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Entries in Revocable Living Trust (62)

Friday
May262017

Building Asset Protection Into Your Estate Plan

Much of estate planning relates to the way a person’s assets will be distributed upon their death. But that’s only the tip of the iceberg. From smart incapacity planning to diligent probate avoidance, there is a lot that goes into crafting a comprehensive estate plan. One crucial factor to consider is asset protection.

One of the most important things to understand about asset protection is that not much good can come from trying to protect your assets reactively when surprised by situations like bankruptcy or divorce. The best way to take full advantage of estate planning concerning asset protection is to prepare proactively long before these things ever come to pass—and hopefully many of them won’t. First, let’s cover the two main types of asset protection:

Asset Protection For Yourself:

This is the kind that must be done long in advance of any proceedings that might threaten your assets, such as bankruptcy, divorce, or judgement. As there are many highly-detailed rules and regulations surrounding this type of asset protection, it’s important to lean on your estate planning attorney’s expertise.

Asset Protection For Your Heirs:

This type of asset protection involves setting up discretionary lifetime trusts rather than outright inheritance, staggered distributions, mandatory income trusts, or other less protective forms of inheritance. There are varying grades of protection offered by different strategies. For example, a trust that has an independent distribution trustee who is the only person empowered to make discretionary distributions offers much better protection than a trust that allows for so-called ascertainable standards distributions. Don’t worry about the complexity - we are here to help you best protect your heirs and their inheritance.

This complex area of estate planning is full of potential miscalculation, so it's crucial to obtain qualified advice and not solely rely on common knowledge about what's possible and what isn't. But as a general outline, let’s look at three critical junctures when asset protection can help, along with the estate planning strategies we can build together that can set you up for success.

  1. Bankruptcy:

It’s entirely possible that you’ll never need asset protection, but it’s much better to be ready for whatever life throws your way. You’ve worked hard to get where you are in life, and just a little strategic planning will help you hold onto what you have so you can live well and eventually pass your estate’s assets on to future beneficiaries. But experiencing an unexpected illness or even a large-scale economic recession could mean you wind up bankrupt.

Bankruptcy asset protection strategy: Asset protection trusts:

Asset protection trusts hold on to more than just liquid cash. You can fund this type of trust with real estate, investments, personal belongings, and more. Due to the nature of trusts, the person controlling those assets will be a trustee of your choosing. Now that the assets within the trust aren’t technically in your possession, they can stay out of creditors’ reach — so long as the trust is irrevocable, properly funded, and operated in accordance with all the asset protection law’s requirements. In fact, asset protections trusts must be formed and funded well in advance of any potential bankruptcy and have numerous initial and ongoing requirements. They are not for everyone, but can be a great fit for the right type of person.

       2. Divorce

One of the last things you want to have happen to the nest egg you’ve saved is for your children to lose it in a divorce. To make sure your beneficiaries get the parts of your estate that you want to pass onto them—regardless of how their marriage develops—is a discretionary trust.

 Divorce asset protection strategy: Discretionary trusts:

When you create a trust, the property it holds doesn’t officially belong to the beneficiary, making trusts a great way to protect your assets in a divorce. Discretionary trusts allow for distribution to the beneficiary but do not mandate any distributions. As a result, they can provide access to assets but reduce (or even eliminate) the risk that your child’s inheritance could be seized by a divorcing spouse. There are several ways to designate your trustee and beneficiaries, who may be the same person, and, like with many legal issues, there are some other decisions that need to be made. Discretionary trusts, rather than outright distributions, are one of the best ways you can provide robust asset protection for your children.

Family LLCs or partnerships are another way to keep your assets safe in divorce proceedings. Although discretionary trusts are advisable for people across a wide spectrum of financial means, family LLCs or partnership are typically only a good fit for very well-off people.

Judgment:

When an upset customer or employee sues a company, the business owner’s personal assets can be threatened by the lawsuit. Even for non-business owners, injury from something as small as a stranger tripping on the sidewalk outside your house can end up draining the wealth you’ve worked so hard for. Although insurance is often the first line of defense, it is often worth exploring other strategies to comprehensively protect against this risk.

  Judgment asset protection strategy: Incorporation:

Operating your small business as a limited liability company (commonly referred to as an LLC) can help protect your personal assets from business-related lawsuits. As mentioned above, malpractice and other types of liability insurance can also protect you from damaging suits. Risk management using insurance and business entities is a complex discipline, even for small businesses, so don’t only rely on what you’ve heard online or “common sense.” You owe it to your family to work with a group of qualified professionals, such as us as your estate planning attorney and an insurance advisor, to develop a comprehensive asset protection strategy for your business.

These are just a few ways we can optimize your estate plan to keep your assets protected, but every plan should be tailored to an individual’s exact circumstances. Contact our office so we can determine the best asset protection strategies for your estate plan.

If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

 

Wednesday
May242017

5 Reasons to Embrace the Emotional Side of Estate Planning

When you hear the phrase “estate plan,” you might first think about paperwork. Or your mind might land on some of the uncomfortable topics that estate planning confronts head-on: end-of-life decisions, incapacity, and your family’s legacy from generation to generation. Those subjects hit home for everyone.

But while that could feel like a reason to avoid estate planning, the emotional nature of these decisions is a reason to embrace the process with enthusiasm. Here are a few ways in which emotion in estate planning is a good thing:

  1. Estate Planning Creates Stability In Times Of Loss:

If you end up in a state of incapacity later in life, it’s guaranteed to be a difficult time for your family. If your estate plan doesn’t include detailed instructions for a trusted decision maker and an actionable long-term care plan, it’s guaranteed to be even worse. You can save your loved ones from the confusion about what to do and the pressure to make rushed choices if this occurs, allowing them to save their energy for processing the situation.

     2. Comprehensive Estate Plans Keep Emotional Matters Private

Detailed, trust-based estate planning with lifetime beneficiary directed trusts keeps your private matters out of the public eye. When your estate plan is scant—such as a simple “I love you” will—you’re running the risk of your estate going through court in a proceeding called probate. This means that choices become visible to those outside your inner circle. Because of the notice requirements, probate can also invite controversy and conflict which a private transfer would have avoided.

     3. Estate Planning Can Bring A Family Together:

Everyone has heard of a situation in which siblings argued over what their parents left them as beneficiaries. But the opposite is also quite true. When you get your family and other loved ones involved in your estate planning process, you gain a wonderful opportunity to show them how much you care. Creating your estate plan can strengthen the bonds of love in a family and serve as a reminder of those bonds for years to come.

     4. Your Estate Is About Much More Than Money:

Estate planning is about a whole lot more than just wealth distribution and taxes. During an estate planning session, we can talk about significant family heirlooms, your hard-won hobby collection, and other matters totally unique to your life. We can even dive deeply into the memories and intellectual property you want to make sure your beneficiaries receive, such as photos, art, and even recorded videos or audio files of family stories you’d like to share with future generations.

     5. An Estate Plan Means You’re Not Going It Alone:

You shouldn’t have to face trying times alone. Whether the estate in question is yours or a loved one’s, your estate planning attorney will have the answers. Let us take care of the nuts and bolts with regards to educating your appointed agents about their duties so you can know that your family will be in good hands if anything happens to you. The idea of setting everything straight on your own can be a stressful one, but these emotional decisions are much easier to make with a trusted advisor by your side.

