death parent

Case Study: When a Young Mother Suddenly Dies

The Brock’s were just an average young family in the 1980’s. The father, Robert, had been to Vietnam and back a decade earlier. The mother, Margaret, stayed at home with their two young boys, James and Steven. The family lived in a modest ranch house in middle America. But one day their normal life unexpectedly came to an end when the complications of a routine surgery left Margaret in a coma. Her sons were only 8 and 6 at the time.

The Death of a Loved One is Never Normal

Without health insurance or life insurance, Robert faced a very difficult situation as his wife lay in a coma. Margaret didn’t have any written health directives. Only Robert knew that Margaret didn’t want to be kept alive through artificial measures. After less than a week, Robert made the agonizing decision to remove Margaret from life support. Margaret’s parents and sister disagreed with how quickly he made the decision, which made a tragic situation even worse.

Margaret’s parents continued to be a part of their grandsons’ lives. They tried to make peace with her husband’s decision. But Margaret’s sister never forgave Robert. Margaret’s sister also lumped James and Steven in with her anger towards Robert. Instead of being a link to their missing mother and helpful part of the grieving process, she severed the relationship. The boys had not only lost a mother. They had now lost an aunt, an uncle and their cousins as well. Potentially powerful relationships in the healing process were gone.

Having already made the most difficult decision of his life, Robert Brock continued to face the harsh reality of life after his wife’s death. The bills from his wife’s surgery, hospital stay, and death piled up. However, Robert couldn’t sell the house to relieve some of that burden. Without a will, part of the house now belonged to the two boys and could not be sold until the boys were of legal age. Robert was forced to take on extra accounting work at night for a local small business. The boys would go with him after school and be expected to occupy themselves while their father worked an extra 5 nights a week.

A Cautionary Tale: What They Wish Could Be Different

Following the example set by his father, the youngest son, James, never dwelt on what happened or what could have been. He simply continued on with life. Now an adult himself, sometimes James wishes his father had handled things differently. For example, his father never told the boys the exact date of their mother’s death. James is still unsure of the date two decades later. For the most part, though, Robert and his boys chose not to let this tragic event define them in a negative way.

There are also times when James misses having motherly advice, but what he misses the most are the stories that define a lifetime. The story of his birth, stories from childhood, and stories from his mother’s life — all of those died with his mother (and when his aunt walked out of their life). Other than a few photographs, he has nothing left of her. His father’s way of dealing with the overwhelming sadness of the situation was to get rid of everything and sweep it under the rug. While Robert may have thought this was best for him and his boys, it left a big hole in their life.

What Good Is a Plan During a Tragedy?

An estate plan cannot erase the grief for the family left behind when a loved one dies, but it can ease the transition and facilitate healing. Here are some tools that families can use to help make things easier during the devastating and sudden loss of a loved one:

  1. Legal documents clearly stating end of life issues can ease the burden on a spouse who is faced with an agonizing decision like the one above. These documents also could have given other family members peace of mind knowing that their sister/daughter’s wishes were being carried out. In the end, this could have preserved important family relationships for those left behind in the distressing wake of loss.
  2. Preserving memories or special items that lay a foundation for adulthood can mean a lot to the children left behind, but preserving the stories behind those items through letters or audio recordings would have been priceless.
  3. Life insurance could have eased the daily financial stress of losing a spouse and raising children alone.

The death of a spouse or parent is never easy, but there are many things that can make sudden and devastating events, like the one above, a little easier for those left to live life without a very special loved one.

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 estate planning, take a look at our upcoming workshop, Wills & Trusts: How to Get Started. At this 1-hour workshop you’ll learn if a Will or Trust is right for you, the clear step-by-step process for getting organized and planning, and if Edwards Group is a good fit for you.

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.

 

 

I just ate a cheeseburger.

At this point in the year, many of us are abandoning our New Year’s resolutions, but there’s still hope…

by Chris Flynn, Attorney

Well, we’re a few months into 2016, which means we’re also past the point where many people have abandoned their New Year’s resolutions. (I’ve started eating cheeseburgers again despite the 15 or 25 pounds I’d planned to lose this year.)

Estate Plan Organization

A common resolution in the beginning of the year is to “get organized.” I have file cabinets at home that I’ve been mindlessly throwing documents into for years. I keep meaning to clean them out. I know they hold important papers, but can’t imagine trying to actually locate any one of them. With no immediate need to know where specific paperwork is, it’s always easy to put it off for another day instead of taking a couple hours to make sure the big things are in place.

