Author: Kylie Casper

Celebrity Estate Plans Series Part 4 of 4: Elvis and the Scammers

Post author By Kylie Casper
Post date August 15, 2024
No Comments on Celebrity Estate Plans Series Part 4 of 4: Elvis and the Scammers

For the last few weeks, we’ve discussed celebrities and how they planned for their deaths. We started with the King of Pop, Michael Jackson, so ending our 4-part series with the King of Rock, Elvis Presley, seems fitting.

Why discuss a man who’s been deceased since 1977? A recent case involving Graceland serves as a stark reminder of the audacity of scammers. This case is a wake-up call for property owners and potential heirs. Let’s delve into this unusual tale to understand how you can assert control over your assets and protect them from unscrupulous actors.

How It Went Down

You might think that a well-known property like Graceland would be untouchable, but that didn’t stop a mysterious company from trying to steal it. A group calling itself Naussany Investments and Private Lending claimed that Graceland’s owners owed them millions from an old loan. They even set a date to auction the property to the highest bidder. But there was just one problem – the whole thing was a scam.

Riley Keough, Elvis’s granddaughter and the current owner of Graceland, quickly fought back. She filed a lawsuit, saying her mother, Lisa Marie Presley, never borrowed money from this company or put Graceland up as collateral. The courts agreed, stopping the sale just in time. Keough’s swift action got the attention of the Tennessee Attorney General’s office, which then turned over the case to the FBI, and a federal investigation is pending.

Unfortunately, there’s been a rise in these types of scams, and they aren’t just targeted at the rich and famous. Scammers can take advantage of those who have never had a top-10 hit. A Wall Street Journal article published on June 3, 2024, breaks down a typical scenario, which is on point:

“Here’s how it works: A fraudster targets your house and assumes your identity, using tactics similar to identity thieves to acquire your personal information and create fake IDs. He or she then tries to sell it to an unsuspecting buyer by executing a forged deed in your name. An alternative scam is to submit a mortgage application in your name to get cash out of the house.”

Often, people don’t find out this has happened until the sale is complete, and by then, it may be too late to get the property back—or at least it would be very time-consuming and costly. Some people cannot fight back because they don’t have the financial resources to do so, and the results can be utterly heartbreaking.

If it can happen to Graceland, it can happen to anyone. So, how can you identify these scams before they escalate? The key is knowledge. Equip yourself with the right information to spot these scams before they become a threat.

Red Flags You Can’t Ignore

When you’re dealing with property, loans, and estate planning, keep your eyes peeled for these warning signs:

Paperwork problems: The documents in the Graceland case had many issues. The dates didn’t match up, the signatures looked fishy, and the notary said she never met Lisa Marie Presley. Always read the fine print and question anything that looks off. You should also consult with a lawyer immediately if you suspect something fishy. A lawyer can confirm your suspicions and help you take action right away.

Ghost companies: According to the news articles, Naussany Investments was hard to pin down. They had no actual address, just P.O. boxes, and weren’t registered as a business anywhere. Do your homework before you deal with any company, especially for something as important as a loan. Look them up online, check with the Better Business Bureau, and be bold and ask probing questions.

Timing: The scammers waited until after Lisa Marie Presley passed away to make their move. Be extra cautious about any claims against a deceased person’s estate – fraudsters often target families when they’re most vulnerable.

Steps You Can Take to Protect Yourself

Understand that you can take proactive steps to safeguard yourself and your loved ones before any warning signs appear. Here are some practical measures to ensure the protection of your property.

Keep good records: Make sure all your important documents are organized and easy to find. This includes property deeds, mortgage papers, and any loans you’ve taken out. If someone makes a false claim, you’ll have the proof to fight back as quickly as Riley did. Regular review and updates of these documents are crucial.

Be skeptical: It is if something sounds too good to be true. Be wary of unsolicited offers or demands, especially if they come with pressure to act quickly.

Stay in the loop: If you’re inheriting or managing property for someone else, know what’s happening. Are the taxes paid? Is there a mortgage? The more you know, the harder it is for scammers to pull a fast one. Riley Keough was able to take action quickly enough to stop the sale because she was paying attention.