We want you to feel ownership and investment in getting your estate plan to reflect who you are. Estate planning is an opportunity to look at some of life’s big questions and ultimately make sure your family feels your care for them through the choices you make. Schedule your free consultation with us today to see how we can create custom-made solutions that do just that.

If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

Monday
May222017

How to Build Freedom From Court Interference Into Your Estate Plan

It’s clear why you might want to avoid court involvement in your estate for financial reasons, knowing that probate can quickly get costly and time consuming for those involved. But there is an emotional component to it as well. Your assets are just that: yours. And the idea of them being discussed and deliberated on in a public forum might not be such an appealing one.

If you feel that the matters of your estate should be kept private and that your assets should be distributed to your loved ones rather than eroded by court fees, you’re not alone. And luckily, all it takes to get there is a proactive attitude toward planning your estate. Let’s dive in:

A. Court Interference 101

Two of the most common situations in which the court becomes involved in your estate are guardianship and probate: 

B.  Guardianship and Conservatorship

When someone experiences mental incapacity, documents in their estate plan can direct a trusted person to carry out that individual’s wishes for the situation. But what if no such documents have been drafted? Then their business becomes the government’s business, too. A court proceeding called guardianship or conservatorship (also known as “living probate”) will be held to appoint guardians and conservators to manage the affairs of the incapacitated person.

C. Probate:

When an estate goes through probate, the court oversees the gathering of the probate assets, payment of any outstanding debts, determining whether a will is valid, and who the deceased’s heirs are. The proceedings ultimately determine who should receive the assets that are left after payment of debts, taxes, and costs.

D. Free Your Estate From Interference:

To avoid guardianship, conservatorship, and probate, you can work with us to keep your affairs out of court entirely.

  1.  Powers Of Attorney:

Agents or attorneys-in-fact are the individuals or entities you appoint to make decisions for you, be they medical or financial. You designate agents or attorneys-in-fact in a document known as a power of attorney. Durable powers of attorney are documents that continue in validity after the incapacity of the maker of the document (i.e. “durable” against incapacity). Since a durable power of attorney continues in validity, a durable power of attorney can help bypass the need for court-appointed guardianship or conservatorship.

       2. Trusts:

Trusts are agreements that hold some or all your assets, and trustees can be either individuals or corporate entities. Unlike wills, trusts do not go through probate. There are several types of trusts, and we can help you decide exactly which kind is best suited to your estate. By setting up and completely funding a revocable living trust, you can accomplish two important things. First, you can rest assured that your assets will be distributed to your chosen beneficiaries and won’t go through probate upon your death. Second, you also retain the ability to change or cancel the arrangement during your lifetime enabling you to adjust your plan as your financial or family circumstances change.

Ensure That Your Estate Plan Is Air-Tight:

Deciding on appropriate powers of attorney and drafting revocable living trusts are just two of the many steps we can take together to keep your affairs free from court involvement. With a solid estate plan put into place with the help of a trusted attorney, you can take comfort knowing that everything you’ve worked so hard to build and maintain will be passed along to only the people who matter most. Contact our office today to learn more about interference-proofing your estate plan.

If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.


 

Friday
May192017

Avoid Living Probate: How to Keep Guardians and Conservators Out of Your Estate

While most proactive individuals know the importance of having a well-rounded estate plan, it is typically considered as something that will take effect after they have passed away. But in fact, there are many ways in which comprehensive estate planning can have a positive impact on your life while you are still around to reap the benefits.

Planning for Incapacity:

Most people who reach old age come to a point at which they are no longer able to handle all their affairs on their own. In many cases this incapacity is due to dementia or other cognitive impairments associated with the elderly. At that point, the decisions they’ve made with their estate planning attorney can have major repercussions on their lifestyle and the handling of their wealth.

Take Alex for example. Long before Alex retired from his long and successful career as an IT manager at a large corporation, he put a cursory estate plan in place with a will detailing who would get which of his assets upon his death. But, Alex didn’t update his plan as he aged. In his late seventies, he developed Alzheimer's and it became unclear to his family how to proceed with his medical care and wealth management. Since Alex did not formally choose an individual to be in control of his affairs in the event of incapacity, it falls upon the court to appoint a guardian or conservator. Unfortunately, that’s where things get complicated.

What is guardianship?

Guardianship goes by a few other names, so it’s important to get familiar with various terms used to indicate similar and somewhat overlapping concepts. The other terms you may hear include “conservatorship,” “plenary guardianship,” and “living probate.”

It’s important to note that these terms are used in slightly different manners from state-to-state, with some states using “guardian” and “conservator” interchangeably. Others maintain the distinction of a guardian being a person who makes decisions about medical care and living arrangements, whereas a conservator makes decisions about property and assets. In either case, the guardian or conservator is essentially a substitute decision maker that’s authorized by the court to make decisions on behalf of the incapacitated person.

3 Reasons You Should Avoid It:

In the process of living probate, the court tries to settle on solutions that will fit the incapacitated individual’s best interests. However, there is a much better way. Here are just a few of the reasons guardianship and conservatorship are not ideal fallbacks:

    1. Cost To put it simply, living probate is expensive. The legal fees associated with court-appointed attorneys representing incapacitated individuals can chip away at their estates very quickly. Living probate also brings your affairs into the public sector.

    2. Privacy Alex may not have wanted his family to have to experience the financial and emotional costs of his living probate court proceedings, but he may also have felt less than enthusiastic about his personal affairs being discussed in a public forum.

    3. Clarity In addition to being costly and a compromise of privacy, living probate is also full of guesswork. If Alex had assigned powers of attorney and established long-term care provisions in his estate plan, his affairs would be handled exactly as he wished in the event of his incapacity. When the court is involved, they usually apply default rules of state law, which means the legislature is essentially making some choices for you and your family.

    How to Structure Your Estate Plan:

    What does an individual like Alex need to do to avoid the chance of his family having to go through living probate? There are a few specific steps we can take to make in planning your estate to ensure your affairs never end up in a court-appointed guardian’s hands:

    1. Powers of Attorney:

    A complete estate plan includes named powers of attorney who will fulfill the roles of guardians and conservators in the event of your incapacity. The difference is that these individuals will be chosen by you rather than by the court. There are several different types of powers of attorney for specific purposes, such as a healthcare power of attorney or a general durable power of attorney, the latter of which controls the management of your finances.

           2. Long Term Care Planning

    Although you may never need long-term care, building a strategy for it into your estate plan will allow you to relax knowing that you’ll receive long-term care according to your wishes if that becomes necessary. This type of planning also helps protect the assets in your estate plan from being used up on medical expenses before going to your beneficiaries.

    Avoiding guardianship and conservatorship through living probate is a relatively pain-free process if handled well ahead of time. Get in touch with us today to go over the parts of your estate plan that may need amending to give you and your family the best possible outcomes. We are here to help and can quickly get your estate plan in optimal shape.

    If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Thursday
    May182017

    Do It Now: Name a Guardian for Your Minor Child

    We know it’s hard. Thinking about someone else raising your children stops us all in our tracks. It feels crushing and too horrific to consider. But you must. If you don’t, a stranger will determine who raises your children if something happens to you—your child’s guardian could be a relative you despise or even a stranger you’ve never met.

    Due to the importance of choosing an appropriate Guardian, and our experience seeing firsthand the difficulties people go through determining who to name—we have created a step-by-step Guide: How To Choose Your Child’s Guardian. To obtain your free copy, click here.

