Last week, I talked about some common estate planning mistakes I see that can end up being costly, heartbreaking, and don’t fulfill the wishes of the deceased. Here are a few more to be on the lookout for:
– Improperly titled assets – Most people are busy living life and don’t think twice about whether their home or other assets are properly titled in their name. It usually doesn’t become a problem until the individual dies or the property is sold. However, I once had a very sad case with a home that was improperly titled between a husband and a wife, and when the husband suddenly died at a very young age, the wife was left with a lot of extra legal hassle that she didn’t need in her time of grief. As part of the estate planning process, you may want to consider asking your attorney to look up the deed to your home if you aren’t sure.
– Failing to plan for long-term care – This isn’t an estate planning mistake per se, but it can affect the deceased’s estate a great deal. The cost of a nursing home in the metro Atlanta area averages between $4,000 and $5,000 per month. Medicare will only pay for a few weeks following a hospitalization, and Medicaid won’t pay until most other assets are spent. Therefore, it’s great (if you can afford it) to purchase long-term care insurance, which can help cover those costs and avoid eating up every asset you spent your entire life working for. There are a lot of ways the insurance can be purchased to make it more affordable for individuals and couples. If you have any questions about long-term care insurance, give me a call.
– Failing to properly sign and notarize the documents – Georgia law requires that wills have two witnesses and a notary. Older wills may not have that notarization on it, which in some cases isn’t a problem, but it can be. It’s easy when signing your documents to miss a signature. Make sure your documents have all the required signatures, or you may have a problem.
– Failing to let anyone know if the documents have prepared and if so, where they are – Many clients are squeamish about talking about death or estate planning with their loved ones. However, it has to be done. At a minimum, let a close friend or loved one know where your documents are, or the name of the attorney who prepared them. I have been contacted before by family members asking if I prepared their loved one’s will. I have also heard some stories about important documents being left in whacky places and not being found when needed. At a time of grief, everything can be a little easier if the documents are easily accessible.
– Failing to let loved ones know about financial affairs, debts, assets, life insurance policies, etc. – You know how hard it is to keep up with your own financial and legal affairs. Suppose you had to take over someone else’s, but you had no clue about their debts, what assets they owned, what life insurance policies they had, etc.? It’s important to leave written instructions about your financial affairs with your documents. You can use the Memo to My Loved Ones, available here as a guide.
– Failing to do any planning to avoid estate taxes – For the last couple of years, virtually all of my clients haven’t had to worry about estate taxes because the estate tax exemption was so high. If nothing changes, that won’t be true next year – we are facing both a low exemption and a high tax rate. If you have a large amount of assets and/or large life insurance policies, you may want to do some tax planning as part of your estate plan.
All of these mistakes can be avoided with proper planning, and I know it helps me to sleep easier at night knowing that if something were to happen to my husband and I that my three daughters will be protected. If you have any questions about estate planning, call me at 678-453-6490 to learn more.
After you’ve been helping people plan their estates for a few years, like me, you begin to see common mistakes over and over. Some of the mistakes don’t end up causing any damage to the person’s ultimate plan. However, some mistakes can result in tens of thousands of dollars (or more) going to someone you don’t intend to have that money, a nightmare probate process, or worse. Below I list some of the most common estate planning mistakes I see, along with what usually happens when someone makes that mistake.
– Failure to do any planning whatsoever – This is very common. In fact, some studies show that over 70 percent of people die without a will. I have seen people pass away after extended terminal illnesses without wills or other documents. Many people just don’t want to face their own mortality, and that’s understandable. However, failing to do a will, power of attorney or advance healthcare directive will result in someone else (the state) deciding where your property goes. It means more oversight during the probate process, and if you become unable to manage your affairs while you’re living, it could mean a guardianship and/or conservatorship proceeding would have to be opened up for you, which can be both costly and emotionally draining.
– Failure to update your estate plan once it’s completed after life circumstances change – Although most people would love to be able to do their estate planning documents once in their lifetime and then forget them until they’re needed, unfortunately life doesn’t work like that. Divorces happen. Loved ones die. Relationships become estranged. Children are born. After one of these events, you should at a minimum review your documents. You may find that you left your entire estate to someone with whom you’re no longer speaking, or you failed to draft a trust for the benefit of children.