You also want to make sure someone else is paying attention to your affairs in case you become incapacitated. In last week’s article, we discussed what can happen if you become incapacitated and you haven’t planned for it. If you missed it, here’s a sneak peek: it took months for Jay Leno to be able to manage his wife’s financial affairs once she was unable to herself. And as we’ve seen with the Graceland case, months could mean the difference between keeping your property and losing it. If you haven’t planned for your incapacity, book a call with me using the scheduling link below, and let’s talk about how we can get that taken care of for you.

This brings us to the most important thing you can do to protect yourself. Incapacity planning isn’t enough. You need a solid and thorough Life & Legacy Plan.

A Solid Estate Plan is the Key

A solid estate plan creates a legal framework that’s much harder for fraudsters to penetrate. The type of planning I do, called Life & Legacy Planning^Ⓡ, is solid and thorough. It covers all possible scenarios so you and your family are prepared for anything that can happen after your death or during your incapacity. It includes an inventory of all your properties and other assets, so you know exactly what you have, and your loved ones will also know if they need to step in and help. A Life & Legacy Plan also includes regular reviews and updates so your plan stays current with changing laws and circumstances, closing potential loopholes that scammers might exploit.

Finally, we can help you ensure your loved ones are aware of these risks and familiar with your estate plan. As we’ve learned from Elvis’s estate, the more eyes watching out for fraud, the better.

How We Help You Not Fall Victim to a Scam

Scams are rising, and the best time to protect yourself is now. We help you create a Life & Legacy Plan so that your loved ones stay out of court and conflict and have a plan that works when you (and they) need it to. Once you’ve created your plan, you can rest easy knowing your wishes will be honored, your loved ones cared for, and your property protected.

Schedule a complimentary 15-minute consultation to learn more. Contact us today to get started.

This article is a service of August Law, a Personal Family Lawyer® Firm. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life & Legacy Planning™ Session, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love.

The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.

Tags Celebrity Estate Plans, Elvis, Estate Planning, Graceland, Personal Family Lawyer, Scammers

Celebrity Estate Plans Series Part 2 of 4: Vanilla Ice Has Thoughts

Post author By Kylie Casper
Post date August 1, 2024
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This week, we’re continuing to look at the lives of 4 celebrities and how they’re preparing for the inevitable (or didn’t!). Last week, we examined Michael Jackson’s planning and the holes in his plan that resulted in his family being embroiled in court and conflict for 15 years and counting (if you missed it, go back and check it out!) in this second article of our 4-part celebrity series, Vanilla Ice chimes in with his estate planning experience, advice, and lessons learned on a video he posted to his YouTube channel. He has a lot to say!

Vanilla Ice (Really) Hates Estate Taxes

Vanilla Ice shares the story of his buddy Mark, whose parents owned a sprawling property in Palm Beach, Florida. When they passed, Mark and his siblings sold the estate, expecting to be set for life. However, estate taxes ended up taking over 80% of their profit. Ouch.

Vanilla Ice calls this tax a “generational wealth killer,” he’s not wrong. Estate taxes can sneak up and bite a massive chunk of your wealth. And the thing is, with a proper estate plan, this doesn’t have to happen! The key is to educate yourself. Knowing what you’re up against helps you plan smarter so that more of your hard-earned assets reach your heirs.

Education is the most important part of estate planning. That’s why my planning process begins with a Life & Legacy Planning Session, where you’ll get the plain and straightforward education you need to make wise decisions about your planning, including how to keep your family out of court and out of conflict, minimize taxes, and ultimately create a plan that works for you and the people you love, when they need it.

So, first lesson: if you suspect your family could pay estate taxes at your death, don’t wait to plan. There’s way too much at stake. Call us, and let’s get you to know about the kind of planning you want and need for yourself and the people you love.

Vanilla Ice Thinks Life Insurance is Cool

(“Ice” and “cool” – get it? Sorry, I couldn’t resist.)

Life insurance isn’t just for covering funeral costs – it’s a secret weapon in estate planning. Vanilla Ice suggests “maxing out your life insurance” to give your kids as much money as possible. What makes life insurance “cool” is that death benefits aren’t subject to income tax, meaning your heirs can get more bang for your buck than if you were investing the money you’d put into life insurance premiums into just about any other asset class.