    No one will ever be you or parent exactly like you, but there is someone who could muddle through and provide for your children’s general welfare, education, and medical needs. Parents with minor children need to name someone to raise them (a guardian) in the event both parents should die before the child becomes an adult. While the likelihood of that happening is slim, the consequences of not naming a guardian are more than intense.

    If no guardian is named in your will, a judge—a stranger who does not know you, your child, or your relatives and friends - will decide who will raise your child. Anyone can ask to be considered, and the judge will select the person she deems most appropriate. Families tend to fight over children, especially if there’s money involved - and worse - no one may be willing to take your child; if that happens, the judge will place your child in foster care. On the other hand, if you name a guardian, the judge will likely support your choice.

    How to Choose a Guardian:

    Your child’s guardian can be a relative or friend. Here are factors our clients have considered when selecting guardians (and back up guardians).

    1. How well the child and potential guardian know and enjoy each other
    2. Parenting style, moral values, educational level, health practices, religious/spiritual beliefs
    3. Location - if the guardian lives far away, your child would have to move from a familiar school, friends, and neighborhood
    4. The child’s age and the age and health of the guardian-candidates:
    •  Grandparents may have the time, and they may or may not have the energy to keep up with a toddler or teenager
    •  An older guardian may become ill and/or even die before the child is grown, so there would be a double loss
    • A younger guardian, especially a sibling, may be concentrating on finishing college or starting a career.

          5. Emotional Preparedness:

             a. Someone who is single or who doesn't want children may resent having to care for your   children.

             b. Someone with a houseful of their own children may or may not want more around.

     

    WARNING:

    Serving as guardian and raising your child is a big deal; don’t spring such a responsibility on anyone. Ask your top candidates if they would be willing to serve, and name at least one alternate in case the first choice becomes unable to serve.

    Who’s in Charge of the Money?

    Raising your child should not be a financial burden for the guardian, and a candidate’s lack of finances should not be the deciding factor. You will need to provide enough money (from assets and/or life insurance) to provide for your child. Some parents also earmark funds to help the guardian buy a larger car or add onto their existing home, so there’s plenty of room for extra children.

    Factors to consider:

           1. Naming a seperate person to handle this money can be a good idea. That person would be a guardian of the estate or a trustee, but not guardian of the children.

           2. However, having the same person raise the child and handle the money can make things simpler because the guardian would not have to ask someone for the money.

           3. But the best person to raise the child may not be the best person to handle the money and it may be tempting for them to use this money for their own purposes.

     Compromise Will Likely be Necessary:

    Naming a guardian is a difficult decision for most parents. Keep in mind that this person will probably not raise your child because odds are that at least one parent will survive until the child is grown. By naming a guardian, however, you are being responsible and planning for a bad—but avoidable—situation arises. It’s important to realize that no one besides you will be the perfect parent for your child, so typically this means making compromises in some areas. Select the person you think will muddle through the best.

     Let’s Continue this Conversation:

    We know it’s not easy, but don’t let that stop you. We’re happy to talk this through with you and legally document your wishes. Know that you can change your mind and select a different guardian anytime you’d like. You are a parent and your job is to provide for and protect your children, so let’s do this—together. To get started, download your free copy of our Guide: Choosing Your Child’s Guardian. Next, contact our office to schedule your free consultation and we’ll get your children protected.

     

    If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Sunday
    Feb262017

    Better to Play it Safe: Proactive Estate Planning & Cognitive Impairment

    Most financially savvy individuals begin planning their estate when they’re in peak mental shape. The idea that this might change at some point in the distant future is an unpleasant one, and they would rather go about their estate planning as if they’ll be as sharp as a tack late into their golden years. Unfortunately, this common approach of ignoring a potential problem and hoping it simply won’t happen can leave a giant hole in your estate plan. Read on to find out that this common hole can be more easily filled than you might think. 

    Expect The Best, But Plan for The Worst:

    The reality is that an individual’s chances of experiencing some form of cognitive impairment rise with age. While it’s never certain whether cognitive impairment will occur, smart estate planning means factoring it in as a very real possibility.

    As the huge baby boomer generation transitions from the workforce and begins to make their way into retirement, cases of Alzheimer's are expected to spike from the current 5.1 million to 13.2 million as soon as 2050. Alzheimer’s is just one of several cognitive impairment conditions along with dementia and the much more common mild cognitive impairment, or MCI, which is often a precursor to those more serious ailments.

    As U.S. life expectancies increase, the chances of living with cognitive impairment increase as well — with at least 9.5 percent of Americans over 70 experiencing it in one form or another.

    No matter your age or family history, cognitive impairment can affect anyone although it’s widely acceptedto affect mostly older adults. As you implement or revise your estate plan, it is well worth the effort to plan for this potential. Luckily, estate planning attorneys have developed good solutions to handle this circumstance and can help guide you on the best way to protect yourself and your family.

     An Easily-Avoidable Estate Planning Mistake:

    Consider Ashley’s story. A successful real estate agent with a stellar career in her hometown of Kalamazoo, MI, Ashley begins planning her estate in her mid-thirties.

    She partners with an estate planning attorney, and together they draft a revocable living trust with Ashley’s preferred beneficiaries and charities in mind, figure out guardianship for her two sons in case she and her husband pass suddenly, and settle on an appropriate beneficiary for her life insurance policy. Now that she knows where her assets will go after her death, Ashley rests easy assuming there’s nothing more that needs doing in her estate plan.

    Save Your Family From Obstacles and Conundrums:

    But forty years down the road, Ashley’s children realize her MCI is developing into Alzheimer’s. Although she’s occasionally visited with her attorney to adjust her plan, she never added any provisions for how she wanted her children and other guardians to handle a situation like this. Here’s where things get complicated.

    Ashley did not work with her estate planning attorney to put disability provisions into her trust and never worked with an insurance professional to purchase adequate income insurance or long-term care insurance. The care she requires to live her best life possible with cognitive impairment doesn’t come cheap. Those mounting care costs will likely quickly erode Ashley’s estate. As a result, her estate plan may no longer work as intended, since it no longer lines up with her actual asset portfolio.

    But since Ashley does not have the ability to rework her estate plan in her current mental state, her family is left with the burden of figuring out what to do while navigating a complex and bureaucratic legal system in the guardianship or conservatorship court. No one in the family really knows what Ashley’s wishes are regarding both serious medical decisions and financial changes. All Ashley’s family wants is to see her enjoying her remaining years in peace and security, but they are now tasked with using guesswork to make difficult choices on her behalf while a guardianship or conservatorship court watches every move.

    Give Us a Call Today:

    Factoring the potential for cognitive impairment into your estate plan doesn’t have to be a headache. In fact, a little effort now by legally designating who you want to be in charge and what you want them to do can have a wonderful impact on you and your family later on. We can work together to ensure your estate plan is ready for whatever life throws your way. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Friday
    Feb242017

    Passing to the Next Generation— A Powerful Exercise

     “Every one of us receives and passes on an inheritance. The inheritance may not be an accumulation of earthly possessions or acquired riches, but whether we realize it or not, our choices, words, actions, and values will impact someone and form the heritage we hand down.”

