Estate planning is about more than who gets what when. Estate planning is the way you give instructions and create a map for how you want to live out your life in somebody else’s care.
This article is in 2 sections. Section 1 describes what can happen without your plan in place. Section 2 tells you what life is like with a plan.
Would You
- Flush A $100 Bill Down the Toilet?
- Give an Addict $1,000?
- Let A Complete and Total Stranger Make Your Legal and Financial Decisions?
- Let A Total Stranger Make Your Healthcare Choices?
- Leave Your Finances Unprotected?
- Let the State Legislature Tell You Who Gets Your Stuff, When, And How Much?
- Sue Yourself with Your Own Money?
- Want Your Children’s Inheritance Spent on Court, Lawyers, and Fees?
This is exactly what can happen if you don’t have a plan!!!
Your Care
You probably want a say if you want to stay at home or go to a nursing home if you become incapacitated, agitated, or unable to make your own decisions. You probably want input as to how your money is spent and how your assets would be used for your care. You should have input as to your healthcare decisions that might need to be made and who makes them.
Without your plan in place, a Judge will likely have to approve who makes these decisions. The Judge will have to approve who takes care of you. The Judge who doesn’t know you or your preferences. And, it might be somebody you wouldn’t want or even a complete and total stranger.
In 1995, Terri Schiavo had a heart attack, was resuscitated, but suffered severe brain damage due to a lack of oxygen to her brain. Terri Schiavo lay in a hospital bed for 15 years while her husband and her mother fought over her healthcare decisions. For 15 years, her family shelled out money on lawyers, courts, and hospital costs. Her mom argued that the doctors were wrong in their diagnosis and prognosis, while her husband argued that she wouldn’t want to be kept alive artificially under these conditions. All in all, there were 14 appeals. That is 14 trips to court and all the costly preparation to go to court.
A healthcare power of attorney and an advance directive (living will) could have prevented all of this. A durable power of attorney would have allowed her husband to manage her financial and legal matters with a minimum of court intervention.
Your Money
Without a Will or Trust you don’t decide who gets your money! You are leaving that choice up the State Legislature. Your assets will go partially to your spouse and partially to your children in a ratio already decided by somebody else. If you don’t have children or a spouse, then the next in line are your parents then your siblings.
Even if your property would go, roughly, to the people you want in the amounts you want, court intervention in the distribution is often time consuming and expensive. Expensive as in up to 6% of your gross estate (no debts taken out) and in time and emotions.
Joe and Mary had a blended family. They worked hard together. Joe’s children took care of Mary in her declining years. When Joe passed, he left it all to Mary. However, when Mary passed, she left everything only to her own children. Joe’s hard work went completely to Mary’s children.
Jane’s dad John let his deceased wife’s mother adopt Jane. John never created an estate plan. When he passed away, Jane was very surprised that she got nothing. But, under the laws of adoption, she wasn’t legally John’s child.
Your Adult Children
You concern about who raises them has past. But, don’t you still want the right people in charge and control of the assets. Would you give $1,000 to an addict? How about giving money to a child in a shaky marriage? Your children deserve to be protected against creditors and financial predators.
Mike and Mary worried about their son. He was known to be an alcoholic and may be into drugs as well. They knew if they left him money he would spend it on alcohol and drugs. But, they didn’t know what else to do. A trust could have been used to make sure their son had a place to live and money to pay bills but no more.
Your Minor Children
Losing control is a major issue when you have children under 18 years old. The law considers them minors and will not put money directly in their hands.
If something happens to both parents, and there is not a plan in place, then the courts get all of the decision-making power as to who raises them. Moreover, you don’t get a say in how the money is used for their care.
And, when your children turn 18, they get total control of the money. Few parents feel that is a good idea.
With Your Plan
If you have a plan, the majority, if not all, of the plan the state legislature has already created for you is set aside. Your plan takes its place.
Your Care
Somebody you know and trust will help you make financial and legal decisions. You have already written down how you want your money and affairs managed. No judge or stranger steps in to take your rights away and make your own decisions.
Your Durable Power of Attorney gives your trusted family or advisors the ability to help manage your financial and legal affairs. They must follow the instructions you have left for them in that document.
Your Durable Power of Attorney for Healthcare makes sure your medical wishes are carried out. Combined with a Medical Information Waiver (HIPAA Waiver) and an Advance Directive, you will maintain your healthcare and dignity. If you want to live at home for as long as possible, this is the place to make sure your wishes are written down.
If Terri Schiavo had her healthcare wishes written down like this, she wouldn’t have laid in a hospital bed, costing her family a ton of money and time, for 15 years.
Your Money
Your Revocable Living Trust contains instructions to the next trustee on how you want your money managed and distributed. You maintain “long arm” control of your assets.
Your money goes to who you want, when you want, how you want, and in the amounts you want. You can leave detailed instructions and conditions on how the money is to be distributed and when.
Your Adult Children
Your adult children can be protected against creditors and financial predators by leaving their money in trust.
Mike and Mary setup a trust for their child with alcohol problems. They made sure his rent and bills were paid, but money wasn’t put directly into his hands to fuel his problem. Then, after their son passed away, the money went to his children.
Your Minor Children
You will have guardians, both temporary and permanent, named to take over the instant you aren’t available. Your children will never have to be part of the foster care system, even for just one night.
With your trust, you leave instructions as to how much money they get and when. You children can have their education paid for, their needs met, but not get a lump sum of cash until they are old and wise enough to manage it on their own.
The post The Shocking Truth About Not Planning appeared first on .
from http://ift.tt/2nUbnMH
from DeWitt Law Firm, PLLC
No comments:
Post a Comment