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Forget About The “Estate” And Just Do Planning

Estate Planning isn’t just for people with estates…

I talk a lot about “estate planning,” whatever that means. It sounds like lawyer talk and often makes people’s eyes glaze over. Well, I want you to forget about the estate and just call it planning, because that’s all it is!

It’s planning…

• for getting older and making choices for your own care.
• on how you will pay for a nursing home, if it comes to that.
• for what will happen to those family heirlooms.
• for what will happen when you’re gone. (Would your family know what to do or who to turn to?)
• for your kids so they’ll be ready to inherit whatever you might leave them.

Everyday we help our clients use legal and financial solutions to plan for the people they care about and the stuff they own. Don’t let the terminology scare you away. We’ve worked hard to make planning as easy as possible.

The best first step is free and only takes an hour — attend our introductory workshop, Wills & Trusts: How to Get Started.  Click here to see when it’s offered next.

This workshop is a great way to get started on planning. You’ll learn about the basics of planning, how our innovative process protects your family and how we guide you through each step in the process.

Give us a call at 217-726-9200 and save yourself a spot today!

The Myth of a “Simple” Will

“I just want a simple will.”

We hear this a lot. The people who say it generally assume they have a “regular” family with straightforward assets. They don’t want to pay a lot for elaborate documents they don’t understand. They just want a last will and testament. We get that!

In reality, “simple” wills often backfire and cost families more money and stress in the long run.

Every family has unique circumstances that can cause challenges and heartaches. And “simple” wills can’t effectively deal with these challenges.

An effective will and estate plan is really for the loved ones you leave behind. It’s your final gift to them — and it can go smoothly via effective planning ahead of time, or it can be a huge mess that tears families apart. We see it all the time.

Bad estate plans destroy good families.

The bottom line — the cost of a “simple” will is more than most people realize. We see it when we help families deal with the aftermath of an ineffective plan their loved one left behind.

Our process for creating an effective plan is thorough. We use your expertise about your own family to help anticipate future problems. We then use our expertise to address those problems using the tools in our legal toolbox.

We get to know your family, if that’s what you’d like, so when the time comes, they will already be familiar with our team and our office. We help our clients plan for the unexpected, so when the unexpected happens, things can still go smoothly for their loved ones.

It’s hard to put a price on that kind of peace of mind.

But that doesn’t mean we charge you exorbitant hourly fees. The pricing structure at our firm is fairly unique. When David Edwards started the firm in 2008, he wanted everything to be designed around helping clients plan better and have more peace of mind. This included how he decided to charge fees. So, clients who work with us can be assured there are no surprises when it comes to that.

We charge flat fees that are agreed upon ahead of time. Read more about that here.

We are passionate about the fact that every family deserves an effective estate plan that can make one of life’s hardest transitions a little easier.

We believe that family legacy is important and that everything you’ve worked so hard for should be protected and passed down to the next generation as you wish.

If the desire for a “simple” will doesn’t quite sit right with you, or the fear of an expensive and complicated plan is keeping you from taking the first step in protecting your family, we encourage you to attend our next Wills & Trusts: How to Get Started workshop. At this 1.5-hour workshop you’ll learn:

  • 6 common pitfalls of planning
  • which of these pitfalls are a risk to you and your family
  • what you need to do to make sure you don’t leave a mess for your loved ones
  • how our pricing structure works

After attending this workshop, if you decide to work with us, you’ll receive $200 off your Initial Meeting fee.

If you’ve been putting off planning, we encourage you to take the first step and call 217-726-9200 to RSVP for the workshop. Your path to peace of mind starts here.

 

Dangers of a Do-It-Yourself POA

Completing a Power of Attorney document is one of the most impactful things you can do to lessen the burden of caregiving on your family and loved ones. Power of Attorney documents are not crafted as “one size fits all” but instead are customized to reflect the varying needs of each individual family situation. 