    — Ben Hardesty 

    Successful estate planning is about far more than simply passing your wealth to the next generation—it’s also about passing on your values. No matter which financial or legal structures you choose to contain and manage your assets, these instruments only preserve your wealth until it reaches the hands of your beneficiaries. What happens then? Your values enabled you to accumulate wealth and persevere despite all obstacles and long odds. If your children and grandchildren don’t share and cherish those values, they could lose their inheritance as quickly as they received it.

     But our values can be hard to capture in language. They seem second nature to us only because we live them every day. Here’s an exercise to help you identify your (perhaps) rarely-spoken moral code and communicate it to the next generation.

    The Science of Surfacing Your Subconscious Values:

    In Chapter 3 of his bestselling book, Getting Things Done: The Art of Stress-Free Productivity, productivity author David Allen discusses what he calls vertical project planning—that is, identifying the “why’s” and“what’s” of any project before engaging with its details. To reveal the standards that you have regarding any task, just finish the following sentence:

    I would give others totally free rein to do this as long as they…

    For instance, if you’re planning a dinner celebration for your dad’s 70th birthday, you could fill in the blanks as follows:

    …So long as they created a budget for the party and got buy-in from both of my sisters to contribute;

    …So long as they made sure to double check the guest list with mom;

    …So long as they booked a restaurant within 30 minutes from my parents’ home.

     As it pertains to communicating values, we could reword it like this:

    I would give a total stranger free rein to guide the people I care about most about how to live a great and moral life as long as they…

    …So long as they make sure to communicate my core values of creativity, compassion and integrity;

     …So long as they give many concrete examples of these standards being met and not met to demonstrate exactly what I mean;

     …So long as there’s some mechanism to remind my family of these values in an ongoing way, so that they don’t forget;

     …So long as they make inheritance from the trust I establish conditional on whether my beneficiaries live these values.

     

    Estate planning is ultimately not only about passing along your tangible wealth and deciding how to distribute assets. It’s an opportunity to ensure your legacy into the next generation and beyond. Clarifying your values and working to effectively pass them along can be a profoundly liberating experience. 

    If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

     

    Wednesday
    Feb222017

    Got Stuff? George Carlin Says You Need An Estate Plan!

    George Carlin would have been a great pitchman for estate planning. You may remember his stand-up routine on “stuff.” We all have stuff, and we're quite particular about our stuff. We move it around with us, it's hard for some of us to get rid of it, and some of us don't like our stuff mixed up with other people's stuff.

    During your lifetime, you collect a lot of stuff, some of it valuable and some of it not. But because it's your stuff, it means something to you. You already know you can't take it with you when you die, so there must be some way of distributing your stuff to other people.

    Normally, you want your stuff to go to people you care about—your family and special friends, sometimes a worthwhile cause. And you may want certain people to have certain things to remember you by.

    Document Instructions for Your Stuff:

    When you die, all your stuff, no matter how valuable or invaluable it is, is called your "estate." In the simplest terms, an “estate plan” is your instructions for getting your stuff to the people you want to have it after you die.

    Important Legal Mumbo Jumbo: 

    An estate plan must meet certain legal requirements, including that it must be written down, it must be signed by you, and it must be witnessed by other people who see you sign it. Your estate plan may be very simple, or it may be more complex, depending on how much stuff you have, how long you want your stuff to provide for the people you care about, and when you want them to receive your stuff. For example, you'd probably want to wait a few years before that cute two-year-old receives grandpa's antique pocket watch.

    How Do You Get an Estate Plan? 

    You decide who you want to get your stuff and when you want them to get it. Your attorney then puts your instructions into a legal document called a will or trust. (There are distinct advantages to using a trust, but we'll save that discussion for another time.) Also, while you can legally write your own, you have a much better chance of your estate plan working if you have an experienced attorney do it for you. To be frank, laypersons mess it up all the time.

    What Happens if I Just Don’t Get Around to It?

    What if you die and you don't have an estate plan? Well, there still must be a way to get your stuff to other people, so the state in which you live has a plan waiting if you don't have one. The only problem is that you won't have any say in who gets your stuff, and someone might get left out, and, your stuff may go to a stranger—some “heir at law”—that you don’t even know.

    Example 1: If more than one of your relatives want the same part of your stuff, that can get messy and expensive… and a lot of your stuff will be used to pay the courts and attorneys to sort it all out. (Happens all the time.) 

    Example 2: If you're not married and you want your significant other to get some of your stuff when you die, you'd better get your plan in place, or it just won't happen. Under the state's plan, your stuff will go to your blood relatives. Period.

     Example 3: If you're married and you've got kids, don't be too sure that your spouse is going to get all your stuff. Your kids will probably get their share of your stuff, which means your spouse may not get enough of your stuff to live on.

    By the way, if your stuff includes kids, then you've got to have a plan. Otherwise, the court will decide wh will raise them if something happens to both parents.

    Scary thoughts? You bet!

    The Bottom Line:

    If you're responsible enough to have your own stuff, you need to be responsible for making sure what will happen to it after you're gone. Let’s make sure you do it right; call the office now and we’ll help you translate your plans for your stuff into a legally binding document. To ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Thursday
    Feb092017

    3 Famous Pet Trust Cases—Lessons Learned

    Things don’t always go according to plan. Sometimes, pet owners can get a bit creative when providing for their pets. Let’s look now at 3 famous cases involving pet trusts and distill important lessons from them.

    David Harper and Red:

    David Harper, a wealthy, reclusive bachelor in Ottawa, Canada, wasn’t exactly famous during his life. In his death, however, he made headlines by reportedly leaving his entire $1.1 million-dollar estate to his tabby cat, Red. Just to make sure his wishes were carried out, Harper bequeathed the fortune to the United Church of Canada under the stipulation that they take care of Red for him! The ploy worked.

    Lesson learned: You can be as creative as you desire in your approach to making sure your pets receive proper care after you’re gone.

    Maria Assunta and Tommaso:

    In a four-legged and furry version of the classic rags-to-riches story, wealthy Italian widow Maria Assunta rescued a stray cat from the streets of Rome and gave him a proper home and name: Tommaso. As Assunta’s health failed, she tried for several years to find an animal organization to entrust Tommaso. When no suitable organization was found, Assunta left the estate valued at $13 million directly to the cat in her will and named her own nurse as caretaker. She passed away in 2011 at the ripe old age of 94, knowing her beloved Tommaso would be well taken care of.

    Lesson learned: The best way to ensure the care of your pet is in writing, with a proper estate plan.

     

    Patricia O’Neill and Kalu:

    Patricia O’Neill, daughter of British nobility and ex-spouse of Olympian Frank O’Neill, had designated a fortune worth $70 million to her chimpanzee, Kalu and other pets, in her will - or so she thought. It was discovered in 2010 that the heiress herself was virtually broke, thanks to the shady dealings of a dishonest financial advisor. This story provides perhaps the most famous example of a pet trust gone dry while the owner is still living.

    Lessons learned: You can only give away what you have. If caring for your pets after your death is important to you, make sure your financial plan is in line with your estate plan and that you’ve taken appropriate steps to oversee your advisors.

     To summarize, establishing a pet trust is the best way to ensure that your beloved pets receive the care they deserve after you pass on. If you want to ensure that your family—including your pet animals—are cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Wednesday
    Feb082017

    A Trust—the Best Option for Avoiding Probate

    Ideally, when someone passes away, the paperwork and material concerns associated with the estate are so flawlessly handled—usually thanks to excellent preparation—that they fade into the background, allowing the family to grieve and remember in peace.

