Why You Need an Estate Planning Checkup

Good for you, you have a will! How long has it been since you looked at it? Do you even remember where you’ve stored it?

Dig it up now. Take a look at when it was signed. Was it two years ago, five years ago, ten years ago, even more?

Now read it. Was the will signed in a different state? You need to consult with an estate planning lawyer to determine whether your existing will complies with New Jersey law. If it does not, it is not valid.

Is this still the way you want your estate distributed? If you have acquired a larger estate since when you signed your will (yes, even with the latest financial crisis), your estate may be large enough so that your estate might be subject to New Jersey estate taxes. Since the threshold is $675,000, a lot of people who thought they were not subject to any estate taxes should talk to their estate planning lawyer.

If you have minor children, did you name a guardian? Do you still want that person to act as guardian? Is the guardian still willing to take on this responsibility?

Have you become married, divorced, or widowed since you signed your will? If you are married, your spouse is entitled by law to a percentage of your estate, even if the spouse isn’t mentioned. But, do you want your spouse to inherit everything? Then you need to revise your will. If you have become divorced, did you change your will to ensure that your ex-spouse gets only the amount you wish to give him – or do you want to cut him out completely?

Is your power of attorney more than five years old? Although a durable power of attorney does not have an expiration date, as a practical matter, banks and other financial institutions have a reluctance to rely on an old document. This means your agent (the attorney-in-fact) may have difficulty using the powers that you gave her. You might want to re-execute a new durable power-of-attorney and think about whether you want to appoint the same agent.

Likewise, is your health care proxy more than five years old? Does it give your health care agent permission to review your medical records? Do you still want to name the same agent? Do you give your agent instructions in a living will as to your wishes for medical treatment if you are terminal or in a coma? These are all very good reasons to call your estate planning lawyer to re-do your health care proxy and living will.

Your estate plan changes as your life changes. Revisions in the tax laws are also a reason for a change in your estate plan. Don’t think that because you had your estate plan created once that you are done forever. You should have an estate plan check-up every 2-3 years.

Do You Think You Don’t Need Estate Planning Just Because You Are Single?

When estate planning is talked about, most people visualize the old-style American family – either the Cleavers or Ozzie and Harriet and the boys. You may think as a single person that you don’t need estate planning. But you’d be wrong.

There are many of you out there who never married, got divorced, or are widowed. All of you need estate planning documents. In some respects, you need them more than married people do. After all, if you have a sudden heart attack, the doctors and nurses would ask your spouse about what your wishes would be, even without a health care proxy. And without a will, your spouse would inherit at least a portion of your estate.

But, if you are not married, the laws of New Jersey intestacy (dying without a will) dictate who will inherit your estate. This law may create heirs that you never intended. If you have no children, siblings, nieces, nephews, and their children can inherit your estate. What if you wanted everything to go to your favorite charity? Or to your significant other of five years whom you have no intention of marrying? Without a will, the charity never gets a dollar of donation and your significant other receives nothing. Also, there are fewer ways to save on New Jersey estate taxes when you are single so you want to consult with an estate planning lawyer to ensure that you become informed about every technique that is out there to save on taxes.

You need a durable power of attorney to appoint someone that you trust to handle your financial affairs if you cannot do so for any reason. Many times, married couples will have joint bank accounts so one spouse can handle the finances even if the other one is out of town or in the hospital. Do you have any joint accounts? As a single person, probably not. And I’m not recommending that you set up a joint account for emergencies. I suggest that you sign a durable power of attorney, appointing someone that you trust to handle your money. This will allow an adult child, trusted relative, or a cherished friend to pay your bills, ensure that you have enough cash in your accounts to make those payments, and to maybe handle any job benefits that you may be entitled to because you are incapacitated. But, if you don’t appoint someone yourself through a durable power of attorney, the person who cares about you must go into court and spend the time and money to get appointed as your guardian.