– Failure to update beneficiary forms – Beneficiary forms of assets like 401(k)’s and life insurance policies tell where the proceeds pass. In most cases, they will not pass through the estate. That means that updating those beneficiary forms is also a critical part of reviewing your estate plan. A failure to do so could result in an ex-spouse receiving life insurance proceeds, or an estranged child receiving a 401(k).
– Drafting a living trust but failing to fund it – Although for most of my clients, I don’t recommend living trusts, simply because I don’t feel they are necessary, many people either already have them or really want them. A critical part of executing a living trust is funding it – that means retitling assets in the name of the trust. I have seen living trusts drafted before that owned no assets. In those cases, the living trust becomes a very expensive will.
– Poorly drafted documents, sometimes from computer programs – Although there are programs out there that create great legal documents and can save attorneys’ fees, there are also really bad documents available, and often a client may not know the difference. I know someone who showed me a will he prepared using a $5 computer program he bought at an office supply store. The will was horrible and I don’t think it was legal. If you want to save money on attorney’s fees, consider preparing the documents yourself and finding an attorney who will review them for a fixed fee.
Next week, I’ll touch on a few other critical estate planning mistakes I often see. If you have any questions about any of these, feel free to shoot me an email at firstname.lastname@example.org, or call me at 678-453-6490.
I get a lot of questions from people about what kind of health care documents they need. In the past they may have executed both a living will and a durable power of attorney for health care, or they may have read online that they need a living will and a health care proxy. In Georgia, those documents have been replaced with one document – the Georgia Advance Directive for Health Care. Here are some things you need to know about the Georgia Advance Directive for Health Care:
- It names people who can make health care decisions for you if you can’t for yourself. That person, the health care agent, also may be chosen to make decisions about an autopsy, organ donation, body donation, and final disposition of your body.
- It allows you to state your wishes on life support if you have a terminal illness or an irreversible coma.
- It allows you to select a person who could serve as your guardian in the event the court ever had to appoint a guardian for you.
- It can act as a HIPAA waiver – that is, it will allow your health care agent to have the same access to your private medical records that you have.
- It allows your health care agent to accompany you in an ambulance or to visit with you while you are in a hospital or other health care facility.
- It allows your health care agent to carry out your life support wishes.
I like the Georgia Advance Directive for Health Care form. It simplifies the planning process by using only one health care form, and it’s fairly easy to understand. If you have questions about the Georgia Advance Directive for Health Care, call me, Sarah White, Marietta estate planning attorney, at 678-453-6490 today.
I recently read a great article discussing estate planning and digital media, such as eBooks, iTunes libraries and smartphone apps. Do you really “own” these items? Can you bequeath them in a will like you could a book collection or CD collection?
According to experts, the problem with bequeathing digital books and songs you think you own is that you don’t really own them. What you own is a license to use the digital files. Specifically, Amazon and Apple grant nontransferable rights to use Kindle books or to listen to songs on iTunes, but you can’t pass them to a child or spouse.
Estate planning laws in many states haven’t caught up to technology yet. In four states (but not Georgia), laws are in place to give loved ones access to email and social network accounts after someone passes, but they don’t cover digital files like iTunes or Kindle books. Hopefully, as people spend more and more money on digital content, the law will soon catch up to technology, enabling that content to be passed on like other property.
In the meantime, call me, Sarah White, Georgia estate planning attorney, if you have any questions about digital content. I can be reached at 678-453-6490 or email@example.com. I have a free form you might wish to use for social media planning – email me and I’ll be happy to send it to you.
I’ve had people tell me in the past that they don’t need to do estate planning because they “don’t have an estate to plan”. When I discuss estate planning with people, the term “estate planning” sometimes leads them to believe that they must be wealthy, or at least fairly comfortable, in order for an estate plan to be necessary. However, that couldn’t be further from the truth. The truth is, estate planning helps everyone prepare for what’s inevitable (death) and what is unexpected (a debilitating accident or disease).