    In fact, the whole business of estate planning—or at least a significant piece of it—is concerned with ease. How can assets and legacies be transferred to the next generation in a harmonious, stress-free, fair process?

    To that end, one primary goal of many people is to avoid the complications and costs involved with probate.

    There are many “tools of the trade”, that a qualified attorney can use to keep your assets out of probate—for example, establishing joint ownership on bank accounts and real estate titles, designating beneficiaries for life insurance policies and certain accounts, and so on. However, setting up a revocable living trust is quite often the best, most comprehensive option for avoiding probate. Let’s discuss why this is true.

    What is a trust?

    Often touted as an alternative to a will, a trust is a legal structure that permits management of your assets by a trustee on behalf of your beneficiaries. A living trust is established while you are still alive, as opposed to being created upon your death. You can be the trustee for your own living trust until you are no longer able to manage your financial affairs or pass away, at which point the responsibility for managing the trust passes to someone you designate as a successor trustee.

    How does a trust help you avoid probate?

    The purpose of probate is to transfer property ownership for all assets that were listed in your name when you passed away. A trust can bypass this process completely because your assets are transferred to the trust while you are still alive. Therefore, when you die, there’s nothing that needs to be transferred by the probate court (everything is already in your trust). Furthermore, a trust can cover virtually any type of asset, from real estate to vehicles to stock to bank accounts. When a trust is structured correctly with the help of an experienced estate planning attorney, your entire estate can stay out of probate court entirely. This process not only limits court costs, but it also maintains the privacy of your financial records while enabling your beneficiaries to enjoy the benefits of the trust without disruption or delay.

    Establishing a trust can be a bit complicated, and the process can cost a bit more upfront than a will; however, if you’re willing to invest a little more up front, a trust can be your best option for avoiding probate later. Especially in California, probate should generally be avoided absent extenuating circumstances.

    That said, as wonderful as revocable living trusts can be—always bear in mind H.L. Mencken’s warning that “For every complex problem there is an answer that is clear, simple, and wrong.”

    The key to planning effectively to minimize the likelihood of a drawn out, contentious, expensive process is to work with highly qualified, trusted people. Find a lawyer who genuinely cares about you and your family and who knows how to forge the right strategy for you and your family. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Wednesday
    Dec282016

    3 Reasons You Want to Avoid Probate

    When you pass away, your family may need to visit a probate court in order to claim their inheritance. This can happen if you own property (such as a house, car, bank account, investment account, or another similar asset), which is solely in your name. Although having a Will is a good basic form of planning, a Will does not avoid probate. Instead, a Will simply allow you inform the probate court of your wishes—your family still must go through the probate process to make those wishes legal.

    Now that you have an idea of why probate might be necessary, here are 3 key reasons why you want to avoid probate at all costs possible.

    1. It’s all public record:

    Almost everything that goes through the courts, including probate, becomes a matter of public record. This means when your estate goes through probate, all associated family and financial information becomes accessible to anyone who wants to see it. This doesn’t necessarily mean account numbers and social security numbers, since the courts have at least taken some steps to reduce the risk of identity theft. But, what it does mean is that the value of your assets, creditor claims, the identities of your beneficiaries, and even any family disagreements that affect the distribution of your estate will be available, often only a click away because many courts have moved to online systems. Most people prefer to keep this type of information private, and the best way to ensure discreteness is to keep your estate out of probate.

    2. It can be expensive:

    Thanks to court costs, attorney fees, executor fees, and other related expenses, the price tag for probate can easily reach into the thousands of dollars, even for small or “simple” estates. These costs can easily skyrocket into the tens of thousands or more if family disputes or creditor claims arise during the process. This money from your estate should be going to your beneficiaries, but if it goes through probate, a significant portion could go to the courts, creditors, and legal fees, instead.

    3. It is a long process:

    While the time frame for probating an estate can vary widely from state to state and by the size of the estate itself, probate is not generally a quick process. It’s not unusual for estates, even seemingly simple or small ones, to be held up in probate for 6 months to a year or more, during which time your beneficiaries may not have easy access to funds or assets. This delay can be especially difficult on family members going through a hardship who might benefit from a faster, simpler process, such as the living trust administration process. Bypassing probate can significantly speed the disbursement of assets, so beneficiaries can benefit sooner from their inheritance.

    If your assets are in multiple states, the probate process must be repeated in each state in which you hold property. This repetition can cost your family even more time and money. The good news is that with proper trust-centered estate planning, you can avoid probate for your estate, simplify the transfer of your financial legacy, and provide lifelong asset and tax protection to your family. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Friday
    Dec232016

    5 Mistakes Made by Successor Trustees—How to Prevent Them

    When establishing a trust, you need to give serious thought to choosing your successor trustee—the person who will administer your trust once you’re no longer able to do so. This individual ideally should be:

    1. Someone you trust implicitly.

    2. Someone who is organized, responsible and meticulous.

    3. Someone who can remain steadfast to your wishes in the face of family disagreements and other disputes regarding the trust.

    That said, even the most capable, well-intentioned successor trustees can make mistakes when managing affairs. Here are five surprisingly common mistakes along with steps to take to prevent them from happening.

    1. Faulty Record-keeping:

    To ensure that a trust fulfills its purpose without being contested, the trustee must keep accurate, detailed records of income and distributions. Your trustee must also be prepared to report these figures regularly to the beneficiaries and heirs. If these records are incomplete or inaccurate, the door is opened for someone to challenge the trust, potentially leading to lengthy and costly court battles.

    To prevent this mistake: Hire an accountant to assist the successor trustee in record-keeping, and make sure the trustee and the accountant make a connection before the trustee takes over.

    2. Misunderstanding the Fiduciary Role:

    Many trustees mistakenly assume their job involves acting in the best interests of the person setting up the trust. In reality, his or her job is to act in the interests of the beneficiaries of the trust. Furthermore, the trustee may be legally liable for any failure to protect the beneficiaries against bad investment advice concerning the trust.

    To prevent this mistake: Detail the fiduciary role of the successor trustee in the trust documentation itself, and be certain that the trustee understands his/her role.

    3. Not Collaborating Effectively with Your Established Financial Team:

    The successor trustee’s failure to communicate with key members of your team while administering your trust can lead to inaccuracies, misunderstandings and significant, preventable financial losses.

    To prevent this mistake: Make sure your trustee is properly introduced to, and connected with, your attorney, CPA, financial planner and anyone else involved with your estate planning.

    4. Failing to Discuss Compensation:

    If your appointed trustee is a close friend or family member, the topic of compensating the trustee may be glossed over or forgotten. This oversight can result in a lack of morale or even resentment if managing the trust becomes difficult or time consuming.

    To prevent this mistake: Bring up the topic of compensation yourself when you establish the arrangement; be as generous as you deem necessary; and put the compensation terms in writing.

    5. Failing to Remain Objective:

    Many people choose a close family member as a trustee. This strategy can be appropriate, especially when privacy matters. However, disputes about money can happen even in the tightest-knit families, and it can be difficult to near-impossible for a relative to remain neutral when resolving those fights. The end-result could be decisions that family members perceive to be unfair or that wind up being inconsistent with your intentions.

     To prevent this mistake: Make certain the person you choose can remain neutral and faithful to the terms of the trust, even under duress. If there is any doubt, consider hiring a corporate trustee with no emotional connection to the family or estate.