It’s worth considering what Vanilla Ice suggests here. When you take out a life insurance policy, the payout can cover any necessary taxes, probate fees, and debts, ensuring your heirs receive the lion’s share of your assets. Life insurance can help with short-term needs, like paying off a mortgage, or it can serve your family’s long-term needs, like maintaining the lifestyle to which they’re accustomed.

When you get educated via our Life & Legacy Planning process, we’ll look at your life insurance, whether you have the right amount and the right type, and ensure you are 100% clear on what it might mean to “max out your life insurance” and if you really should do that. We’ll consider whether you need more insurance, less insurance, or a different kind of insurance based on your family dynamics, assets, and what you want for the people you love after you leave.

Second lesson: If you want to be cool, plan to buy the right type and kind of life insurance.

Ice Says Trusts Are Not Just for the Rich and Famous (and He’s Right!)

Trusts might sound like something only the super-wealthy need, but they’re an intelligent tool for anyone looking to protect their assets.

Ice mentions irrevocable trusts specifically. These types of trusts let you transfer assets to a beneficiary while removing the assets from your taxable estate, ensuring your assets aren’t subject to estate taxes. Any assets in an irrevocable trust are protected from legal judgments and creditors IF you do it correctly and in the right jurisdiction. If it’s something you are interested in, contact us, and we can talk. In the video, Ice jokes about putting his classic car collection into a trust and setting rules, such as his kids can lease but not sell the cars. This protection ensures your heirs benefit from it, but don’t squander the assets. In other words, even after death, you can determine how your assets will be used. And if you want to protect them for future generations, you can. This is one way to create generational wealth.

So now we’re up to our third and final lesson: If you want to protect and preserve your assets for generations, take Vanilla Ice’s advice and utilize trusts in your planning.

Put Vanilla Ice’s Advice Into Action Today

Vanilla Ice’s video brings forward lessons everyone can benefit from. By understanding your options, including how taxes and life insurance impact your family and assets specifically, and considering using well-counseled trusts, you can safeguard your assets and ensure they benefit your loved ones the way you want. To quote his classic hit, “Ice Ice Baby,” ‘Anything less than the best is a felony.’ Take these lessons from Vanilla Ice to heart, and start building a solid estate plan today. Your future generations will thank you for it.

We help you create a Life & Legacy Plan rooted in education and clarity so your loved ones stay out of court and conflict and your assets are protected. Once we’ve created your plan, you can rest easy knowing you’ve done the right things for the people you love most.

Tags Celebrity Estate Plans, Estate Planning, Estate Planning Attorney, Vanilla Ice

Estate Planning

Celebrity Estate Plans Series Part 1 of 4: Michael Jackson

Post author By Kylie Casper
Post date July 25, 2024
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What is it about celebrities that always draws us in? For whatever reason, we just can’t resist a good, juicy celebrity story. So, for the next few weeks, we will look at the lives of 4 celebrities and see what we can learn from their stories.

This week, we’re turning the spotlight on Michael Jackson. Even if you aren’t old enough to “Remember the Time” when Michael Jackson was dominating the charts, by the end of this article, you’ll see that he left holes in his estate plan that we can learn from.

Now, let’s dive in and learn how to avoid the same fate for your loved ones.

It’s As Easy as “ABC” (and 1, 2, 3)

Before we look at the specifics of Michael Jackson’s story, let’s dispel a myth about estate planning: You need not be rich, philanthropic, or famous to need estate planning. You need estate planning if you own anything – even a bank account – and have people in your life you love. It’s as simple as that (dare I say it’s as simple as “ABC” and 1,2,3?). So, as you think about your estate planning, it’s time to “Beat It” past the misconceptions so your loved ones can empower you to do the right thing.

Creating a Will Alone is a “Bad” Choice

So what happened in Michael Jackson’s case? His estate plan included a Will, which established trusts for his mother, Katherine, and his three children, Paris, Prince, and Bigi.

Let’s stop because this setup already has an increased potential for conflict.

When your assets pass via “Will” (instead of via Trust), your assets must go through a court process called probate. Subjecting your assets and your family to probate can result in a long, time-consuming, public, and messy court process that can be unnecessarily expensive to resolve.