And sadly, if I never do take care of those file cabinets? My family will be left to dig through the piles of junk I’ve gathered over the years trying to figure out what’s important and what’s been left for them.

Would it help your children to know where stuff it? To easily know what bank accounts, investment accounts and insurance policies you own? To get things handled quickly and privately and as automatically as possible when you die?

We can help with this! In just a few meetings, you can know what you have, where your accounts are, where your assets are going when you die, and have it all in one place so that you or your loved ones can access it whenever it’s neededBig Red Binder web version

When you set up a trust with Edwards Group LLC, you’ll leave with The Red Binder. In it, we’ll have all the documents needed to ensure easy administration of your accounts and assets during your disability or after your death.

The Red Binder

Some of the contents of The Red Binder include:

• A Trust, stating what happens with all of your assets upon your disability or death.

• A Will, ensuring that any “straggling” assets get handled in accordance with your trust.

• Powers of Attorney, ensuring that the right people (of your choosing) have the ability to help you when you need it.

• End-of-life and burial wishes, so your family knows what you want and can avoid disputing it later.

• A summary of your plan and a summary of your assets.

In our office, Senior Asset Coordinator Laura Peffley (pictured above with clients), is constantly helping clients get their assets consolidated into one trust. If you simply have an account statement or can print one, she can usually work with that. If you can’t find a deed to your house, she can help you track it down. And ultimately, we can map out a plan together to ensure all of your assets go where you want, when you want.

Procrastination is the Enemy of Estate Plans

Even if you’ve already abandoned some of your resolutions at this point in the year, we can still help you tackle this one today. Procrastination is the single greatest threat to an effective estate plan. Don’t put it off any longer. Planning protects those things most important to you, and we make it easy to take the first step with the following options:

  1. Attend one of our free workshops. We have two regular workshops, one of which is an introduction to estate planning. It’s a great, no-pressure way to get started. And you’ll receive $200 off your Initial Meeting fee just for attending.
  2. Give us a call at 217-726-9200. Tarina, our Client Coordinator, loves helping people and answering their questions. In fact, she was a client before she ever started working at Edwards Group, so she has a unique perspective that many find helpful.
  3. Schedule an Initial Meeting. If you know you’re ready to get started and want to stop putting it off any longer, just give us a call to schedule a 45-minute meeting where an attorney will review your concerns and goals. The attorney will also help you understand the unique risks that your family faces. By the end of the meeting, you should understand your planning options, what they will cost and if Edwards Group is the right firm for you. Clients find this meeting to be very valuable in helping them understand their options.

Get back on board with getting organized by calling us at 217-726-9200 to RSVP for a workshop, ask questions or schedule an Initial Meeting.

lottery ticket

How NOT Winning the Lottery Makes Your Life Easier

Big changes in your life may require updates in your estate plan. What kind of big changes? And what should you do about it?

by Attorney Chris Flynn

I didn’t win the Powerball, either…

And that’s okay. Can you imagine how much life changes after something like that? The good news is, since I didn’t win the largest jackpot in US history, the things I’m doing now, and the planning I’ve done for later, don’t have to change at all. I’ve worked with several clients recently though, who have gone through big changes in their life, some of whom have received an inheritance (typically less than the recent $1.5 billion jackpot), bought a new house, had a loved one get married, or become disabled.

Any of these types of changes in your life could mean that you need to update your estate plan.

We frequently help clients update their plan after big life changes. By updating your plan periodically, you ensure that:

• any new money or wealth will go where it needs to go instead of being eaten up by things like nursing home costs or taxes.

• any planning you did based on your prior home is also done for your new (or second) home.

• your child’s inheritance can be protected in a trust where things like future divorces, long-term care costs or creditors cannot “steal” it away.

While we often help clients who already have done planning elsewhere to update their plans, our Dynasty program has proven to be a simple and cost-effective way to make sure our clients’ plans are always up-to-date. Through this program, we follow up with our clients regularly to confirm that their plan is up to date with the law, but also that their plans capture any changes that have occurred in life, health or assets.

Even more important than updating your current plan, is making sure you have a plan in the first place. Our Intro to Edwards Group: Wills & Trusts Orientation is a perfect way to get started if you don’t have a plan (or if your plan is quite old – read about the risks of an old will here). Give us a call at 217-726-9200 and RSVP for one of our upcoming educational workshops. By attending a workshop, you’ll receive $200 off your initial meeting fee (if you schedule your appointment within 30 days of the workshop). We do this so you’ll know, before spending your hard-earned money, if we’re the right firm for you. Attending a workshop makes the planning process easier and more effective.