Investing in an attorney to help you draft your POA document can help you better understand the terms of the document and minimize mistakes. Answering one question incorrectly on your POA document can lead to many problems in the future — problems that can be costly and emotionally taxing for you and your loved ones.

There are 3 dangers of doing a POA on your own that we’d like to briefly look at:

1. Too Many Powers – One problem with creating a POA document yourself is the possibility of giving your power of attorney too much power. While the form looks relatively simply, it is easy to answer a question incorrectly without a lawyer’s expertise and guidance. You could give your POA agent too many powers and open the gateway to elder abuse. Whenever you see a newspaper article about an older person being taken advantage of, it’s often the result of abusing a power of attorney.

Powers of attorney can be easily abused because they are not monitored by the legal system. Templates are easily available online and anyone can serve as a witness or notary, even if they don’t have your best interests in mind. Paying for the legal expertise is worth the security that comes from knowing your POA agent has the correct powers. Attorneys are ethically sworn to serve the best interests of their clients and can help you avoid elder abuse by assisting you in selecting a trustworthy power of attorney agent. Nominating a power of attorney (when done correctly) should give you peace of mind, not make you nervous.

2. Too Few Powers – Sometimes a person has a POA agent who is 100% trustworthy, but their powers listed in the document are so limited that they are unable to do the things that would be best. We have seen a number of families who were working on long-term care planning, hoping to seek benefits to pay for nursing home care. However, their power of attorney did not include certain powers that would have been helpful in that situation. For instance, unless we specifically state them, a power of attorney does not include the power to create a trust (which is a valuable tool often used for effective planning), or the power to make gifts to family. Yet, creating trusts and making gifts are often important parts of protecting money from a nursing home towards the end of life.

3. Not The Form You Need – If a power of attorney document is created without a lawyer, there is no guarantee that all banks or institutions will accept it. There have been a couple of law changes in Illinois in the last few years regarding powers of attorney. If you find an online document, is it the correct and most up to date form? If not, the bank may refuse to honor it, and they are within their rights to do so if it is not in the proper format.

As with so many things related to estate planning, every family and every situation create unique circumstances that fill-in-the-blank forms cannot adequately address. It is incredibly valuable to the have the help of an experienced estate planning or elder law attorney to help guide you through the process while anticipating problems your unique situation may bring up. If you have questions about Powers of Attorney or any other estate planning/elder law issues, we urge you to give us a call at 217-726-9200. We’re more than happy to speak with you.

Halloween 2017

We ask clients to trust us with a lot of very personal information. As such, we tend to treat them like family and share our lives with them. Our annual Halloween costume pictures continue to be a big hit year after year.

Here are the children of Edwards Group dressed up for Halloween 2017:

Liis Casey’s son helped pass out candy this year!

Amanda Lundeen’s boys — two dressed from Moana and two from Pokemon.

David Edwards’ kids dressed as a cowboy and a turtle.

Laura Peffley’s grandchildren ready to trick-or-treat.

Tarina’s son continued with the Beatles theme this year and dressed as John Lennon.

Sandy Eisenmann’s boys were too big to dress up this year, so she chose to go back in time. Ten years to be exact.

7 Questions to Ask Before the Age of 70

People are living longer than ever these days, and while that is a good thing, it definitely presents challenges. Regardless of you or your loved one’s stage in life, good planning requires that you ask good questions. And asking good questions can sometimes be uncomfortable, unpleasant or overwhelming. We have come up with 7 questions that need to be asked by the time someone turns 70. If you address these 7 things, it will make aging easier on you and your family.

