Is Time Your Ally or Enemy? 3 Ways to Make Time Your Estate Planning Ally

Whether time if your friend or enemy in your estate plan is a critical factor in whether you and your family will be protected. In this article, I explore the 3 ways you can have time be your friend and ally.

Recently, David Scott wrote in in his article about business succession planning about time as an ally or enemy to the business owner contemplating succession planning. Mr. Scott's points are well taken and apply equally to estate planning.

Time is your ally when you use time to get things done before they are needed. Any part of your estate plan, your Will, Durable Powers of Attorney, potential trusts for children etc. are all examples of documents that you may not  need until later. However, they are all documents that you can't create after they are  needed. If you get them done now, time is your friend and ally. If you wait too long, time is your enemy because you are out of time and you and your family are in trouble--it's too late to do the planning.

By doing your estate plan before it is needed, you and your family are protected against unplanned and unexpected emergencies, accidents and illnesses. That's the reason to do IT NOW! Then the plan is done, it is in place and you have used time wisely--as an ally.

Whenever you wait and procrastinate time is always your enemy. A need can arise, the family is in crisis mode or worse, chaos and it was all preventable. Solving the need is more difficult, more complex and always more expensive.

3 Ways to Have Time be Your Friend and Ally:

1. Start your estate plan now. Do it and get it done before any need arises. Starting now is easy, and will save you and your family money, heartache and TIME later. There are numerous articles here that discuss the specific components and documents your estate plan requires. Also, my firm's website has a good section on estate planning you should read.

2. Complete your plan soon after starting. I have heard stories from clients about having started a plan with a different adviser and not receiving drafts or documents for months. This is not how estate planning is done when done properly. Even complex estate plans can be designed, drafted, signed and funded in days to a few short weeks. As part of this second step, make sure assets are titled correctly and your beneficiary designations are drafted correctly.

3. Review your plan. Even after you create your plan, you want to make sure, from time to time, it does what you want. Follow the review schedule suggested by your estate planner. Staying current with changes in your family, property and the law makes time your ally.

Time can be either your friend or your enemy. The choice is yours and hopefully with these three steps, you can choose wisely. Good luck.

Please join our conversation and leave a comment or send me an email with your thoughts and ideas. Thank you.

Bernie Greenberg

Tax Law Permanence? No Chance!

Tax Law Permanence is Never Permanent

Recently, well just three months ago, Washington presented us with a brand new tax code called the Taxpayer Relief Act of 2012 or TRA.. This new law changed our income, estate and gift tax systems entirely. One of the features of this new tax law was supposed to be it's permanence. Well, the tax law is permanent no longer.

The TRA of 2012 brought new tax rates and exemptions. It was designed to create permanence and certainty to allow you to plan your financial affairs and estate without having to redo everything from year to year. This is now going up in smoke (the whole tax law looks like smoke and mirrors anyway) with the President's new budget proposal.

The new budget would do many things to our tax code and all of them are bad. Here is a sample list of just a few of the negative and adverse changes proposed:

1. Reduction in exemptions used in estate planning to 2009 levels.
2. Increase in tax rates for estate and gift taxes to the highest levels, 55%.
3. Extreme restrictions on the use of IRA's and similar savings tools.
4. Elimination of the ability to stretch inherited IRA payments over the lifetime of a beneficiary other than the surviving spouse.

While the budget proposal would do many, many more things to our tax code, this short list should be enough to alarm everyone what may be coming. Please remember to not shoot the messenger and consider writing your Congressional representatives to express your feelings about the proposed changes.

Also remember, if the budget proposal passes, it will be time again to review your planning and make appropriate changes. Please let me know if you have questions about these changes and how they impact you.

Also, please join in our conversation and post a comment here or to me via email about this or any of our estate planning topics.

Bernie Greenberg

The Pace of Change: Embrace It!

If you want to know how fast things change these days just blink. Not only is change constant, the pace of change seems to keep accelerating. As a lawyer advising clients about estate planning and estate and trust matters, I can tell you that clients find this challenging.

The pace of change in our legal system is quickening. Just this year alone, from Colorado's new Civil Union  law to the federal Taxpayer Relief Act of 2012 to the U.S. Supreme Court's consideration of DOMA, our entire legal landscape is not only changed, it is brand new.

This article is not to address these changes individually, but simply to draw your attention to your numerous blinks, each one resulting in significant change. Now that I have some of your attention, I want you to ask, "what do I do and how do I embrace all these changes?"

The answer to these questions has philosophical, emotional, quantum and physical elements. I'm going to take only one--the legal element. In the past three months the world of estate planning has been turned upside down. What was considered elemental last year is no longer. What was never considered possible is now the new normal.

In estate planning, there is one tried and true way to keep pace with the pace of change. Review, review, review. The only way to stay on top of changes is to periodically review your plan, with your estate planner in light of personal changes, legal changes and financial changes. Are you doing this? When was the last time you reviewed your planning.

Here is a good rule for 2013: if you last reviewed your plan prior to 2010, it is time for a review meeting NOW! The longer you wait, the more your plan will be out of synch. And there's one true thing about our legal system, it is not like fashion. You know fashion, just wait long enough and that "old" syle is back in fashion! Well, not so with our laws. As our society evolves and changes, our laws do as well. Unlike Alice, you can't click your heels and go back.

Yes, the pace of change is faster than ever and is not going to slow down. That is like getting in front of a train and trying to stop it. That would take a super hero with super powers. Instead, just keep pace with the pace of change and review, review, review.

Let me know your comments and join in our conversation. How do you feel about the pace of change?

Bernie Greenberg