The greatest threat to an effective estate plan is not taking any action at all, so take a step today and call us t 217-726-9200.

Take Action Now: Update Your Beneficiary Designations

It is vitally important that you review all your beneficiary designations (life insurance, 401(k)s, etc.) every 2 years, or sooner in cases of births, deaths, marriages, divorce, job changes or retirement. Read on to see real court cases that show why it is so crucial.

We talk about beneficiaries A LOT around here, and the following court cases will show some of the reasons why, but first, let’s review what a beneficiary is and why it’s so important.

There are a few financial planning tools that are not passed down in wills. Things like life insurance and 401(k)s are passed down to whomever you write on the beneficiary designation form when you sign up for them. And sadly, many people NEVER change those names ever again despite the changes in their life circumstances. There are a significant number of people who take the time to care for their loved ones by taking out life insurance policies, but then don’t pay attention to who really owns it or who the beneficiary is. The tragic consequences of this oversight, impact those they love most.

Life is not a fairytale. Things do not automatically work out for the best. The law is the law, and therefore, will not be swayed by what seems reasonable for your family. These two federal cases illustrate that:

In Hearing v. Minnesota Life Insurance Company, a single father named his sister as beneficiary of his life insurance policy so the sister could take care of the daughter. He intended to change the beneficiary to his daughter once she turned 18. But he never got around to it. Sadly, the father died and the sister claimed the life insurance. Despite a handwritten note stating that he wanted his daughter to be the new beneficiary, the court found that the only thing that mattered was the name on the beneficiary designation. The sister, not the daughter, got the $100,000 pay out.

Again, in The Lincoln National Life Insurance Company v. Ruybal case, we have another “sister” situation. A single dad named his sister beneficiary because she was supposed to take care of the kids. Upon death, the decedent’s sister, his executor, and the two daughters all claimed the life insurance. The court ruled in favor of the sister, noting that, “Anyone attacking the right of a named beneficiary to receive the proceeds of an insurance policy has the burden of proving that the beneficiary is not entitled thereto.” In other words, the sister was on the form – plain and simple. Would it have been more fair for the estate or the daughters to get the money from the policy? Probably. But it is not the duty of the courts to do the reasonable thing. It is their duty to uphold and interpret the law. It is your duty to keep up to date with your beneficiary designations.

As you can see in each of these real-live cases, the court ordered payment to the named beneficiary, even to the detriment of the children of the deceased.  The clear message from the courts in these decisions is that the named beneficiary of a life insurance policy will get the death proceeds regardless of what other competing claims exist, or what one’s sense of fairness seems to dictate.

This means the burden is yours to keep up with your beneficiary designations. It is vitally important to make sure they are up to date. At the very least, you should review your beneficiary designations every 2 years. But in the case of the following life events, you should review your beneficiary designations right away:

  • Family events such as births, deaths, marriages and divorces all should trigger a review of ALL beneficiary designations.
  • Work events such as changes in business, change of job or retirement ALL should trigger reviews.
  • External events such as significant tax changes or other legal changes should also trigger a review.

Some mistakes are just not fixable. Please, double check your beneficiary designations if you have not done so recently. Edwards Group clients can rest easy because we help make sure assets are set up properly (and stay that way through our Dynasty Membership program). Join us for an introductory workshop to hear more about how we can help with estate planning.

david edwards estate planning elder law

Long-term Care Planning and Why It Matters: 6 Goals of Planning

I know from experience that everyone who comes into our office has goals and expectations that they bring along with them. But did you know that we have goals for each of our clients as well?

Some people see long-term care planning as a shady way to get around having to pay for care as one ages. I can assure you that nothing we do when it comes to long-term care planning is shady. We truly care about helping people during one of the most difficult times in their life.

Here are 6 goals we have for every client who comes through the door and needs help with long-term care planning:

