulted. Does looking in the phone book and calling the first attorney whose ad catches your fancy seem like the best way to handle your loved one’s estate after they’re gone? Many of our clients’ families meet us before they need us, ensuring that a trusting relationship is already in place and decreasing stress and anxiety when the time comes to execute the estate.

“Equal? What’s equal?”

Many people plan on just having their children split things equally upon their death. It seems like a beautifully simple and fair way to handle things, but when emotions run high and money or cherished possessions are at stake, things seldom go down the way you would expect. We often see conflicts between family members who have different ideas about how to handle things — conflict that could have been avoided with more in-depth preparation. We’ve also seen that seemingly good ideals like “equal” puts some adult kids at a disadvantage.

“Taxes? What taxes?”

Did you know your lack of planning could cost your family money? Without proper planning, they could end up paying extra income tax on IRAs or annuities (or pay them earlier than necessary). We see this quite often. To avoid this, you should get specific advice regarding your tax deferred accounts, both now and after death.

“Issues? What issues?”

There are a lot of unique circumstances that arise when dealing with minors or even young adult children. Are your kids prepared to responsibly handle what you’re leaving them? Have you distributed the wealth in such a way that the younger children will have adequate care for the proper amount of time? As experienced estate planning attorneys, we see the ramifications of families not being fully prepared all the time. We hate seeing this and don’t want any family to have to go through it. Our firm is experienced in thinking through every issue your family needs to consider when creating an effective plan.

So what do you imagine for your family after you’re gone? Do you imagine them having no idea what or where your assets are? Do you imagine them knowing exactly who to call or struggling to figure out who your attorney is? Do you imagine great stress and distress in the middle of their grief as they scramble to figure out what needs to be done? Surely not. Planning ahead is not being morbid or pessimistic. It is protecting and caring for those you love. (Get our free checklist, What to Do When a Loved One Dies, here.)

Find out more about effective planning across the lifespan by attending our free workshop, Aging With Confidence: 9 Keys to Wise Planning and Peace of Mind. Call us at 217-726-9200 to RSVP today. (Get the dates here.)

3 Proven Essentials That Will Make Your Plan Successful

Every estate plan has three elements that determine whether it succeeds or fails.

The ultimate measure of a plan’s success is, “Does it do what I want it to do in my absence?” With the following three components in place, your plan is much more likely to succeed.

1. Rules and Instructions

Successful planning means your wishes will be carried out, even when you are not there to do it yourself. Sometimes your wishes need to be carried out while you are alive but too sick to make decisions. Eventually, your wishes will be carried out after your death.

Even though some decisions may be challenging to make, you are the best person to create the rules and instructions. Why? Because you are the #1 expert on your family and your values. Nobody else understands your family or your values like you do!

The rules and instructions to be made will include decisions around medical care (including end of life) and your finances (bill paying while you are sick, or distributions or inheritance rules after your death).

The rules and instructions you set up need to reflect who you are. You want it to be more than a fill-in-the-blank document with your name typed in. Make sure your plan reflects who you are and your family’s unique circumstances.

2. Who’s in charge?

Having rules in place is not enough to make sure your plan is successful. You also need someone to carry out the rules and instructions. That person needs to be able to:

  • follow your wishes (and not just do whatever they want)
  • take action (and not procrastinate)
  • get legal or tax advice when needed (and not think they know it all)
  • deal with family disagreements gently but firmly.

The person you choose to carry out your wishes is your “helper” (executor, trustee, power of attorney). Choose wisely because the helper you select will make or break your plan.

3. What’s in the bucket?

Once you have the rules and instructions in place, and a helper to follow through on those rules, there is one remaining issue that will determine if your plan is a success.

To what do we apply the rules and instructions?

This is one of the most common problems with estate planning. Many people have assets and asset instructions that conflict. Perhaps their Last Will & Testament is inconsistent with their beneficiary designations. Maybe they have a Trust but nothing in the Trust. (Yes, this happens quite often.)

Your plan will not work unless it is clear which assets are governed by your instructions and your helper.

There are a surprising number of people who go through the effort of creating a Trust, but then they don’t put anything IN the Trust. We like to think of a Trust as a bucket. If nothing is in the bucket, or there are important assets missing from the bucket, then the plan will not work as you hoped.