A little discomfort now can make ALL the difference later. One of the keys to this exercise is not taking an emotional approach. We naturally think of ourselves as 15 years younger than we really are. That means when we turn 70, we actually still feel like we’re 55! That’s a big difference. One way to combat this is to look at the cold, hard facts about aging:

  • People reaching the age of 65 will live, on average, 19.2 more years. That’s 84, if you don’t want to do the math.
  • 36% of people aged 65+ reported some sort of disability in 2012. (That’s 1 out of every 3 people.) Limitations in daily living activities because of chronic conditions will only increase with age.
  • Statistics vary, but it is generally thought that 70-80% of people who reach 65 will need some sort of care during the rest of their life!
  • 1 in 3 older women are widows. And according to the Wall Street Journal, 86% of widows live in poverty. Almost half of women 75+ live alone.
  • And according to David Laibson, who specializes in behavioral finance at Harvard University, about half the 80-year-old population is not in a position to make important financial decisions due to rates of dementia and other kinds of cognitive impairment. This means it’s important to make these decisions sooner rather than later.

So, what are the questions we want you to think about and ask yourself?

  1. Who’s in charge here? Every plan for aging needs a good helper. (Think Power of Attorney, executor or trustee.)
  2. Do you have the correct powers in place? If you have a Power of Attorney, does it have the correct provisions to allow the most flexible planning options as you age?
  3. Is your estate plan up to date? Lives constantly change, which means your estate plan needs to be tweaked to match the circumstances.
  4. What care will be needed… and when? This is a great question, without a concrete answer, but it’s important to be realistic and anticipate the possibilities.
  5. Have you explored ALL the asset protection options? Even before care is needed, there are some important steps that can be taken to help pay for care when it is eventually needed.
  6. Are you maximizing available benefits now? If care is needed now, are you sure that you are accessing all available help, like VA and Medicaid?
  7. The best way to answer Question #6 is by answering Question #7: Have you gotten the advice of an experienced elder law attorney? Experienced elder law attorneys deal with these issues everyday, which means they are always up on the latest laws, benefits and local care options.

One final encouragement from Dave on this topic, “It is far easier to have a plan pre-70 and tweak it here and there as the situation changes, rather than having to make all the big decisions during a crisis or once decision-making impairment has begun.” Addressing all 7 of these questions is something that all of our plans do. If answering these questions feels overwhelming, don’t stress! We guide our clients through the decision-making process everyday. And when the time comes to start implementing the plan, we work as a support for your family, making sure that things go as smoothly as possible. Give us a call at 217-726-9200 if you have questions, or check out one of our upcoming workshops.

siblings equal

6 Reasons You Shouldn’t Treat Your Kids Equally

We have a common saying with our kids, “Fair doesn’t mean equal.”

Many of us want equality to be synonymous with fairness — maybe because it seems easier to make things equal than to navigate the complexity of fairness. But think about raising kids. Did you make sure everything was equal?

I doubt you kept track of each dollar spent to make sure it was the same for each child. One child may need braces, while the other has straight teeth. One may need money for music and sports, while the other doesn’t have an interest in those types of things. One child could have health issues and another doesn’t. One could need help with college, while another gets a scholarship. We provide our kids with what is appropriate and what we think they need, regardless of whether it is equal.

And the same should be true of your estate plan. Sometimes, it is okay to treat your children “unequally” because this really may be the fairest approach.

Here are six instances in which you might not want to treat your kids equally when it comes to your plan:

  1. Greater financial need. One of your kids may need more help financially. Kids are not equal in terms of their financial success or ability to succeed in a career. One of them may simply need more than others because of their financial situation.
  2. Health needs. A child (or even a grandchild) may have health needs that result in increased costs. Health issues can also limit one’s work options or earning potential, therefore making their need for financial assistance greater.
  3. One may not need it. For instance, if a disabled child already has their basic needs taken care of through government benefits and healthcare, then it could make things harder for that child to receive money from your estate. If you are confident that siblings will help provide for any extras this person may have in the future, you may be able to disinherit that child without affecting their quality of life.
  4. Some are better stewards. If one child has consistently made bad financial choices, and you have repeatedly bailed them out, it might make sense to leave them less because you are not confident they would use it well. Or, if you do decide to leave them a similar amount, you may want to take steps to protect their inheritance with specific rules, and someone to help manage it for them. (But not a sibling!)
  5. Early inheritance. Quite often adult children have a significant financial need and parents give them substantial help. After this happens, it might be good to consider adjusting the amount that child would receive in an inheritance. When this situation occurs, without adjusting the amount left in the estate, the child who didn’t need help often feels they are being punished for never needing help.
  6. Family farm or business. One child may rely on the family farm or business for their livelihood. If one child has spent a lifetime helping you grow your farm or business, it may be best to leave them more of the total estate so their livelihood is not negatively affected.