  1. Make sure they get good care when it’s needed. Aging in America is expensive, and we’ve all heard horror stories about nursing homes. (Or, sadly, experienced them firsthand with aging grandparents or parents.) Nobody wants to be neglected or mistreated as they age. By planning ahead, we can help make sure that the best possible care is available when the time comes.
  2. Make sure the right people are in charge. As one ages, there may come a time when someone else will need to make financial and medical decisions (because of stroke or dementia). We help our clients think through who might be best for that role. Read more about how to choose good helpers here.
  3. Maximize legally available benefits such as VA and MedicaidIt never ceases to amaze me how many people do not realize they are eligible for benefits, either from serving in the military (or being married to someone who served) or by paying taxes most of their life. Because we do this everyday, we know what help is out there. Long-term care is outrageously expensive. Maximizing available benefits is a must.
  4. Get the benefits as quickly as possible. We often help clients get benefits quicker than they otherwise would without us. With good Medicaid planning, we can protect assets and start nursing home benefits months or even years quicker than without planning. With the VA, our clients often get approvals in weeks, whereas some families trying it alone are stuck months or even years in endless bureaucracy. Quicker benefit approval means thousands of dollars more that will be available to pay for care.
  5. Protect assets if we can. Under Medicaid guidelines, a person is only allowed to keep $1 per day! That is not enough for extras that your loved one, or you, might need as you age. By protecting assets, we can make sure there is money for extras that otherwise couldn’t be afforded.
  6. Make things easier on your family or power of attorney. Dealing with a sick or aging loved one is incredibly stressful. We see it everyday. But families don’t need to go it alone. There are many things we can do to help ease the burden so your loved ones can enjoy their final years with you instead of having to stress about how to find care, how to pay for care, etc.

To read more about long-term care planning, check out this article: 8 Keys to Effective Long Term Planning. In addition, you may want to consider attending our next workshop, “How to Protect Your House and Life Savings from the Nursing Home.”

bad heir day

A Bad Heir Day: When Beneficiary Designations Trump Your Will

Download our Beneficiary Designations Form Now

Many people incorrectly assume that all their assets will be distributed through their will. Unfortunately, this is a big misconception. A good example of this is retirement savings, such as an IRA or 401(k). These accounts are passed on to the person or persons who were designated on the form when the account was started. Many people don’t give much thought to these forms, especially after they first fill them out, but that can cause huge problems down the road. (Read about how such a mistake cost the adult children of Leonard Smith $400,000.)

Just recently, here at Edwards Group, we had this sort of situation arise as well. A client had an old 401(k) from a previous job in which his parents were named as beneficiaries. Unfortunately, they had passed away so the 401(k) had no beneficiaries listed. When the client died, we had to go through the expensive process of probate court to get the 401(k) into the hands of the right people.

Improper beneficiary designations can also jeopardize nursing home care if Medicaid is paying for that care. Recently we had a case where the spouse of someone in nursing care died leaving money to the disabled spouse instead of their adult children. This large amount of money is now jeopardizing the surviving spouse’s benefits.

I cannot emphasize enough how important these beneficiary designations are! It is not enough to just fill out the form once and then leave them be. It is vitally important that you check these designations yearly as a part of the regular upkeep of your plan. (Download our Beneficiary Designations form here.)

So, what types of assets with beneficiary designations trump a Will?

  • Life insurance polices
  • Annuities
  • Retirement accounts such as 401 (k)s and IRAs
  • Bank accounts with a payable on death provision
  • Investment accounts with a transfer on death provision

And what kind of life changes should trigger a review of beneficiary designations? After the following life changes, you need to double check who you put on your beneficiary designation forms:

  • Marriage
  • Divorce
  • Births
  • Deaths
  • Job changes, including retirement
  • Long-term care needs of one spouse
  • Disability of a child or grandchild

Now, here’s what to do to make sure this doesn’t make a mess for you or your family:

Make a list of all retirement accounts, life insurance policies, annuities and investment accounts. To the right of those specific assets, write who the beneficiary is and the date you last designated them. Review this list once a year (like on April 15). Or join the Dynasty program where we help you keep up with all of this. We’ve also included a PDF you can download to help make the process easier.

This whole issue highlights why Laura and Liis are so important to the clients at Edwards Group. Many of you may wonder why we need two Asset Coordinators, but it is a big job and it is a critically important job. One of the biggest mistakes people (and even other attorneys) make is not properly handling assets within an estate plan. You cannot have an effective plan if the assets have not been properly titled, designated and coordinated.

As always, if you have any questions about beneficiary designations or any other estate planning or elder law issues, please call us at 217-726-9200. We will be happy to speak with you and answer any questions we can.

Save Your Family Extra Anguish After You Die: Prepare a Will

Tarina, our Client Coordinator, hears it all the time, “I wish I hadn’t put off planning for so long. I just feel so much better now that we have a plan in place.”

Do you want to make things easier on your family?  Or more difficult?  Good planning will spare your family stress, conflict, and expense later.  I will never forget this article from Today.com by reporter Sharon Epperson where she talked about her father passing away and what his planning meant for her and her sisters, “By making some important decisions while living, my father helped to lessen the overwhelming stress of coping with [his] sudden loss.”