A trust, on the other hand, bypasses the court process altogether as long as your assets are owned in the name of the trust when you become incapacitated or when you die. If your assets are appropriately transferred and retitled into the trust (called “funding” the trust), your estate can be administered privately and often takes less time than the court process. A trust can be set up and funded while you’re alive, thereby avoiding probate, or it can be a part of your Will. When it’s part of your Will, like in MJ’s case, it isn’t established or funded until after the court process. So, if you’re trying to keep your family from going through the court process, putting a trust in your Will completely defeats the purpose.

Since Michael Jackson’s assets passed via a Will, there have been ongoing legal matters in court, which still haven’t been resolved in the 15 years after his death. MJ’s family is embroiled in a dispute with the IRS, so the trusts he intended to create for his mother and children remain unfunded. Therefore, some of his assets cannot be transferred to them as he planned. It’s also highly probable that the legal disputes continue to cost the estate a lot of money. That’s money that otherwise would have gone to his mother and children.

Taxes – A Potentially “Dangerous” Situation!

The Jackson estate’s ongoing battle with the IRS is a stark reminder of the tax implications that can affect your plan and your loved ones. When it comes to taxes, you can’t think in terms of “Black or White.” If you intend to avoid as many taxes as possible, you don’t want to cut corners by doing your estate planning cheaply or independently. That could be “Dangerous!”

Taxes can significantly reduce the value you pass on to your heirs, directly impacting your loved ones. So, our next lesson from Michael Jackson’s story is that the stakes are too high to attempt alone when it comes to saving money on taxes. Work with a professional who can advise you properly. We aren’t clear why Michael Jackson didn’t get the support necessary to minimize taxes and protect his estate from a long, drawn-out court process, but we know we can help you and your loved ones.

Avoiding the “Thriller” of Legal Disputes

The Jackson case also highlights the importance of choosing the right representatives for your estate. These are the people who handle your affairs after you’re gone (they’re called “executors” if there’s a Will or “trustees” if there’s a Trust). MJ’s family members have criticized the representatives for the way they’ve managed the estate. In particular, Katherine Jackson has alleged that the executors have been too frugal and are holding onto assets to maintain control.

Conflict between your representatives and your loved ones is always possible. To help minimize the potential, we recommend you communicate your intentions to your representatives and loved ones during your lifetime. Consider holding a meeting so everyone knows your wishes and understands the intent behind your decisions. You may not be able to “Heal the World” on your own, but you can promote healing within your own family and prevent future conflict by opening the lines of communication now.

Also, know that you don’t have to choose family members to be your representatives – even if you feel pressured. If you aren’t sure who the “right people” are, think about people you know who are trustworthy and capable of handling complex financial and legal matters. There’s also the option of choosing a professional representative, as Michael Jackson did, who might be more appropriate for your situation.

Our two final lessons from Michael Jackson’s story are: 1) Communicate your wishes openly to your representatives and your family, and 2) Choose the right people to act for you when you no longer can.

“You Are Not Alone” – We’re Here for You

By learning from the challenges faced by Michael Jackson’s family, you can ward off the possibility of a similar outcome for your loved ones. Your careful planning today can pave the way for a smoother transition of your assets in the future, ensuring that you can support your family after you’re gone rather than creating a mess for them to handle without you.

It’s “Human Nature ” to want to avoid thinking about your death, much less plan for it. We get it. But we can live a more fulfilling life when we face our mortality. The good news is that you don’t have to deal with it alone. We’re here to support you every step of the way.

We help you create a comprehensive Life & Legacy Plan from a place of education and intention so that your loved ones stay out of court and conflict and you can minimize taxes. Once you’ve created your plan, you can rest easy knowing your wishes will be honored, your loved ones cared for, and your legacy preserved.

Schedule a complimentary 15-minute consultation to learn more.