Some people still can’t get over the “unfairness” of leaving “unequal” amounts to their children. If you decide to leave equal amounts to each child, we encourage you to consider leaving specially tailored rules for each child, so the inheritance can be handled more fairly.

Protecting Our Kids From Threats

Another important part of an effective estate plan is helping protect our kids from threats. Whether it’s their own wild spending, a future divorce, a lawsuit or financial problems, an effective plan can help anticipate and mitigate these types of challenges. Some kids are more exposed to threats than others. Some kids are better able to handle money than others. The rules you create for your plan need to reflect that. As a parent you should feel free to handle things how you think best, without being tied by guilt into making everything exactly equal.

Involve Your Kids in the Planning Process

We often encourage our clients to involve their family in the planning process. This is especially important when considering leaving “unequal” inheritances. Effective communication with your family about why you have decided to do things the way you have can eliminate a legacy of misunderstanding, misinterpretation of your actions, and pain that children experience when parents don’t communicate about the plan ahead of time.

We have seen many adult children upset by their interpretation of their parents’ plan when the parents leave behind no explanation for their rationale, or fail to discuss ahead of time why they’ve chosen to do what they have. Estate plans can seem like a final accounting of a parent’s love. Because of this, it is really important to do the hard work of communicating with your family, either ahead of time or through your plan.

As with many estate planning matters, this is a complicated one with best solutions varying from family to family. We can’t possibly cover all the nuances in one blog post. Our process walks families through difficult decisions like whether to leave equal amounts to your children in your plan. You have the knowledge about your unique family. We are the experienced guide that helps create an effective plan based on that knowledge. If we can be of assistance to your family, please give us a call at 217-726-9200. If you’d like to learn more about creating an effective estate plan, we encourage you to attend our next introductory workshop, Wills & Trusts: How to Get Started. It’s a great first step towards peace of mind and protecting those you love.

Don’t Get Stuck With a Stupid Tax

Have you ever heard the phrase, “stupid tax”? I hate paying a stupid tax, because it’s always something that could have been avoided.

A few years ago my wife and I went with my parents to see an Illini basketball game in Champaign. After eating at the Ribeye on Neil Street (good food!), I ran through the snow to get the car. As I approached the car I had a sinking feeling.

I had forgotten the tickets. 

Thankfully, the box office was able to reissue forgotten season tickets, but I had to pay a stupid tax of $5 for every ticket being replaced!

We all get stuck paying a stupid tax every now and then. A few dollars isn’t bad as far as a stupid tax is concerned, but when it comes to estate planning, mistakes can be very costly. One of my primary goals is to help you and your family avoid paying any stupid taxes by thoroughly thinking through things and planning ahead.

Recently, a younger high profile celebrity died without thinking through what would happen to his estate if he suddenly passed away. His estate ended up paying a $12 million stupid tax. While most people won’t make that big of a mistake when it comes to planning, we see people all the time who did not properly plan, and therefore, end up owing a stupid tax. And the most frustrating part? It could have been avoided.

If you’re not sure whether your estate will be slapped with a stupid tax, we encourage you to give us a call at 217-726-9200 or attend an upcoming workshop on estate planning. Wills & Trusts: How to Get Started is a great way to learn more about effective planning.

nursing home medicaid planning

Would You Know How to Stop Elder Abuse?