To continue reading more about what makes a successful estate plan, check out our article and free resource: 6 Estate Planning Pitfalls to Avoid (Reasons Why Most Estate Plans Fail, Costing You Time, Money and Extra Stress)

To learn more about the basics of effective planning, plan to attend an upcoming workshop. Give us a call at 217-726-9200 to RSVP.

3 Things That Can Ruin Your Estate Plan

Don’t be caught with an out of date will. Keep the 3 L’s of estate planning in mind.

You’ve finally finished creating your will with your attorney – congratulations! It’s a big undertaking. You’re probably thinking it’s time to stash it in a safe place and forget about it. As long as your attorney has a copy, you’re okay right?

Wrong.

It’s important to update your will at least every three to five years (sometimes more often as laws or circumstances change). Taking the time to update your will can ensure that your legacy gets passed on according to your wishes and can also eliminate family disputes upon death. If you’re not sure whether your will needs to be updated, it’s best to follow the 3 L’s of estate planning. Many of the changes any estate plan faces can be summed up by examining the following 3 things: life, law and learning.

Life

What has changed in your family, your health, your job status or your finances since your last will was created? Have you purchased property or a business? Have you sold a business or property? Have you purchased a new car, boat or art? A lot can happen in 3 to 5 years, especially as we age. A great example would be if a divorce or remarriage happens within the family. This can impact family members emotionally and can restructure family organization. A timely update to your will can help you avoid family conflict and lengthy court time for your family after you have passed away. Life changes warrant an updated will. (When it comes to life changes, don’t forget your beneficiary designations on things like life insurance!)

Law

What legal or tax changes have occurred in federal or state law since your will was drafted? Have your federal tax laws changed? Have your inheritance or death tax laws changed? These are all questions to consider as your will ages. Changes in federal or state law can directly impact your will. Changes in the law warrant an updated will.

Learning

What have you learned since your last will about your family and how they handle money? Perhaps you’ve learned that your beneficiaries mishandle their own money and tend to overspend. Or maybe they’ve gotten a big promotion at work and seem too busy to allot time to executing your will. What legal strategies do estate planning attorneys have now that may not have been available or common when you did your last will? Learning new things can warrant needing to update your will or trust.

If it has been some time since you last thought about your will, it’s probably time to consider an update. Life happens, laws change, and the most effective estate plans continue to evolve over time. If you have questions or concerns about your existing will, please feel free to call us at 217-726-9200 or email us at info@edwardsgroupllc.com with your questions. We will be more than happy to help you. If you’d like to learn more about our Dynasty Program, which helps Edwards Group clients make sure their plans are up to date and evolve over time, click here.

Losing a Spouse Changes Everything: 5 Things to Think About

Suddenly, She Was Gone

Recently, I (David) was in the airport, waiting on a flight when a fellow passenger opened up and told me his story.

After being married for over 50 years, he had recently lost his wife. She was having a routine heart procedure and things went wrong. Suddenly, she was gone, totally unexpected.

He said it has really thrown him for a loop. Life is ALL different now. Even his schedule is hard. They always used to go out to eat every Friday night. He does it alone now that she’s gone. They always ran errands on Saturdays and relaxed on Sunday. He still finds himself keeping that same schedule, missing her as he goes along.

Even his relationship with his kids has changed. His wife had always been the more talkative one, and the kids tended to talk more with her. Now with Mom gone, they are all having to learn how to talk to each other more and differently.

“My kids don’t know what to do with me!” he said. One child had a house with a special space just for Mom to use after Dad died. NO ONE had thought about Mom dying first and what would happen if it did.

Planning Ahead

Losing a spouse is a big blow. One you never get over. It can feel overwhelming.

But good planning can ease some of the stress and give your family a road map to follow. It won’t help with the Friday night date nights, but it will bring you peace of mind and help the survivor who, all alone, is faced with important financial decisions.

Here are five things to think about with it comes to effective planning:

  1. If your spouse dies, will you live in the same place or move?
  2. Suppose you are caring for your spouse who is in poor health. What if you’re no longer around? Where will he get the care he needs?
  3. If you handle most of the financial matters, will your spouse be able to take that over, or will she need some help?
  4. Where will the survivor get wise advice? Who will be their sounding board? Do you have trusted relationships with your financial advisor and attorney?
  5. If your spouse dies, how will your income change? Will your pension or social security go down?

We have walked with many families who have planned ahead for their spouse, as well as spouses trying to deal with the current or unexpected loss of a loved one. We know how tough it is. By having a clear picture of the options and the right questions to ask, your plan can protect the surviving spouse and ease the stress after your death.