    Selecting a successor trustee is one of the most important decisions you will make during your estate planning process. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Wednesday
    Dec212016

    5 Tragic Mistakes People Make When Leaving Assets to Their Pets

    A pet trust is an excellent way to make sure your beloved pet will receive proper care after you pass on. The problem, of course, is that you won’t be there to see that your wishes are carried out. It’s critical to set up a pet trust correctly to ensure there are no loopholes or unforeseen situations that could make your plans go awry. Here are 5 tragic mistakes people often make when leaving their assets to their pets.

    1. Appropriating more than the pet could ever need:

    The gossip stories about such-and-such celebrity who left his or her entire fortune to a pet are the exception rather than the rule. Leaving millions of dollars, houses, and cars to your pet is not only unreasonable, but it’s more likely to be contested in court by family members who might feel neglected. To avoid this pitfall, leave a reasonable sum of money that will give your pet the same quality of life that she enjoys now.

    2. Providing vague or unenforceable instructions:

    Too many pets don’t receive the care their owners intended because they weren’t specific enough in their instructions or because they did not use a trust to make the instructions legally binding. Luckily, a pet trust can clarify your instructions and make them legally valid.

    If you leave money to a caretaker without a pet trust in place, hoping it will be used for the pet’s care for example, nothing stops the caretaker from living very well on the pet’s money. But when you use a pet trust to designate how much the caretaker receives and how much goes for the pet’s care, you’ve provided a legal structure to protect your furry family member. You can be as specific about your wishes as you’d like, from how much is to be spent on food, veterinary care, and grooming. You can even include detailed care instructions, such as how often the dog should be walked.

    3. Failing to keep information updated:

    Bill sets up a pet trust for his dog Sadie, but what happens if Sadie passes away? If Bill gets a new dog and names her Gypsy, but he doesn’t update this information before he dies, Gypsy could easily wind up in a shelter or euthanized because she’s not mentioned in the trust. This is a common yet tragic mistake that can be easily avoided by performing regular reviews with your estate planning attorney to ensure that your estate plan works for your entire family.

    4. Not having a contingency plan:

    You might have a trusted friend or loved one designated as a caretaker in your pet trust, but what happens if that person is unable or unwilling to take that role when the time comes? If you haven’t named a contingent caretaker, your pet might not receive the care you intended. Always have a “Plan B” in place, and spell it out in the trust.

    5. Not engaging a professional to help:

    Too many people make the mistake of trying to set up a pet trust themselves, assuming that a form downloaded from a do-it-yourself legal website will automatically work in their circumstances. Only an experienced estate planning attorney should help you set it up to help ensure that everything works exactly the way you want.

    When attempting to leave assets to your pet, the good news is that with professional help, all these mistakes are preventable. Talk with us today about your options for setting up a new pet trust or adding a pet trust to your current estate plan. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Monday
    Dec192016

    Why You Need an Estate Plan To Compliment Your Financial Plan

    If you want to leave a robust financial legacy for your family, a financial plan alone is like trying to guide a boat with just one oar. It’s only part of the big picture for your overall monetary health. A well-informed financial plan is worth your time for several reasons, but let’s look at how financial and estate planning can work in tandem to create the best possible future for you and your family in the years to come.

    What’s included in a financial plan:

    Financial planners take stock of an individual’s fiscal landscape and come up with approaches to maximize his or her overall financial well-being. Take Emily for instance, an energetic project manager in her late-twenties. She’s found a successful career track after graduating with her bachelor’s and now has the steady income necessary to start daydreaming about buying a house with bay windows like the one she passes on her morning commute.

    But before she can take such a big leap, Emily tracks down a skilled financial planner who will take an honest look at her foreseeable cash flow and her spending and saving habits. People from all walks of life use the help of financial planners to make sure they’re in good shape for making big purchases, saving for their children’s education, and ensuring a comfortable retirement. This also includes developing an investment portfolio, which the financial planner monitors and manages.

    But financial planning only goes so far. To have a comprehensive approach, Emily also must also consider her estate and the wills and trusts she should put in place so her assets go where she wants them to in the long run. That’s where a trusts and estates attorney comes in.

    What’s included in an estate plan:

    Estate planning attorneys are lawyers who give sound advice about what will happen to a person’s assets if he or she becomes mentally incapacitated or when he or she dies. While this may not sound like the sunniest of topics, knowing that what you pass on to your family will be legally protected lets you focus on enjoying the best things in life without worrying about your loved ones’ futures. Estate planning includes defining how you want your loved ones to benefit from the financial legacy you leave behind, implementing tactics to protect your assets from creditors down the road, providing a framework so your loved ones can make medical decisions on your behalf when you can’t, developing strategies to help you reduce estate taxes, and more.

    And at the end of the day, your attorney is a teacher. He or she should be equipped to clearly explain your legal options. Even though estate planning can be highly technical, your professional bond with your attorney can and should feel like a friendly partnership since it involves taking an honest look at many personal wishes and priorities. There is no one-size-fits-all estate plan, so choose an attorney whom you trust and enjoy working with and who is responsive to questions and needs.

    Remember Emily? While financial planning helped, her get from point A to point B with some pretty big money milestones, she now knows she needs an estates and trusts attorney to make sure her wishes are carried out and her money stays in the right hands—her family’s.

    How these two efforts work together:

    There are several ways these two components of your financial wellness work in harmony. Asking your financial planner and estate planning attorney to collaborate is common practice, so don’t be concerned that what you’re asking is outside their regular scope of work. Knowing who else advises you will help both parties get the information they need do their jobs at peak effectiveness. For example, your estate planning attorney may prepare a living trust for you, but your financial planner may help you transfer certain assets into that trust.

    What are you waiting for?

    If you already have a financial planner and are thinking about working with a trusts and estates attorney, you’re in an excellent position. We can often collaborate with your advisor to begin working on your estate plan. This might save you time and money, as we’ll get up to speed with the help of your financial planner.

    The right time to plan your estate is right now. The sooner you put yourself and your family able to rest easy knowing a solid plan is in place, the better. And now that you know your financial plan is a wonderful start—but not a complete solution—you’re ready to take the first step on the path to total financial security.

    If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Friday
    Dec162016

    3 Famous Pet Trust Cases and The Lessons Learned

    Not long ago, pet trusts were thought of as little more than eccentric things that famous people did for their pets when they had too much money. These days, pet trusts are considered mainstream. For example: in May 2016, Minnesota became the 50th (and final) state to recognize pet trusts. But not every pet trust is enacted exactly per the owner’s wishes. Let’s look at 3 famous pet trust cases and consider the lessons we can take away from them so your furry family member can be protected through your plan.

    Leona Helmsley and Trouble:

    Achieving notoriety in the 1980s as the “Queen of Mean,” famed hotelier and convicted tax evader Leona Helmsley passed away in 2007. True to form, her will left two of her grandchildren bereft and awarded her Maltese dog Trouble a trust fund valued at $12 million. The probate judge didn’t think much of Helmsley’s logic, however, knocking Trouble’s portion down to a paltry $2 million, awarding $6 million to the two ignored grandchildren and giving the remainder of the trust to charity. Furthermore, when Trouble died, she was supposed to be buried in the family mausoleum, but instead she was cremated when the cemetery refused to accept a dog.