Here are five reasons you may want to do an estate plan even if you don’t have many (or any) assets:
– You have minor children. If you have minor children, you want to do at least a minimal amount of planning. Ideally, you will have a will which will name guardians for those children in the event that something happens to both parents. You will also ideally have a trust in the will, which will shelter any assets you may have (including life insurance policies) to support the children until they are adults. At a minimum, however, if you aren’t willing to prepare a will or trust, you will need some type of writing that tells by whom you would want your children raised.
– You may become unable to manage your finances. If you were involved in an accident or developed Alzheimer’s or dementia, you may no longer be able to access your bank accounts, sign documents or contracts, or do anything that requires the mental capacity to enter into a contract. Virtually all estate planning attorneys will recommend that as part of the estate planning process, you execute a power of attorney which will allow a person you choose to handle your financial affairs.
– You may become unable to make healthcare decisions for yourself. You may remember Terri Schiavo, a young woman in Florida who died in 2005 after a very, very lengthy court battle between her parents and her husband. Ms. Schiavo went into cardiac arrest, suffered brain damage, and as a result was left in a persistent vegetative state. Her husband wanted her feeding tube removed, and her parents did not. The parties battled for years, and ultimately the feeding tube was removed and she died. If she had had a healthcare directive which spelled out her wishes, the situation could have been avoided. As part of estate planning, typically a Georgia Advance Directive for Healthcare is done.
– You don’t know what your assets will be when you die. Although you may consider yourself broke now, you don’t know what your assets will be when you pass away. You could win the lottery and die the same day (you think I’m making that up? Google “win lottery hit by car” and see what stories come up). You may receive an unexpected inheritance, or have life insurance you had forgotten about and didn’t name a beneficiary on. Situations like this are not rare. If any of these situations occurs and you don’t have a will, that property will most likely not go where you want it to go.
– Your family is at least a little dysfunctional. If you have a spouse, several grown children, all assets are titled correctly, your children all get along perfectly well, and you want your assets to go to your spouse upon your death, and then your children, you may be ok without a will, assuming you and your spouse do not die together, and that the surviving spouse immediately does estate planning upon the death of the first spouse. Guess how many situations I see like that. Very few. Unfortunately, death can bring out the worst in people. Most people I meet know at least one family that quit communicating after a death in the family because of hard feelings. At times, getting family members to cooperate after a death can be almost impossible. Take the guesswork out of the equation and do a will.
Many of my clients think they can’t afford to do any estate planning. The truth is you really can’t afford not to. I have reasonable prices, and payment plans and credit card payments are available. Call me, Sarah White, Marietta estate planning attorney at 678-453-6490 to learn more.
I get this question a lot. Yes, if you are going to be going out of town without your kids, and you are leaving your kids in the care of another person or persons, I recommend that you complete a basic temporary guardianship form. The form will serve as a notice that your kids are authorized to be under the care of another person. The form typically also consents to medical care for your children. If you are going out of town and need such a form, please email me at firstname.lastname@example.org and I would be happy to email you a blank form free of charge.
This temporary guardianship form is very different from issues that arise in other circumstances. For instance, you will name a guardian for your children in your will – this will tell who you want to raise your children in the event that something happens to both parents. There are also standby guardianship forms that can be of use to single parents in the event the parent becomes incapacitated. Finally, some parents of special needs children need to seek a guardianship over that child when the child turns 18 in order to continue making legal decisions for that child.
Do you have a potential guardianship issue that you need to speak to a Georgia attorney about? Call Sarah White, Marietta guardianship attorney at 678-453-6490 or email me at email@example.com. I would be happy to speak with you about those issues.
For my clients, I try to make the will and other documents as flexible as possible in order to take into account future circumstances. This usually means including unborn children in the estate plan, listing several possible executors and trustees, and listing several people who could inherit in the event the primary beneficiary has died. However, even if you tried to take into account all possible future events when drafting your documents, I still recommend you review them at least every five years.
In addition to reviewing them every five years, there are also several circumstances that might happen in your life that would cause you to need to review your estate planning documents. These include:
– The birth of a child
– A change in the tax laws, such as the change that is scheduled at the beginning of next year
– A divorce or break-up
– A death of someone close to you who may be named in the documents, such as a spouse, sibling, or child
– A change in your health
– The receipt of a large inheritance or other windfall
Regardless of whether you have experienced any of these, it’s still a good idea to review those documents every five years. If you have reviewed them and have any questions, call Sarah White, Cobb County estate planning attorney at 678-453-6490. I offer free phone consultations and I would be happy to answer any questions you may have.