World Elder Abuse Awareness Day was observed recently, and we shared some helpful information in our email newsletter. (Sign up for our educational newsletter here.) Elder abuse is a complex issue that can encompass physical and emotional abuse, neglect, and exploitation. It’s estimated that 5 million older Americans are victims every year. And while that is far too many, it is estimated that for every 1 case of reported abuse, there are 23 more out there that go unreported!

The focus of World Elder Abuse Awareness Day this year was financial exploitation, which can take many forms. In developed countries like ours, abuse often involves theft, forgery, misuse of property and power of attorney, as well as denying access to funds.

Sadly, we see these things here in the office far too often. That’s why a few years ago we created a series on elder fraud. In this three part series, we explore common scams to watch out for, PLUS seven questions that can stop elder fraud in its tracks. Click on the links below to learn more so you can protect yourself or your loved ones:

It will take a community of loved ones, neighbors, professional advisors, case workers, etc. to continue to fight this shameful trend of taking advantage of seniors. Speaking up and educating people are important steps in the battle.

How Innovative Legal Help Saved the Relationship of Two Sisters

This is the real life story of two sisters, an annuity, nursing home costs, and why Medicaid Planning matters.

Mom did not have a lot, but she owned her home, had a steady retirement income, and had purchased two annuities. Each in the amount of $50,000.

Each daughter was named the beneficiary of “their” annuity and would, therefore, receive the $50,000 from the annuity when Mom passed away.

The older daughter fell on hard times and asked her mother if she could cash-in the $50,000 annuity. Mom agreed and the older daughter received her $50,000 “inheritance.”

The younger daughter, not needing her money, left her annuity in place as Mom had originally intended.

Unfortunately, several years later, Mom had a stroke and had to enter a nursing home. She privately paid for the nursing home costs until nothing was left but the home and the younger daughter’s $50,000 annuity.

But the annuity wasn’t truly the daughter’s. Mom was listed as the owner because she was still alive and would, therefore, have to spend the younger daughter’s inheritance before she could apply for Medicaid.

Of course this was very upsetting to the younger daughter. She was the one who hadn’t requested her money early. She was the one following Mom’s original plan for the money to pass upon her death. And yet, she was the one “being punished” financially by her Mom’s stay in the nursing home.

A Resolution

One of our attorneys sat down with the sisters for several hours listening to their story and devising a plan. In the end, we were able to develop a strategy that would allow an immediate transfer of the house to the daughter (thereby equalizing the daughters’ inheritances) while qualifying Mom for Medicaid several months later.

The mother continued to get the care she needed as she aged, and the daughters got a resolution to a very sticky situation. It was a very satisfying experience for our attorney and the two sisters!

We work with families everyday to find solutions to the challenges of estate planning — complicated family circumstances, business and farm succession planning, paying for a nursing home. It is our greatest pleasure when we can help families figure out legal solutions for complicated problems.

What Should You Do Next?

If you want to learn more about planning for exorbitant nursing home costs, check out the following resources:

  1. Download a copy of our Medicaid FAQ (that ran in a local publication) to learn more about paying for nursing care, qualifying for Medicaid, etc.
  2. Sign up for our Medicaid Planning e-course. This series of emails will teach you the basics about planning for Medicaid and applying for the benefit, plus provide you tangible steps to get started.
  3. Attend a free workshop to learn more about effective planning. At our workshop, How to Protect Your House and Life Savings from the Nursing Home, you’ll learn the five ways to pay for care, how benefits like Medicaid or VA can help get the care you or your loved ones needs, and the three keys to creating a “Good Care Roadmap” to protect your family and life savings. Check for upcoming dates here.
  4. If you need help right away, just give us a call at 217-726-9200. We understand that many cases like these are urgent. Our Benefits Coordinator, Melissa Coulter, will be more than happy to discuss your situation and what immediate actions should be taken.