Just as you need someone to handle your financial affairs, you need to appoint someone to handle your medical issues. You want to discuss your medical choices with a person that you trust and voice how you would want different scenarios handled on your behalf. For example, if you were in an irreversible coma, would you want a breathing tube, nourishment, or heroic measures if your heart stopped. Or would you want the doctors to do everything in their power to keep you alive since you believe that God will take you when you are supposed to go? By appointing someone to act for you as your health care proxy, and letting them know what you would want, you will get the medical treatment that you wanted and don’t get the treatment that you would have refused if you could talk.

Please feel free to forward this blog to friends, family, colleagues, listserv members or other bloggers. Or if you would like to run it (in whole or in part) in any publication or quote from it, simply include Robin Gronsky’s name and URL: www.Gronskylaw.com. No prior permission needed. To inquire about Robin's availability to speak to your group or write an article for your publication, please email her at RGronsky@Gronskylaw.com. Thank you!

Can Using an Online Will Form COST Your Loved Ones Money?

Times are hard, you don’t want to spend money for a lawyer, you think you don’t have too many assets. So you figure you’ll just go on the internet or maybe get a book out of the library and get a will form really cheap. You fill in the blanks, sign it, you believe that you have the correct number of witnesses, and feel very proud of yourself for doing your estate planning. Then, you die, and you don’t realize that your do-it-yourself will has serious problems with it. You will never know that your loved ones are in court spending money on lawyers to fix the mistakes that your will contains.

What kinds of mistakes can internet and wills and trust forms from a book create? Do you know if the form you are using incorporates the latest changes to the law? You don’t want to use an out-of-date document but how do you know if it is out-of-date?

Did you decide that because you’ve heard so much about those revocable living trusts that you should have one? Did you get an online form and create your own trust? Did you put any of your assets in the trust? Did you know you even needed to put your assets in the trust? If there are no assets in the trust, it is the same as if it never existed. If you are an expert in estate planning, you may know exactly what you are doing when you draft legal documents. But, more likely, you are following instructions from a website or a book and you have no idea if you are doing things correctly. Would you do surgery on yourself? Most of us would consult a doctor and for good reason. An expert knows what to do. You should consult an expert, not the internet.

Are you sure that the forms follow your state’s laws and requirements? How do you know for sure? Forms on the internet and in books may not be good for your state. Each state has its own requirements of how many witnesses are required and whether a notary public is required. If you don’t get everything exactly perfect, the court will throw out your will and your relatives will be in court fighting over who gets your estate.

Does your will form state that the executor does not need to post a bond? If you do not specify this requirement, your executor needs to buy a bond which costs hundreds or thousands of dollars. This bond insures that your executor will act in accordance with the terms of your will. You can state in a will that your executor does not need to post a bond, but if this language does not appear in your will, it is not implied. It must be explicitly stated.

Are you different from your neighbor, from your best friend? Do you think a will from the internet or a book should create a different estate plan from your neighbor's or your best friend's? Everyone has her own special set of circumstances. A cookie-cutter will can’t necessarily cover your situation and you won’t know that your will is deficient until the court throws it out.

Lessons that You Can Learn from Michael Jackson's Will

When Michael Jackson died, there was a great deal of conversation in the media about who would inherit his estate. It was believed that he had over $400 million in debts but that when his assets were sold or invested, that he would have about $500 million in his estate. Most of the “experts” on television thought that he would not have a will and that there would be a court fight between his mother, who quickly proceeded to get herself appointed as the administrator of his estate, and Debbie Rowe, who is the mother of two of his children (and his children would be his heirs under California law). It was something of a surprise when a will that was signed in 2002 surfaced and was admitted to probate. This will ended all of the speculation of how his estate would be distributed. In addition, the will named who he wished the court to appoint as the guardian of his children and named a back-up guardian in case his first choice would not or could not serve.

Since the will was submitted for probate, it became a public document and can be viewed here: http://www.docstoc.com/docs/8016703/Michael-Jacksons-Will

The will is fairly short and gives Jackson’s entire estate to the trustee of the Michael Jackson Family Trust. Since the trust agreement was not attached to the will, the world will never know exactly how the estate will be distributed.

What does the Michael Jackson will teach you about estate planning? First, there will be no squabbling among your relatives and others if you have a will. A properly signed, witnessed and notarized will that is submitted for probate will dispose of your assets as you wish, not as your family, or ex-relatives, or the lover that you never married, or a probate judge wishes.