    Lessons learned: Leaving an extravagant sum to a pet may not be honored in a lawsuit and can cause family conflict. It’s best to leave a reasonable amount to provide for the care and lifestyle your pet is used to, for the rest of his or her life. If you are looking to disinherit one or more family members, make sure to specifically talk with your attorney so you can have a game plan to make the disinheritance as legally solid as possible.

    Michael Jackson and Bubbles:

    Most Michael Jackson fans will remember his pet chimpanzee Bubbles, who was the King of Pop’s constant companion. Jackson reportedly left Bubbles $2 million. After the singer’s death, Bubbles’ whereabouts became a point of speculation amid allegations that Jackson had abused the pet while he was alive. The good news is that Bubbles is alive and well, living out his years in a shelter in Florida. The bad news is that if he was left $2 million, he never received it; and he is being supported by public donations.

    Lessons learned: Always be clear about your intentions and work with your attorney to put them in writing so your furry family member is cared for and doesn’t wind up in a shelter.

    Karla Liebenstein and Gunther III (and IV):

    Liebenstein, a German countess, left her entire fortune to her German Shepherd, Gunther III, valued at approximately $65 million. Tragically, Gunther III passed away a week later. However, the dog’s inheritance passed on to his son, Gunther IV; the fortune also increased in value over time to more than $373 million, making Gunther IV the richest pet in the world.

    Lesson learned: It’s possible for pet trust benefits to be passed generationally, so make sure your estate plan reflects your actual wishes and intentions.

    If your estate plan has not already made arrangements for your beloved pet, we’re here to help. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Wednesday
    Dec142016

    3 Tips for Overwhelmed Executors

    While it is an honor to be named as an executor of a will or estate, it can also be a sobering and daunting responsibility. Being a personal representative requires a high level of organization, foresight, and attention to detail to meet all responsibilities and ensure that all beneficiaries receive the assets to which they are entitled. If you’ve found yourself in the position of “overwhelmed executor,” here are some tips to lighten the load.

    1.  Get professional help from an experienced attorney:

    The caveat to being an executor is that once you accept the responsibility, you also accept the liability if something goes wrong. To protect yourself and make sure you’re crossing all the “i’s” and dotting all the “t’s,” consider hiring an experienced estate planning attorney at the beginning. Having a legal professional in your corner not only helps you avoid pitfalls and blind spots, but it will also give you greater peace of mind during the process.

    2. Get organized:

    One of the biggest reasons for feeling overwhelmed as an executor is when the details are coming at you from all directions. Proper organization helps you conquer this problem and regain control. Your attorney will help advise you of what to do when, but in general, you’ll need to gather several pieces of important paperwork to get started. It’s a good idea to create a file or binder so you can keep track of the original estate planning documents, death certificates, bills, financial statements, insurance policies, and contact information of beneficiaries. Bringing all this information to your first meeting will be a great start.

    3. Establish lines of communication:

    As an executor, you are effectively a liaison between multiple parties related to the estate: namely, the courts, the creditors, the IRS, and the heirs. Create and maintain an up-to-date list of everyone’s contact information. You’ll also want to retain records, such as copies of correspondence or notes about phone calls for all the contact you make as executor. Open and honest communication helps keeps the process flowing smoothly and reduces the risk of disputes. It’s worth repeating because it’s so important -- keep records of all communications, so you can always recall what was said to whom.

    If you have been appointed as an executor, and you are feeling overwhelmed, we can provide skilled counsel and advice to help you through the process. We can also help you set your own estate plan, so your family can avoid the stress of probate. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Friday
    Dec092016

    3 Celebrity Probate Disasters and Lessons to Learn from Them

    With all the wealth accumulated by the rich and famous, one would assume that celebrities would take steps to protect their estates once they pass on. But think again: Some of the world’s richest and most famous people have passed away without a will or a trust, while others have made mistakes that tied their fortunes and heirs up for years in court. Let’s look at three high-profile celebrity probate disasters and discover what lessons we can learn from them.

    1. Tom Carvel:

    As the man who invented soft-serve ice cream and established the first franchise business in America, Tom Carvel had a net worth of up to $200 million when he passed away in 1990. He did have a will and accompanying trust that provided for his widow, family members and donations for several charities, but he also named seven executors, all of whom had a financial stake in the game. The executors began infighting that lasted for years and cost millions. In the end, Carvel’s widow passed away before the disputes could be settled, essentially seeing none of the money.

    Lesson learned: “Too many cooks spoil the broth.” Your trustee and executor may have to make tough decisions. Consider naming executors and trustees who have no financial interest in your estate to reduce the risk of favoritism. Also, consider have only a single trustee and executor rather than a committee.

    2. Jimi Hendrix:

    Passing away tragically at age 27, rock guitarist Jimi Hendrix left no will when he died. What he did leave behind was a long line of relatives, music industry bigwigs, and business associates who had an interest in what would become of his estate - both what he left behind, and what his intellectual property would continue to earn. An attorney managed the estate for the first two decades after Jimi’s death, after which Jimi’s father Al Hendrix successfully sued for control of the estate. But when Al attempted to leave the entire estate to his adopted daughter upon his passing, Jimi’s brother, Leon Hendrix, sued, launching a messy probate battle that left no clear winners.

    Lesson learned: When you don’t leave a will or trust, the effects can last for generations. An experienced estate planning attorney can help put your wishes in writing so they are carried out after your death rather than opening a door to costly conflict.

    3. Prince:

    The court battle currently in preparation over Prince’s estate is a celebrity probate disaster in action. When the 80’s pop icon died in early 2016, he left no will, reportedly due to some previous legal battles that left him with a distrust of legal professionals in general. The lines are already being drawn for what will likely be a costly and lengthy court battle among Prince’s heirs. Sadly, there’s even a battle looming about determining who his heirs are—for certain.

    Lesson learned: Correct legal documentation protects your legacy. Don’t let a general distrust or a bad experience cause your heirs to fight and potentially lose their inheritance.

    These celebrity probate disasters serve as stark reminders that no one’s wealth is exempt from the legal trouble that can occur without proper estate planning. As always, we are here to help you protect your family and legacy. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Wednesday
    Dec072016

    Your Estate Planning Binder—Tips for Proper Care and Maintenance

    You finally crossed “getting your estate plan done” off your list, and you’ve (rightly) breathed a huge sigh of relief. By tackling this challenge, you’ve not only established protections for your loved ones and legacy, but you’ve also freed up some important “mental space” that had previously been preoccupied.

    Once you create the documents that make up your estate plan, your estate planning attorney will prepare a binder containing all pertinent documentation. This estate planning binder is critical because it provides key information regarding your intentions after you pass away or if you become incapacitated. Once your trust is fully funded, your binder should also contain information about your assets. This makes administration easier for your family. This binder should be stored safely, reviewed regularly, and updated when necessary to avoid confusion when your loved ones need to refer to it.

    Before we get into the nuts and bolts about how to complete this review process – to help you stay in control now that you’re there – let’s first take a step back and clarify a point that confuses many clients. Your estate plans and your financial plans for the future are two completely different things. They are both obviously important, and they both should be kept in a safe place and reviewed often. However, the estate planning binder has special importance because it contains your wishes and instructions for what should happen if you become incapacitated and when you die…as well as who should be in charge of what—at those times. But this binder is not the same thing as your financial plan. Your financial plan is a comprehensive plan of the assets you have now (and the assets you may need in the future) to help you achieve your goals in life.