Sadly, loved ones left behind bear the burden of lack of planning.

So, what happens when you die without an effective plan or even a will?

In the US courts, if someone dies without a will it is called intestate, which basically means the state will decide what to do with any assets. There will be a lot of paperwork, court appearances, etc.

One of the most difficult things is making a list of all assets and debts. Since these types of things are not typically discussed freely, this can be a real headache for your loved ones left behind. During a time of grief they have to play detective trying to hunt down what you may own or owe.

There are also many assets that aren’t determined by a will. For these type of assets your loved ones will have to gather the necessary paperwork to prove whom the beneficiary or new owner is. Assets that aren’t passed down by will are:

  • Life insurance proceeds
  • Jointly owned assets, such as real estate or bank accounts
  • Property held in a living trust
  • Funds in IRAs, 401(k)s, or other retirement accounts
  • Payable-on-death bank accounts
  • Residential real estate with a “Transfer on Death Instrument” recorded with the county

We know there are a lot of reasons people don’t plan. Tarina says a lot people admit (after planning) that they were really intimidated by the process or didn’t feel they knew Dave well enough, but none of them regret finally taking the leap and planning. At Edwards Group we’ve worked really hard to make the process as painless and effective as possible. We also offer a money-back guarantee. Now, what attorney do you know of who does that?

If you’re ready to stop gambling on what will transpire if the unthinkable happens, here are the next steps to take:

1) 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.

2) If, after attending a workshop, you would like to take the next step, you will receive $200 off your initial meeting fee, and you can read more about that process here.

3) 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, trust, 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 go through the consequences of bad planning. Take a step in the right direction today by attending a workshop, giving us a call at 217-726-9200, or signing up for our weekly email newsletter.

6 Estate Planning Pitfalls to Avoid

1. Your plan is not personalized. You may have a Last Will & Testament or even a trust, but do you know what it does? Do you feel like it fits you well? Or are there some things about it that you wish you could change? Some people end up with fill-in-the-blank forms that do not reflect their families, their values, goals or concerns. You need a plan that fits your goals.  Are you comfortable with your existing plan?

2. Disorganized assets. You may have a great Will or trust, but how you own assets or what your beneficiary designations say could undo what your Will or trust says. Assets can be owned many different ways (individually, jointly, in a corporation, LLC, trust), while beneficiary designations cover your IRA, 401(k), life insurance, and annuities. We need to make sure your Will or trust fit together with your asset instructions like puzzle pieces. For instance, no assets are governed by your trust unless the asset is transferred to the trust. And a beneficiary designation will rule first over what your Will says about an asset (just ask plenty of ex-wives out there who got surprise life insurance when their ex-husbands died!) How will you make sure your assets fit with your planning? What are some beneficiary designations you need to check and/or update?

3. Your plan is not up to date. How old is your plan? 10, 15, 20 years old? Some people signed an old dusty Will many years ago and have not looked at it since. But their lives have changed in many ways since they signed it. Life is always changing. Our assets go up (or down), we retire, get married, divorced, have grandkids, move, remarry, loved ones pass away. All those things affect your plan. When your plan does not adjust to your life changes, you are left with a mess later. What life changes have occurred since you last updated your plan?

4. After death legal fees spiral out of control. Do you know that many lawyers over the years have made more money cleaning up messy estates after death than they do planning the estates? It’s the dirty little secret of estate attorneys. Don’t just assume “it will all work out fine after I’m gone.” A cheap Will now may lead to expensive court battles later. But a good plan now, where you invest your time, energy (and yes your money) is the best way to reduce expenses at your death. A good plan will avoid probate court, avoid family battles, and reduce the legal fees needed.

5. Your family is not prepared for the plan. When the time comes for your plan to start working (upon your disability or death) will your family know who to call and what to do? Will the people you’ve chosen to be your “helpers” do their job well? Or will their personality result in procrastination, extra stress or conflict among siblings? Who are your helpers, and have you talked with them about it? Bad estate plans break up good families.

6. Your plan leaves your family open to ongoing risks. A good estate plan has two parts. First, smooth transfer of assets (avoiding probate, taxes, family fights). Second, protecting what you leave behind. If you leave an inheritance to your son, what if he later gets divorced or sued? Will your hard earned money end up with an ex-spouse or a creditor? Good planning can protect against that risk and many others, such as nursing home costs during your life, kids who spend too much, disability benefits, many more. Are there any potential risks you can anticipate?