Tags Celebrity Estate Plans, Estate Planning, Michael Jackson, Personal Family Lawyer

Estate Planning

The Surprising Connection Between Men’s Health and Estate Planning

Post author By Kylie Casper
Post date July 18, 2024
No Comments on The Surprising Connection Between Men’s Health and Estate Planning

As you may know, June marked Men’s Health Month, a time dedicated to raising awareness about health issues predominantly affecting men and encouraging the early detection and treatment of disease among men and boys. Gentlemen, you already know that taking care of your health allows you to prolong your life and enhance your quality of life. But have you seriously considered how your health directly impacts your future? Your legacy? The ones you love the most?

What we’re talking about here is estate planning, a comprehensive process that involves the management and distribution of your assets during your lifetime and after your death. It’s every bit as important as your physical health. I know, I know, it could sound weird to equate health with estate planning, but hear me out. By the end of the article, the connection will be clear.

The Link Between Your Health and Estate Planning

Estate planning often brings to mind wills, trusts, and other legal paperwork, which may be what you initially thought when you read the title of this article. However, I want to challenge that assumption with this: the documents are merely the byproduct of estate planning.

Estate planning focuses on ensuring your wishes are honored if you become incapacitated so you can live and die with dignity, as well as protecting your legacy.

What about health? How does your health connect with estate planning?

Your health plays a significant role in shaping your preparations for the future in general and how you structure your estate plan in particular. While “health” can refer to emotional, health, and spiritual health, and all are important, we’ll focus on physical health here. .

Longevity and Retirement Savings. Your physical health directly impacts your lifespan, affecting how long your retirement savings need to last. For example, if you maintain good physical health, you’re likely to live longer (yay!) and will need a more extensive plan regarding your assets for your longer life.

Healthcare Decisions. Consider the potential need for long-term care. Alzheimer’s or dementia could require long-term care solutions that you may or may not choose. Your estate plan is to ensure you’re financially covered for these possibilities and to make it clear how you want to be cared for if you cannot make decisions for yourself. There is a time when it’s too late for you to make your wishes known. By making these decisions now, you are taking control of your future health and care, and ensuring that your wishes are respected and followed.

This is why you need a healthcare power of attorney or a living will in your plan. A living will is a legal document that outlines your preferences for medical treatment if you are unable to make decisions for yourself. These documents designate the person (or people) you choose to make medical decisions on your behalf if you cannot. Your designated healthcare agent (or agents) only ensure that your healthcare preferences are respected and that your medical treatment aligns with your wishes. Without these documents placed, a judge (stranger) could appoint someone to act on your behalf. Maybe even someone you don’t trust or wouldn’t make making decisions for you. In a worst-case scenario, a judge could even appoint a professional conservator who could drain your estate financially.

Disability and Its Impact. Poor health can sometimes lead to disability, affecting your ability to manage your affairs. Including a disability clause in your estate plan ensures that your assets are managed according to your wishes, and you can oversee them personally. A disability clause is a provision in your estate plan that outlines how your affairs should be handled if you become incapacitated. A revocable living trust is helpful here, as it allows your chosen person or entity to manage your affairs without needing court intervention. Again, with a plan in place, a judge will make decisions for you that may differ from what you want.

Having gone through the potential consequences of not prioritizing your physical health and its direct link to your estate planning, let’s turn to practical steps you can take now to make sure you and your family don’t have to experience any negative consequences.

Practical Steps to Integrate Health and Estate Planning

Unless you’re already incapacitated and can’t make decisions for yourself, know that it’s not too late to take action. It’s not too early, either. Death and incapacity don’t discriminate based on age. When you face the facts and plan accordingly, you can live life more quickly, joyfully, and less stressed. Truly. By taking action now, you are being proactive and ensuring a better future for yourself and your loved ones.

So if you haven’t planned for the future, here are some practical steps you can take now:

Schedule Regular Check-Ups. It may seem obvious, but regular medical examinations are vital to help detect illnesses early and provide a clear picture of your health, which, as discussed above, is crucial for accurate estate planning. If you discover a new health condition, you can plan accordingly when you’ve caught it in time. If not, it could be to implement your plan place.

Update Your Estate Plan Regularly: As your health changes, so should your estate plan. Make it a habit to review and update regularly or whenever there is a significant change in your health. I can help you get your initial plan in place with a unique process I use called Life & Legacy Planning®, and I will always include a free review of your plan at least every three years. This ensures your plan works because it will be updated as your health, life, and assets are on time. Without updates, your plan will fail, sending your family to court and increasing the probability of conflict.

