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Recent Blog Posts
Your Estate Planning: Where There is a "Will," There is a Way
One of the most important legal issues that people need to take care of is not one that the majority of us like to even think about—making a will. However, it is also the one legal issue that is always inevitable—no matter who you are.
Having a key plan in place can help to guarantee that your final wishes are carried out. It can also help prevent the infighting that often occurs in families when a loved one dies without a will in place. Even relatives with the most altruistic motives can find themselves locking horns over what Mom or Dad's wishes would have been. Moreover, a will prevents a third entity—namely the state of Illinois—from making the determination of where your assets will go.
As difficult as it may be to sit down and begin making those decisions, there are ways to help make the process go smoother. Several key tips that legal advisors offer include the following:
Aging Gracefully: Consulting an Estate Plan or Probate Attorney
Entering the golden years gracefully takes planning. In fact, data derived from the Associated Press-NORC Center for Public Affairs Research at the University of Chicago, an independent global research organization, indicates that the Baby Boomer generation is in denial when it comes to addressing estate planning issues.
Per NORC survey results, NBC News reported that boomers, age 40 and over, admit to doing very little to prepare for late-life events. Two-thirds of the study participants revealed they have not scheduled a consultation with an experienced estate plan attorney. Even more alarmingly, one-quarter have opted out of considering a consult all together.
Moreover, many baby boomers are coming to age as active members of the sandwich generation, where little thought has been given to their own estate planning needs because more pressing needs of dealing with daily responsibilities are often compounded by their role of primary caregiver to an elderly parent or extended family member.
Special Needs Trusts: Securing the Future of a Special Needs Child
According to the 2010 U.S. Census Bureau, Americans with Disabilities Report, nearly one in five families are caring for a family member with a disability. Equating to about 56.7 million people, or 19 percent of the total population, the U.S. has witnessed an increase in those with qualifying disabilities by 2.2 million citizens. Not only has the number of those with disabilities risen, but the number and percentage of those requiring assistance has also increased.
The report also relates that four in 10 individuals with a disability, ages 21 to 64, often find themselves unemployed and facing persistent poverty levels as the ability to obtain viable employment opportunities may be out of reach.
As reported, one in every 26 American families are facing the challenges of raising a child with special needs, and 69 percent of those caring for a child report that they are concerned about providing lifetime care for their dependents with special needs.
How Will You Pay for Retirement?
Americans make arrangements for their retirement and other estate planning needs in several different ways. A Gallop poll of over 2,000 adults showed that most Americans are planning to rely on Social Security or retirement accounts for their future. However, the poll also revealed other sources of income that people were planning on utilizing for their golden years.
According to the poll, more than half of those surveyed said they plan on Social Security benefits as being their major source of retirement income. One third said those monthly benefits would actually be their primary source, while 51 percent said it would be a contributing source of their total retirement income.
Retirement accounts were noted as another source of income, yet only 48 percent cited these accounts as a primary source of retirement income. Even less—38 percent—cited 401(k) or IRA accounts as a major source of income. The low number of people counting on retirement accounts, financial analysts say, is due in large part to the recession several years ago. Many people in their fifties do not have nearly enough funds in their accounts to fund their retirement.
A Brief Guide to Special Needs Trusts
Anyone with special needs or disabled relatives wants to do everything they can to ensure the most comfortable and opportunistic future. Setting up a trust is one way to accomplish this. A trust is an agreement in which a third party, known as the trustee, holds assets for the beneficiary.
Setting up a trust for beneficiaries with disabilities can be challenging. While it is true that creating a special needs trust can be more involved than setting up a traditional one, these trusts can help provide for the needs of loved ones. The first step in deciding if a setting up a trust is a smart option is to understand how special needs trusts operate.
The laws that relate to special needs trusts are complex and often confusing. As the World Institute on Disability reports, disabled people cannot legally have a trust for themselves. However, this does not mean they will be excluded from an inheritance.
Reviewing Estate Plans on an Annual Basis
The arrival of the New Year often leads people to examine their decisions and lifestyle choices, as they look back at the year gone by and reflect. Many will make choices to go on diets, begin exercise programs, or make other changes to help ensure a longer, healthier life. The New Year is also a perfect time to look back and examine any events which may have occurred and will affect one's future financial plans.
Various life events may cause a person to make changes to any estate plans he or she has in place. Hence, financial advisors recommend reviewing these plans on an annual basis—the beginning of the New Year is a great time to review these plans.
Understanding the Four Main Types of Life Insurance
For obvious reasons, purchasing life insurance is an emotionally charged decision. Still, it is an important move that could save loved ones from financial hardship. This is especially true if you are the main income earner within your family.
It is a smart idea to consult a legal professional to discuss any concerns you have related to life insurance, wills, and estate planning. An experienced estate lawyer can provide feedback and advice based on your particular circumstances.
One of the most common challenges that come with purchasing life insurance is knowing the difference between the various policy types. Below is a basic breakdown of the most common insurance plans.
Term Life Insurance
Protecting Your Assets When You Are Gone
For many, working hard and saving for the future is essential. And by the time retirement is reached and a sizable nest egg has been built up, a sense of confidence is formed that upon passing, one's adult children and their families will be well cared for. But, what happens to that sizable inheritance if an inheriting adult child and his or her spouse divorce? How much of those funds can an ex-spouse walk away with? Or, what if the one receiving the inheritance is known to be financially irresponsible?
When Your Adult Child Divorces
In most situations, when an adult child receives inherited funds and then combines them with those of his or her spouse—such as purchasing a home—the funds become part of the marital estate. Therefore, should the couple split, the other spouse would be entitled to half of the worth.
Rethinking Trusts and Estate Planning
Too often, people think that estate planning and trusts are not applicable to their lives. They may feel they are not old enough to begin to plan, and therefore mistakenly believe that only senior citizens make estate plans and set up trusts. Additionally, they may think that only people who are rich set up trust funds. Again, this is not true.
Although many wealthy individuals do set up trusts to ensure their loved ones are taken care of and their estate is not eaten up by taxes, trusts can be set up by people who have a limited means.
A trust is useful in several ways. Whether the person setting it up is rich or has a limited income, it ensures that a person to whom the trust is being left, such as a young adult, will not spend all the money at once. Quite often, a trusted family member or friend is named as trustee to cut down on expenses of administrating a trust.
Are You Financially Prepared for a 25 Year Retirement?
Retirement and estate planning are very different now compared to past generations. Today, people live longer. The age of retirement has increased and many of us work far beyond the age of 65. In the nineties, the average age of retirement was 57 years old. Today, that number has jumped to 62. Therefore, if you do not have a solid financial retirement plan in place, you may have to continue working—at least part-time—much longer than originally anticipated.
When you do retire, chances are you will live longer than your ancestors. The average life expectancy for a man is 84 years old. Women live even longer and have an average life expectancy of 86 years. Hence, you will need enough money to live for an additional 25 to 30 years post retirement.