At our free workshop, “Aging With Confidence: 9 Keys to Wise Planning & Peace of Mind” you’ll learn why planning must include both estate planning (death planning) and LIFE planning, along with the 5 life stages to plan for and which stage you’re in, plus clear next steps to guide your planning. Please give us a call at 217-726-9200 with any questions you may have or to RSVP for an upcoming workshop.

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.

 

 

Don’t be like Prince. Make sure you have a Will.

Sadly, celebrity deaths often provide a good opportunity to review what not to do when it comes to estate planning.

Imagine being worth $300 million and not even having a Will

The recent death of the eccentric singer, Prince, offered another opportunity to see what not to do when it comes to estate planning.

Despite being worth an estimated 300 million dollars, the 57-year-old performer died without so much as a Will.

So, how on earth did that happen? Unfortunately, the greatest threat to an effective estate plan is doing nothing. And that’s what A LOT of people choose to do when it comes to planning. It’s “easier” to do nothing. It’s “easier” to just wait and see. It’s “easier” to think, “I’m young. Nothing is going to happen to me yet.” It’s “easier” to assume things will just work out.

Dying Without a Will is a Nightmare for Your Loved Ones

Assuming things will just work out is really not easier. If you approach your estate plan like Prince, and die without a Will (which is called intestate), then your family will HAVE to go to court (an unpleasant process called probate). Your family will most likely DISAGREE about how things should be handled. Your family will be at the mercy of a stranger, sitting on a bench to make IMPORTANT decisions. Even if your family gets along now, chances are, if you die without an effective plan in place, the process will tear them apart. And if your family already doesn’t get along… well, there is virtually no chance they will ever be able to repair the damage that’s been done.

Don’t do this to your family! Don’t expect them to take care of your affairs after you’re gone. Don’t expect that a judge will make the same decisions you would have made. Don’t expect that everything will just work out. It rarely does. We see it everyday.

You can avoid all this by taking action. And the first step is easy — check out our monthly no-pressure workshops. Our Intro to Edwards Group: Wills & Trusts Orientation is a great, no-risk, first step to take.

Call us at 217-726-9200 to save yourself a spot at an upcoming workshop. They tend to fill up. Take action today. Protect your family.

Estate Planning & Potty Breaks (An Honest to Goodness True Story)

Many people think they know what an estate plan is and what it does. And while you are already an “expert” in estate planning because you know the details of your life better than anyone else, it helps to have a guide who can walk you through the complicated legal aspects of an effective plan.

“Sure. You’re going to the ‘library’.” (wink, wink)

It was the secretary’s second week at the big law firm downtown. Here and there she filled in at the front desk when the receptionist was on break. The law firm took up an entire floor, and one of the young new attorneys (who had been told to make sure the receptionist knew where he was), would frequently stick his head in the reception area and say, “I’ll be in the library if you need me.” After this happened quite a few times, the secretary thought, “The library, huh? Well, I guess you could call it that.”

It was a few more weeks before the secretary found out that the law firm did indeed have a library on the next floor of the building! (This was back in the days when lawyers used books instead of computers for research.) The attorney was truly going to the library, while all the while the secretary thought he was making an awful lot of trips to the ‘library’. You know, the kind many of us have 2.5 of in our houses!

That young attorney was David Edwards when he started at his first big firm in downtown Springfield. Dave and the secretary had a good chuckle about it after they finally realized what she had been thinking. You see, sometimes we don’t even know what we don’t know.

The secretary had never been to the library and no one had ever told her about it. So, of course, she was a little suspicious when that young new attorney kept telling her he was headed to the library.

We find the same goes for estate planning. People have a lot of misinformation about estate planning – what Wills can and can’t do. Who needs a Trust and who doesn’t. There are also a lot of misconceptions that lead to wrong assumptions.

Unfortunately, in estate planning, these wrong assumptions can cost families thousands of dollars. They can also destroy families, and add a lot of extra stress at an already difficult time of grieving.

The stakes are very high in estate planning. That’s why it’s so important to get it right.

Education is foundational to what we do at Edwards Group. One of the things people love most about our staff is they can take the complex topic of estate planning and put it into everyday plain language. And this is exactly what David Edwards does at our current workshop, Aging With Confidence: 9 Keys to Wise Planning & Peace of Mind. At this FREE 1.5-hour workshop you’ll learn why effective planning is critical during every stage of life. You’ll also get a good idea of if our unique approach is a good fit for you and your family.