Discuss Your Plans Openly: Talk with your family about your healthcare wishes and how they relate to your estate plan. Taking this courageous, and maybe uncomfortable, step makes a big difference in decreasing the likelihood of conflict in your family. Discuss your preferences for end-of-life care, which can create conflict in your family if you haven’t clarified your wishes.

Consult A Professional Who Has Your Best Interests in Mind: I approach estate planning from a place of heart, always keeping your best interests, and by extension, your loved ones’ best interests, in mind. I help you get your plan in place but also help you keep your family out of court and conflict so your legacy is one of love and care. I can also help you navigate difficult discussions with your family about your wishes so you can feel confident knowing you’ve done all you can to preserve the family bonds.

How We Support You and Your Loved Ones

We recognize the integral connection between your physical health and estate planning needs. Our commitment goes beyond legal documentation; we ensure your life’s work is served with dignity and clarity. By understanding the specific challenges and opportunities that arise from your health, we tailor estate plans that protect not only your assets but also your well-being and your family’s future. Take a proactive step toward safeguarding your legacy and enhancing your peace of mind. Contact us to learn how our Life & Legacy Planning® process can align your health priorities with your estate planning goals. Schedule a 15-minute consultation to discuss your next best steps.

Tags Advanced Health Care Directives, Benefits of Professional Assistance in Estate Planning, Estate Planning, Men’s Health, Power of Attorney, Role of a Personal Family Lawyer in Estate Planning

Estate Planning

Long-Term Care Insurance: What You Need to Know

Post author By Kylie Casper
Post date June 5, 2023
No Comments on Long-Term Care Insurance: What You Need to Know

With the booming aging population, more and more seniors will require long-term healthcare services, whether at home, in an assisted living facility, or in a nursing home. However, such long-term care can be extremely expensive, especially when it’s needed for extended periods.

Moreover, many people mistakenly believe that their health insurance or the government will pay for their long-term care needs. But the fact is, traditional health insurance doesn’t cover long-term care. And though Medicare does pay for some long-term care, it’s typically limited (covering a maximum of 100 days), difficult to qualify for, and requires you to deplete nearly all of your assets before being eligible (unless you use proactive planning to shield your assets).

To address this gap in healthcare coverage, long-term care insurance was created. Since such insurance is fairly new, we’ll answer some of the most frequently asked questions about these policies to help you determine whether you (or your loved ones) could benefit from investing in long-term care insurance coverage as part of your estate plan.

What is long-term care?

Long-term care is a general term that describes the type of care or support you need when you are no longer able to handle activities of daily living (ADLs) on your own. ADLs include things, such as getting dressed, bathing, eating, and using the bathroom.

In some cases, long-term care might simply mean that you have someone assist you in your own home with getting ready in the morning and before bed at night. In other cases, long-term care might mean you move into a nursing home to recover from surgery or manage a chronic medical condition.

What are the different types of long-term care?

Long-term care services typically fall into two categories: personal care and skilled care. Personal care, also known as custodial care, is for people who require assistance with non-medical activities, including the following:

ADLs such as dressing, grooming, bathing, and eating.

Instrumental activities of daily living (IADLs), such as grocery shopping, meal prep, and laundry
Companionship
Supervision
Transportation

Skilled care, or skilled nursing care, is for people who require skilled medical care or rehabilitation services, including:

Medication management
Vital sign monitoring
IV treatments or feedings
Occupational, physical, and speech therapy
Wound care
Mobility assistance

What is long-term care insurance?

First introduced as “nursing home insurance” in the 1980s, long-term care insurance is designed to cover the expenses related to your long-term care in the event you are no longer able to handle your own ADLs.

These policies cover the cost of both personal care and skilled care services whenever and wherever you plan to receive care, whether in your own home, an assisted living facility, a nursing home, or a community care facility. Some policies even cover modifications to make your home more accessible, such as adding wheelchair ramps or grab bars to your bathroom.

How does long-term care insurance work?

Before your coverage kicks in, most policies require that you demonstrate you have lost the ability to engage in at least two or three ADLs. Most policies also have a deductible, or “elimination period,” which is a set number of days that must elapse between the time you become disabled (eligible for benefits) and the time your coverage kicks in.

