Tuesday, September 15, 2015

Estate Planning for Your High School Graduate? Yes!

So your high school graduate is off to college or soon to be? Congratulations and best wishes to your graduate!

In addition to all the things you have thought of and stressed over, have you also remembered the estate planning documents that are a must for everyone over the age of 18? Chances are you need several additional items you may not have thought of.

Why estate planning for your graduate is important:

This article is a good discussion of the basic estate planning documents any high school graduate should have. These are:

1. Durable Power of Attorney.

2. Health Care Durable Power of Attorney.

3. Advance Directive or Living Will.

4. HIPAA Release.

Article on estate planning for your graduate.

In case reading the article is too tedious, here is a short video where I discuss estate planning for your graduate:

 Make sure your graduate has what they need to be successful and safe at school.

Let me know if you have any questions about obtaining these documents for your graduate. You can call me at 303-688-3535 or email me at: bgreenberg@kgattys.com

You can also visit our firm's website at: www.kgattys.com

Thank you for your interest.

Bernie Greenberg

Friday, September 4, 2015

The New Estate Planning: It's All About the Family!

What is Estate Planning Really About?

Are you like 70% of the folks out there who don't like to think about or hear about wills, trusts and estate planning? Well, if you are, don't fret. Many people believe that estate planning is only for the rich. Not only is that false, wills and trusts actually do more to protect people who don't have millions of dollars and property.

Why estate planning is not for the rich folk!

As the preceding article from one of the top companies in the world reveals, estate planning is about your family. Creating certainty, protecting your spouse and loved ones, protecting children, it's ALL about your family.

So how did the myth start that estate planning was only for the rich? It dates back to when the federal exemption against the federal estate tax (some call it the "death tax") was very low. Do you know the history of this exemption? The exemption is used by the government to define when YOU are wealthy (rich) enough to have to pay estate tax when you die.

The History of the Federal Estate Tax:

Thanks to the good people at Cook & Cook, here is the history and it's shocking.

History of the federal estate tax exemption and rates:

Let's start with the year 1978, the year I started practicing law. The federal estate tax exemption (the definition of wealthy) was a mere $134,000! If your estate was greater than $134,000, you paid federal estate tax and if you look at the chart, the marginal rate of that tax was a horrifying 70%! As you can see from the chart, the exemption has increased over time, not even coming to close to keeping up with the economy or inflation.

So here is where the myth about estate planning started--we were all concerned as estate planners with reducing or avoiding this tax, the highest tax ever imposed on citizens of our country. When the exemption was low, the focus was estate tax planning. Most people were so incensed about the estate tax that they didn't pay proper attention to the real reason for estate planning--protecting the family.

The Federal Estate Tax in 2015:

So where are we today? In 2015, the exemption against the federal estate tax is $5,430,000 and is scheduled to increase in 2016 to approximately $5,515,000! Now that's more like what someone would expect as a real definition of wealth.

With the exemption against the estate tax at this level, the old, historical focus on estate tax planning is less relevant for most families. As you might think, far fewer families have estates over $5,430,000 than that old exemption of only $134,000. Because the exemptions are at historically high levels, the focus for most families is on protecting the family.

Most common is the desire to protect the spouse, then children and then other family members. I have always believed that protecting family should always be the driving reason for a client's estate planning and this focus should be reflected in documents such as wills, trusts and powers of attorney.

Good estate planners never let the tax tail wag the family dog! That's a good rule of thumb to remember when you think about your estate plan. Just because taxes are not a concern doesn't mean that we don't care about our families. We do and here are three short videos that illustrate just how important this is.

Estate planning for young families:

Estate planning for children over 18:

Estate planning for blended families:

So when someone says to you, "I don't have enough money to do a will or estate plan" share this article with them so they can have the full story.

Let know your thoughts on this and please join our conversation by commenting or sending me an email. Thank you for your interest.

Bernie Greenberg

Monday, July 6, 2015

Why There Really Is No Such Thing as a Simple Will

Yes, it's true, there is no such thing as a simple will. Here's why:

As a wills and trusts lawyer, I am asked every day about "simple wills". The interesting fact is that there is no such thing.

As is discussed below, when most clients ask for a "simple will" they believe they will save money, time and complexity. Unfortunately, the opposite is usually true. Simple wills are a misnomer because they simply don't exist once EVERY client asks themselves several questions. More on those later.

The most important that there are no "simple wills" is the differences between families. While this should be evident, many people pretend there are no differences. Let's start with just two families which appear below.

Especially today, family has an expanded meaning. EVERY family is different from every other family. In the first picture, our family includes the parents of one spouse while in our second picture, the family structure is different. Your takeaway is that every family is different, every client is different meaning that every family's estate plan will be different.

Here are the questions to ask to see if your will should be like your neighbor's will:

1. Are you married to the same person?
2. Are your medical situations identical?
3. Do you have the same children with the same needs and medical histories?

As you can see, it is impossible for different families to be the same.

To an estate planning attorney like myself, this concept is fundamental. However, I can't tell you how many wills I have had to fix when a client tried to copy a friend's will or one from the internet. If your family's individuality is not considered in your will or estate plan, how do you know that plan will work? The answer is that you cannot.

The essence of estate planning is the uniqueness of your family and this is why your will, your trust and your estate plan will not look like your friend's or neighbor's. In the article below by attorney, Robert Fleming, these concepts are discussed as Fleming explains why there is no such thing as a "simple will".

The Myth of the Simple Will

Let me know if you agree or if you have any questions about this or any of our articles as we explore the world of wills and trusts and estate planning. Thank you.

Bernie Greenberg