So, what do you need to do?

Give us a call at 217-726-9200 to save your spot at our upcoming workshop. They tend to fill up fast, so it is best if you RSVP ahead of time.

4 Challenges of Aging Alone

There’s a growing segment of people who are aging without the help of their adult children (either because they don’t have children or because their children live far away). Read on to learn more about the challenges this group faces.

People are living longer than ever before in history. People are having less children. And those children often live out of town or in other states. Because of all these factors, 1 in 4 Americans over the age of 65 are at risk of becoming “elder orphans.”

Many don’t like this term. “I’ve lived just fine on my own nearly all my life!” However, it is a quick and clear way to describe a growing number of people who are getting older without the immediate support of close family. And it is a HUGE challenge – one our firm is seeing more and more often.

4 Challenges of Aging Alone

It used to be that a will was an adequate estate plan for most people, but a will only works after a person’s death. A will cannot help with the challenges that present themselves when a person is in their 70’s and 80’s. And if that person does not have children, or has children halfway across the country, then the challenges of the last two decades of life can make things even harder.

So what are 4 important things to consider if you find yourself in this situation?

1. Who’s gonna be in charge?

Of course, you would like the answer to be yourself, but what happens if you have a stroke, start to experience the signs of dementia or develop cancer? When the time comes (and it will come for the vast majority of people), who will pay your bills for you? Who will help get you to doctor visits or treatments? Who will help you get groceries or cook? Read about choosing good helpers here.

2. Who will even know if you need help?

Oftentimes, we don’t recognize the need for help in our own lives. More often than not, at our firm, it is the adult children who notice that their parents need help. It is nearly impossible to notice a slow decline in your own life without someone else’s perspective.

3. What if you get help from all the wrong places?

Sadly, there are more ways to scam seniors than ever before. Dishonest caregivers have always been able to steal money, change the will, etc. but now there are mail order scams, and tech scams on iPads or via email. It is really hard to know who to trust (read about 7 Types of Helpers to Watch Out For here), which brings us to the next challenge…

4. What if you reject good advice because you don’t know who to trust?

While it is really hard to know who to trust, there are still some really good, honest people out there who are passionate about helping seniors. We work with these types of advisors everyday. They are out there, but if you’re on your own, how will you know if you can trust them?

Aging is not something any of us wants to think about, but by thinking and planning ahead, you can save yourself a lot of grief, stress, dignity and money.

If you are facing the prospect of aging alone and are concerned that you don’t have an adequate plan in place, don’t hesitate to give us a call at 217-726-9200. We are always happy to help in anyway that we can!

checkbook

The Checkbook Test: Can your executor or trustee pass it?

Good “helpers” are essential to an effective plan. Could the people you’ve chosen as executor, trustee, power of attorney or guardian pass this simple test?

Every Estate Plan Needs a Good Helper

We talk about good “helpers” a lot, and that’s because they are vitally important to an effective estate plan. Helpers are the people who will carry out your plan when the time comes. They can be known by different names depending on which document names them as a helper. Some helpers are trustees for trusts, some are executors for wills, some are power of attorney for health or finances, and some helpers are guardians for minor children. No matter the title, their job is essentially the same – to make good choices and to act for you when you cannot do it for yourself. (Read more about choosing good helpers here.)

The Checkbook Test

There is a very simple way to gauge whether you have chosen the right person to be one of your “helpers.”

Imagine the person you have chosen (or are considering choosing) as your executor or trustee. Now, imagine giving them your checkbook and letting them pay your bills for a couple months. How does that make you feel? Do you feel nervous? Anxious? If so, you may want to reconsider who you’ve chosen as a helper. 

Read about 7 Types of Helpers to Watch Out For here.

So, how can Edwards Group help?

If you’ve been around Edwards Group for any amount of time, we hope that you’ve seen how we approach estate planning differently. One of the things we do differently is by counseling our clients as they make the hard decisions that have to be made when creating an estate plan. We have experience that most people don’t. We do estate planning all day every day, and we’ve done it for nearly a decade now. We can help guide our clients through these hard choices.

If you need help choosing “helpers” for your plan, call us at 217-726-9200 and ask for a copy of our paper newsletter on choosing helpers. We’ll be more than happy to mail you a copy. You can get immediate access to this great resource here.

Download our resource on choosing good helpers HERE.