Estate Planning Pop Quiz

Posted by Robert L. Arone August means school is back in session or just around the corner, signaling the return of new school supplies, homework, and pop quizzes. Try your hand at this estate planning pop quiz to see if your knowledge of estate planning makes the grade. Question #1: True or false? The only people involved in an estate plan are the client and the estate planning attorney who drafts the documents. Answer: False. Many advisors such as financial planners, certified public accountants (CPAs), and insurance agents play an important role in the estate planning process. For example, one of the first steps in creating an estate plan is understanding what property the client owns. This may include tangible property such as real estate, vehicles, and collectibles, as well as intangible assets such as retirement accounts and insurance policies. A client’s advisors can help the estate planning attorney understand everything the client owns

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Estate Planning Awareness: Don’t Fall Victim to These Common Myths

Posted by Robert L. Arone Left unaddressed, these myths can create serious trouble for families and individuals, often leading to intrafamily conflict, permanently damaged relationships, and lengthy and expensive court battles. Myth #1: Estate planning is only for the wealthy. When the topic of estate planning comes up, professional advisors often hear their clients respond with phrases like “Oh, estate planning is only for rich people,” or “Why do I need an estate plan? I plan to spend it all before I die!” Unfortunately, this kind of response, perhaps subconsciously, allows the person making the statement to avoid having to expend any further energy thinking about the uncomfortable reality of their own mortality and the consequences of not having planned for their incapacity or death. As their professional advisor, consider whether you have a responsibility to gently push back on such responses from a client. Most things worth doing are

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Working with Co-trustees: How You Can Help

When clients select a successor trustee for their trust, they frequently choose one person to serve as a successor trustee at a time. Many attorneys continue to recommend that only a single trustee be appointed to avoid the potential for disagreements or conflicts between co-trustees during the trust administration after the trustmaker’s death or disability. This can be a prudent approach and works well in many situations. This is particularly true when the appointed trustee diligently keeps the trust beneficiaries informed about the trust administration and carefully fulfils the trustee’s responsibilities under both the law and the provisions of the trust document. However, many clients are reluctant to place the entire responsibility for trust administration on one person. As a result, it is increasingly common for a trustmaker to nominate two or more family members or friends to serve as successor co-trustees. In some cases, it may even be beneficial

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Trust Protectors: Are They a Good Fit for Your Client?

Posted by Robert L. Arone What Is a Trust Protector? Traditionally, the three roles that must be filled when setting up a trust are the settlor (also called a grantor, trustor, or trustmaker), the trustee, and the beneficiary. All three roles are necessary to create a trust that functions properly. Although it is relatively common to use trust protectors in foreign asset protection trusts, a trust protector is a fairly new role in trusts drafted in the United States for estate planning purposes. However, as the number of trusts designed to last for generations grows, estate plans need more built-in flexibility. Giving a trust protector, through the terms of the trust, certain powers over the trust, such as removing or appointing trustees, adding or removing beneficiaries, and amending or even terminating the trust, ensures that your client’s intentions for creating the trust are fulfilled despite changing law or circumstances. How

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Is Your Client’s Estate Plan Incapacity Proof?

Posted by Robert L. Arone For most people, it is perfectly natural to think about estate planning only in terms of planning for death. While it is certainly important for clients to make a plan for their eventual death, if that is all they plan for, their planning will be woefully inadequate. As medical knowledge and technology have improved over the decades, so too has modern medicine’s ability to keep people alive for much longer. It is no accident that in many areas of the country, long-term care facilities such as assisted living centers and nursing homes are being built at record pace.[1] At first blush, staying alive longer would seem to be a good thing. And for many people, it is. However, simply living longer does not necessarily result in ideal circumstances. Longevity coupled with incapacity can be extremely challenging if a client has failed to make arrangements for

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