Secondly, if you do choose to create a trust, the rest of the world will never find out how you wished to have your estate distributed. For some of us, that is an important consideration, for others, they don’t care because they believe they have nothing to hide. This will also shows us that if you set up a trust, you must re-title all of your assets into the trust. This is because if you have no assets that you own as an individual, then you don’t need to probate a will. Unfortunately, most people who create trusts do not remember to put all of their assets into the name of the trust. So they must have a will and submit that will so the assets that were not in the trust can be distributed the way that you want.

And thirdly, someone, hopefully the executor that you have chosen, knows where the will is located so that it can be probated. If you have had a will signed but cannot remember where you have stored it, then it is as if you had never signed the will. Once you have signed your will, keep it in a safe place and tell your executor and successor executor where you are putting it so that they will know where to look when the time comes.

So, here are three estate planning lessons to learn: 1) have a properly drafted, signed, witnessed, and notarized will; 2) if you have a living trust, make sure that all of the assets that you own, either as an individual or as a tenant in common, are re-titled into the name of the trustee of the trust; and 3) make sure that your executor and successor executor know where your will is located and can get the original to submit to the court.

Please feel free to forward this blog post to friends, family, colleagues, listserv members or favorite bloggers. Or if you would like to run it (in whole or in part) in any publication or quote from it, simply include my name and URL: http://www.mortgagelicensesolutions.com. No prior permission needed. To inquire about joining my list to receive my blog posts or my availability to speak to your group or write an article for your publication, please email me at RGronsky@Gronskylaw.com. Thank you!

Lessons from Michael Jackson’s Death – the Guardian Issue

Michael Jackson died a week ago and provided the world with a great lesson in estate planning. There was a lot of speculation from “experts” and anyone with an opinion on who should be the guardian of Michael Jackson’s three children. The opinions ran one way before Michael Jackson’s will was filed for probate and ran slightly differently afterwards. But there was a certain amount of agreement which should make every parent who has children think or re-think who they have appointed as a guardian for their children if they die young.

Michael Jackson had a very unusual situation with his children. He was divorced, his second ex-wife, who may or may not be the biological mother of his two eldest children (but is legally their mother because she gave birth to those children) possibly gave up her custody rights when she divorced Jackson, and there is a third child, whose mother is unknown. If Jackson didn’t have a will, it was predicted that there would be a huge fight for custody of the three children among the biological mother of the two eldest children, Michael Jackson’s mother, and the nanny who spent many years with the children. The three children could conceivably have been sent to live with different guardians. Because Jackson had a will, naming his mother as the guardian of all three children, the discussion has shifted.

Now, the speculation is whether the mother of the two eldest children will ask the court to be appointed as the guardian of her two children, even if she signed away her rights as a parent. Custody of the third child does not seem to be up for grabs. Michael Jackson’s mother, who was named as the guardian of all three children in the will, will remain as guardian of that child. So, if Michael Jackson named his mother as guardian of all three children, why is there any question as to whether she will remain as guardian of all three?

The answer is that the courts grant custody to the natural parent of a child unless the parent does not want custody or the court finds that the parent is unfit to be a parent. The standard is normally “the best interests of the child” but the natural parent still gets the benefit of the doubt.

What is the lesson for all parents? It is better to name a guardian in your will than to die without a will naming a guardian. Although Michael Jackson’s situation is very unusual, it is common for guardian issues to arise in blended families. Your children with your former spouse will live with him even if your current husband is very willing to raise those children. This is true, even if your ex-husband has barely been involved in his children’s lives. But, if your ex-spouse does not wish to assert his parental rights, the person you name as your children’s guardian will get appointed by the court and will raise your children, as you had wished.

Please feel free to forward this blog post to friends, family, colleagues, listserv members or favorite bloggers. Or if you would like to run it (in whole or in part) in any publication or quote from it, simply include my name and URL: http://www.Gronskylaw.com. No prior permission needed. To inquire about joining my list to receive my blog posts or my availability to speak to your group or write an article for your publication, please email me at RGronsky@Gronskylaw.com. Thank you!