Topics Include:
- Why planning is important and what motivates me.
- Avoiding probate.
- Medical Power of Attorney
Category: Estate Planning
Debbie London Baker on Ask the Experts, July 2024
People think they NEED a Trust. You have other options.
People call and say “I Need a Trust.” It’s often during our first conversation, and quite often, it’s not true. They’ve heard from friends that it’s necessary in order to avoid probate. It may be necessary for that purpose and isn’t always the case.
In Florida, Trusts can help avoid probate which can be a draining process – emotionally and financially. And can be avoided in more ways that creating a Trust.
My experience is that families with adult children and adult grandchildren have simpler methods to distribute their assets as they like – mainly through beneficiary designations and Lady Bird deeds (enhanced life estate deeds).
Assets named with primary and secondary (contingent) beneficiary designations are generally sufficient. Beneficiary designations supersede anything that may be in a Last Will and Testament and are not available to estate creditors. Lady Bird deeds (enhanced life estate deeds) are instruments that pass real property outside the probate process while owners maintain all their rights until such time as they pass.
An example is a client who called with the statement about needing a trust. After compiling a list of her assets including real property, they realized that beneficiary designations and the Lady Bird Deed would suffice. Their income was a pension and social security which both will end when she passes. They had small bank accounts and an IRA for which they had already named a beneficiary. By going to their bank and naming primary and contingent beneficiaries and naming contingent beneficiaries for her IRA, the estate was covered.
I do recommend trusts in these situations among others:
- when families have minor children, sometimes even minor grandchildren;
- when there is a child or adult with special needs already receiving government benefits or who may need government benefits at a later time
- when the client doesn’t want some/all of their beneficiaries to inherit substantial assets (as defined by the client) until a specific age or spread out over time.
Sometimes I recommend a trust where a client has no children and their beneficiaries are siblings who are older and the chance of a sibling predeceasing the client is not unrealistic. I often recommend a Trust for this client to preclude the need to do anything if one of the siblings predecease. The Trust would outline that the now deceased sibling’s share goe to their children and would keep the estate out of probate.
For married couples, trusts can offer tax planning advantages and help manage assets if one spouse becomes incapacitated. And for snowbirds or those who own property in multiple states, a trust can eliminate the need for multiple probates.
Does everyone need a trust? No. For some, a well-crafted will, powers of attorney, and advance directives are enough.
The best way to know? Sit down with an experienced, compassionate attorney (bonus points if they have a sense of humor) and explore your options.
Creating an Estate Plan Does Not Have to be Painful
Creating an estate plan might sound about as fun as scheduling a root canal, but trust me, it doesn’t have to be painful. In fact, with the right guidance (ahem, like from someone who thinks probate can be fun), crafting your estate plan can bring peace of mind and maybe even a chuckle or two along the way.
Essential Pieces of an Estate Plan
Let’s dive into the essential pieces you should consider for your estate plan:
The Will
Think of your will as the playbook for your loved ones. It’s where you decide who gets the heirloom dining set and who’s in charge of making sure Fido is fed.
Without a will, the courts will make these decisions, and let’s face it: the courts really don’t know that Aunt Sue deserves your Star Wars figurine collection.
A will is a legal document that tells everybody how your assets and property should be distributed. When done properly, it saves your family from a whole of of hassle with probate courts.
A Trust (Maybe)
If you’ve ever thought, “How can I make life easier for my loved ones when I’m gone?” a trust might be the answer. Trusts can help avoid probate (fewer court headaches) and make sure your assets go where you want, when you want. They’re like the VIP pass to estate planning—convenient and smooth.
Durable Power of Attorney
This one’s not glamorous, but it’s crucial. A durable power of attorney lets someone you trust handle your finances if you’re unable to do so. Without it, your family might have to petition the court to manage things—and no one wants to juggle legal drama on top of everything else.
Healthcare Directives
What happens if you can’t make medical decisions for yourself? Enter your healthcare surrogate and living will. These documents spell out your wishes, ensuring your loved ones aren’t left guessing at a time when emotions are running high.