As part of the estate planning process, I always strongly encourage my clients to update their beneficiary forms. This includes forms for life insurance policies, IRA’s, 401(k)s, and anything other accounts that have a POD (pay on death) form. Sometimes, my clients are shocked to discover that the forms were completed when they were single or married to another spouse, and they simply didn’t realize they needed to be changed. Or the beneficiaries were parents who have passed away or other relatives from which they may now be estranged. For many clients, I recommend naming the spouse as the primary beneficiary, and the children (either individually or a trust for the children’s benefit) as a secondary beneficiary. There are some occasions where I may recommend that the estate be named.
Unfortunately, if the forms leave the money to the wrong party, it can be almost impossible to get the funds back. That’s why it is so important to review not only your estate plan every couple of years (or after a major life event), but also as a part of that process, review the beneficiary forms. The few minutes of your time it will take to review those are well worth the peace of mind you will have in knowing that upon your passing, your assets go to whom you want them to go to.
Does your estate plan need updated? If you need a review of your documents, call Marietta estate planning attorney Sarah White at 678-453-6490 to learn the steps you need to take. Call today.
School will be back in session soon, and now is the time that many college students are gearing up to head back to campus. As part of the back to school process, I recommend that college students consider executing some estate planning documents. The vast majority of college students don’t do any type of estate planning, mainly for financial reasons, and probably because they think that since they don’t have much property or wealth anyway, there’s no reason to do the documents.
However, estate planning can be critical for college students. For most of my clients, I recommend three forms – a will, a power of attorney, and a Georgia Advance Directive for Healthcare. For college students in particular, the last two of those forms can be vitally important. A power of attorney and a healthcare directive are intended to be used while you are living but unable to make decisions for yourself about finances or healthcare. Without them, parents of students who are injured in an accident would have to petition a court in a lengthy process to obtain a guardianship or a conservatorship over the college student in order to handle their child’s affairs during his or her incapacitation. I don’t have any statistics available, but my practical experience tells me that those two forms, which are less expensive to prepare than a will, are used more often for typical college students than a will would be.
Are you a college student who feels you may need a will, power of attorney, or healthcare directive in the event the unimaginable happens? Call Sarah White, Cobb County estate planning attorney at 678-453-6490 to learn more about what you may need. Turnaround time can be quick and low cost packages are available.
This is a question I get all the time. I frequently meet clients who have already put their children’s names on their deed in order to make things easier when they pass away. It is true that having your children as co-owners on your assets avoids probate. Also, putting your children as co-owners of your property is fairly simple and can sometimes be done without an attorney. However, this is not something I recommend for a variety of reasons.
First, when you name your children as co-owners on assets such as real estate, they have as many rights to the property as you do. Although your children may be very responsible, upstanding citizens, many people fall on hard times unexpectedly. If your children were to file for bankruptcy, go through a divorce, rack up medical expenses or tax debts, those assets are theirs and are subject to those claims. Also, if your child is an owner of the property, he or she has as much of a right to sell it or live on it as you do. As you can imagine, this can create problems in some cases.
Also, there can be tax consequences to naming your children as co-owners of the property, both when you name them on the property, and when they sell it. It is typically much better from a tax perspective to give gifts at death rather than during life. In most cases, this will greatly reduce the amount of taxes they pay on the property when it is ultimately sold.
Finally, some people name only one child as a co-owner simply to make things easy, and they assure me that once they pass that child will share with the other children. However, legally that child does not have to share with his or her siblings. I hear a lot of horror stories about how much people change when there’s been a death in the family and how the money destroys relationships. You don’t want to let property drive a wedge between your children once you pass. Instead, I recommend letting everything pass through probate in most cases. Probate in Georgia can be simple, and it’s not worth the risks you take by naming a child as a co-owner of property simply in order to avoid probate.
Do you have any questions about probate in Georgia or how assets should be titled? If so, contact Cobb County estate planning attorney Sarah White at 678-453-6490 or email me at firstname.lastname@example.org. I would be happy to give you a phone consultation.