    Where to Keep Your Estate Planning Binder:

    Your estate planning binder should be kept in a safe place along with your other important financial information. We recommend keeping it secured in a safe deposit box at your local bank or in a fireproof strong box, if you keep the documents at home. You can make photocopies or scans of the documentation for your own use if you wish to refer to them more frequently or have them as a backup. Remember though, the original documents have legal significance, so don’t create a situation where your family is forced to attempt to rely on copies - you need to safeguard your originals!

    Who Should Have Access to the Binder:

    You obviously have discretion regarding who can access your personal financial information. However, strongly consider retaining direct access yourself until circumstances require someone else to step in to take control. If you keep the binder in a safe deposit box, for example, you could keep a spare key in your home or office and notify your attorney, next of kin, or successor trustee as to the key’s location in case they need to use it. Talk to your bank about what limited access rights to the safe deposit box might be available.

    How Often to Review Or Update Your Binder:

    Your financial situation is likely to change over time – and perhaps more critically, other powerful and unexpected life events can shift your priorities and necessitate an adjustment to your plan.

    For instance, the death of a spouse or life partner, a new marriage, an illness or accident that affects your child’s future, a sudden job loss or the surprising success of a business venture that you’ve plugged away at for years, or even a spiritual epiphany can reshuffle what’s important to you.

    These events can also limit or constrain what’s possible for your future. Without renegotiating these commitments in a conscious way, you’ll likely feel intangible unease about them. The moral is that your binder should be reviewed periodically and updated to reflect the changes that happen in your life.

    As a rule of thumb, we recommend reviewing your estate plan as follows:

    1. A quick review once a year

    2. A thorough review every 3-5 years to ensure the documents reflect your current finances and intentions

    3. Any time you experience a significant increase or decrease in income or wealth

    4. Any time you experience a major life change, such as a birth, marriage, or death in the family

    5. Any time you consider a change in who you want to benefit from your estate plan

    Keeping your estate planning binder secure and up to date will reduce confusion and likelihood of disputes when others need to enact your wishes for your estate. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Monday
    Dec052016

    Including Grandkids in your Will—5 Tips to Avoid Common Problems

    As we build wealth, we naturally desire to pass that financial stability to our offspring. With the grandkids, especially, we often share a special bond that makes us want to provide well for their future. However, that bond can become a weakness if proper precautions aren’t set in place. If you’re planning to include the grandchildren in your will, here are five potential dangers to watch for, and ways you can avoid them.

    1. Including no age stipulation:

    We have no idea how old the grandchildren will be when we pass on. If they are under 18, or if they are financially immature when you die, they could receive a large inheritance before they know how to handle it, and it could be easily wasted.

    Avoiding this pitfall: Create a long-term trust for your grandchildren that provides continued management of assets regardless of their age when you pass away.

    2. Too much, too soon:

    Even if your grandkids are legally old enough to receive an inheritance when you pass on, if they haven’t learned enough about handling large sums of money properly, the inheritance could still be quickly squandered.

    Avoiding this pitfall: Outright or lump-sum distributions are usually not advisable. Luckily, there are many options available, from staggered distributions to leaving their inheritance in a lifetime, “beneficiary-controlled” trust. An experienced estate planning attorney can help you decide the best way to leave your assets.

    3. Not communicating how you’d like them to use the inheritance:

    You might trust your grandchildren implicitly to handle their inheritance, but if you have specific intentions for what you want that inheritance to do for them (e.g., put them through college, buy them a house, help them start a business, or something else entirely), you can’t expect it to happen if you don’t communicate it to them in your will or trust.

    Avoiding this pitfall: Stipulate specific things or activities that the money should be used for in your estate plan. Clarify your intentions and wishes.

    4. Being ambiguous in your language:

    Money can make people act in unusual ways. If there is any ambiguity in your will or trust as to how much you’re leaving each grandchild, and in what capacity, the door could be opened for greedy relatives to contest your plan.

    Avoiding this pitfall: Be crystal clear in every detail concerning your grandchildren’s inheritance. An experienced estate planning attorney can help you clarify any ambiguous points in your will or trust.

    5. Touching your retirement:

    Many misguided grandparents make the mistake of forfeiting some or all of their retirement money to the kids or grandkids, especially when a family member is going through some sort of financial crisis. Trying to get the money back when you need might be difficult to impossible.

    Avoiding this pitfall: Resist the temptation to jeopardize your future by trying to “fix it” for your grandchildren. If you want to help them now, consider giving them part of their inheritance in advance, or setting up a trust for them. But, always make sure any lifetime giving you make doesn’t leave you high and dry.

    If you’re planning to put your grandchildren in your will or trust, we’re here to help with every detail you need to consider. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.

    Saturday
    Dec032016

    Giving Your Kids an Early Inheritance—4 Things to Consider

    If you’re thinking about giving your children their inheritance early, you’re not alone. A recent Merrill Lynch study suggests that these days, nearly two-thirds of people over the age of 50 would rather pass their assets to the children early than make them wait until the will is read. It can be especially satisfying to fund our children’s dreams while we’re alive to enjoy them, and there’s no real financial penalty for doing so, if the arrangement is structured correctly. Here are four important factors to take consider when planning to give an early inheritance.

    1. Keep the tax codes in mind:

    The IRS doesn’t care whether you give away your money now or later. The lifetime estate tax exemption as of 2016 is $5.45 million per individual, regardless of when the funds are transferred. So, whether you give up to $5.45 million away now or wait until you die with that amount, your estate will not owe any federal estate tax (although, remember, the law is always subject to change). You can even give up to $14,000 per person (child, grandchild, or anyone else) per year without any gift tax issues at all. You might hear these $14,000 gifts referred to as “annual exclusion” gifts. There are also ways to make tax-free gifts for educational expenses or medical care, but special rules apply to these gifts. Your estate planner can help you successfully navigate the maze of tax issues to ensure you and your children receive the greatest benefit from your giving.

    2. Gifts that keep on giving:

    One way to make your children’s inheritance go even farther is to give it as an appreciable asset. For example, helping one of your children buy a home could increase the value of your gift considerably as the home appreciates in value. Likewise, if you have stock in a company that is likely to prosper, gifting some of the stock to your children could result in greater wealth for them in the future.

    3. One size does not fit all:

    Don’t feel pressured to follow the exact same path for all your children in the name of equal treatment. One of your children might prefer to wait to receive her inheritance, for example, while another might need the money now to start a business. Give yourself the latitude to do what is best for each child individually; just be willing to communicate your reasoning to the family to reduce the possibility of misunderstanding or resentment.

    4. Don’t touch your own retirement:

    If the immediate need is great for one or more of your children, resist the urge to tap into your retirement accounts to help them out. Make sure your own future is secure before investing in theirs. It may sound selfish in the short term, but it’s better than possibly having to lean on your kids for financial help later when your retirement is depleted.

    Giving your kids an early inheritance is not only feasible, but it also can be highly fulfilling and rewarding for all involved. That said, it’s best to involve a trusted financial advisor and an experienced estate planning attorney to help you navigate tax issues and come up with the best strategy for transferring your assets. If you want to ensure that your family is cared for, please click here to schedule your complimentary Estate Planning Strategy Call with San Francisco’s premier estate planning attorney, Matthew J. Tuller.