Beneficiary Designations
Your retirement accounts and life insurance policies need attention, too. Make sure your beneficiary forms are up-to-date, because these trump anything written in your will.
Letters of Instruction
This is your chance to say the things that didn’t fit in your will. Like, “Don’t forget to water the succulents” or “Here’s where I hid the good wine.” It’s a thoughtful touch your loved ones will appreciate.
Conclusion
An estate plan isn’t just about assets—it’s about your legacy, your loved ones, and ensuring your wishes are honored. So, let’s make the process not just manageable but meaningful. Maybe even a little fun.
Debbie London Baker on Ask the Experts, June 2024
Topics Include:
- What’s the most important thing someone can do to get started with their estate plan?
- A common misconception – “I always thought I have to have a lot before I plan”
- What if the person I appointed Power of Attorney dies?
- Key surprise areas that cause distress after someone passes
Hurricane Season & Your Legal Documents
This sometimes-personal conversation occurred a few weeks after Hurricane Milton devastated Tampa in October 2024, and now is a good time to remember the lessons: get your documents in order and make sure you have backups and copies.
The 2025 Hurricane Season is upon us, and it’s time to prepare. Organize your legal documents, save remote copies/backups with family, backup services, and perhaps key people mentioned in your documents.
Estate Planning is for Your Life
It might be hard to believe, but estate planning is for your life first, and later for your death.
One reason people don’t do end-of-life planning is they think that when they plan, they’ll die soon. Well, that could happen, but it’s usually very improbable. When done the right way with someone who listens, empathizes, keeps the mood light, you can create an estate plan that makes your life better.
How an Estate Plan Helps Your Life
Here are some of the things that estate planning does for you while you are alive:
- Gets you thinking about the real meaning of your life, what you want to pass on beyond your life and what’s most important to you to do now;
- Gets you thinking about how you want to be cared for at the end of your life and lets you name someone to make those good decisions for you;
- Has you think about your money, who you want it to go to, how you want it handled, what you want it to do in the world after you aren’t here;
- Names someone to care for your children in case you can’t;
- Allows you to provide for a special needs child or other loved one without disrupting their governmental benefits;
- Protects your assets from divorce – yours or your children’s – as well as lawsuits and creditors;
- Enables you to gift portions of your estate to your children or charities while you are still alive in a tax-advantaged way that inspires wealth creation instead of depletion;
- Helps you plan for your own long-term care in a way that won’t deplete your estate
Of course, having an estate plan also offers you peace of mind that you have done what you could to protect loved ones and pass on your assets efficiently after death. Having an estate plan in place before you pass guarantees that:
- Your personal property and assets will pass to the people you want to have them
- You spare your family the expense and pain of having to go through the probate process
- Your minor children are provided for in the way you choose, with a guardian named to raise them with your values and a trusted adviser in place to manage their finances until they come of age
- Your assets are protected for your heirs by setting up a trust with a distribution option for when they reach adulthood (or other milestones of your choice)
- Beneficiaries have been named for retirement and other financial accounts as well as life insurance policies so the assets in these accounts go to the people you choose
- The financial privacy of your family is protected
Legal Documents in Hurricane Preparation
/RSS FeedThis sometimes-personal conversation occurred a few weeks after Hurricane Milton devastated Tampa in October 2024, and now is a good time to remember the lessons: get your documents in order and make sure you have backups and copies.
The 2025 Hurricane Season is upon us, and it’s time to prepare. Organize your legal documents, save remote copies/backups with family, backup services, and perhaps key people mentioned in your documents.
Key Surprises that Cause Distress After Someone Passes
/RSS FeedTwo main ones in my experience – lack of proper beneficiary designations on bank accounts, IRAs, life insurance…AND residences being incorrectly titled – especially when purchased by people in committed relationships. They often think, “For sure, if one passes, the other automatically owns the whole.” Not so!
It’s easily avoided.
What if the person I appointed Power of Attorney dies?
/RSS FeedThis happens. Sometimes a person appointed Power of Attorney dies. It’s readily remedied. I recommend successors already be in place to prevent having to do anything.