Many policies offer a 90-day elimination period, but others can be longer, shorter, or even have no elimination period at all. Of course, the shorter the elimination period, the more expensive the premium. Additionally, long-term care policies typically come with a predetermined benefit period, which is the number of years of care it will pay for.

For example, a benefit period of three to five years is a quite common duration for such policies. Most policies also come with a cap on the dollar amount of coverage that will be paid for care on a daily basis, known as a Daily Benefit Amount.

When should you purchase long-term care insurance?

Obviously, the younger and healthier you are when you buy the policy, the cheaper the premiums will be, so the sooner you invest in coverage, the better. In fact, most policies exclude certain pre-existing conditions, so if you wait until you become ill, it can be impossible to find coverage.

For example, if you have any of the following conditions, it generally disqualifies you from obtaining coverage:

You already need help with ADLs
You have AIDS or AIDS-Related Complex (ARC)
You have Alzheimer’s Disease or any form of dementia or cognitive dysfunction
You have a neurological disease, such as multiple sclerosis or Parkinson’s Disease
You had a stroke within the past year to two years or have a history of strokes
You have metastatic cancer
You have kidney failure

According to the American Association for Long-Term Care Insurance (AALTCI), the best age to apply for coverage is before you reach your mid-50s. Beyond that age, your health is unlikely to improve significantly, so waiting longer will typically increase your premiums, or you may even become ineligible before acquiring a policy.

How do I purchase coverage?

If you are looking to purchase long-term care insurance, you should speak with multiple insurance providers and compare their benefits, care options, and premiums. Different companies may offer the same coverage and benefits, but they can vary dramatically in price. Always ask about the insurance company’s history of rate increases, including the amount of the most recent increase.

For the best chances of success when shopping for a policy, get help from a fee-only planner, who is not compensated based on your choice of coverage. Or, if you are working with a commissioned agent, we can review the policy terms to ensure it’s a good fit for you before you sign on the dotted line.

What are the most important elements in a long-term care policy?

When meeting with an insurance provider, you must get answers to the following three questions about your policy:

How long is the elimination period before the policy begins paying benefits?
What capacities, or ADLs, must you lose before coverage kicks in?
How many years of care are covered?

These are the most important elements in a long-term care policy, and as such, they will make the biggest difference in the quality of coverage and the amount of your premiums.

Can I buy coverage for my parents?

Yes, you can buy long-term care insurance for your parents. You will pay for the policy, and then have your parent(s) listed as the beneficiary. If you know you are going to be the primary caregiver for your aging parents, investing in a policy for them can help offset the expenses related to their long-term care.

Furthermore, buying long-term care insurance should always be a family affair, because you are going to need your family members to advocate for you and file a claim for the policy when you need to use it. Given this, make sure your family knows what kind of policy you have, who your agent is, and how to make a claim.

What’s more, you should pre-authorize the right person to speak to the insurance company on your behalf, and not just rely on a medical power of attorney. That said, you should definitely have a well-drafted, updated, and regularly reviewed medical power of attorney on file as well.

Once I have a policy, how often should I review my coverage?

Once you are in your 50s, your long-term care policy should be reviewed annually to evaluate new insurance products on the market and update your policy based on your changing needs. Whatever you do, once you have a policy in place, make sure you don’t miss a premium payment. If you fail to pay, even for a short period of time, you’ll lose all of the money you invested and will have no access to the benefits when you need them.

A Key Component In Your Estate Plan

Meet with us for guidance and support in finding the right long-term care insurance policy for your particular situation. In addition to life insurance, a long-term care insurance policy is a key component in your estate plan. When combined with the right estate planning strategies, you can rest assured that your loved ones will be protected and provided for no matter what happens to you.

We view estate planning as much more than just planning for death, which is why we call it Life & Legacy Planning. Ultimately, it’s all about your life and the legacy you are creating by the choices you make today. Contact us today to learn more.

This article is a service of August Law, Personal Family Lawyer®. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life & Legacy Planning Session, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love.

Tags Estate Planning, Health Care, Living Will, Long-Term Care Insurance, Personal Family Lawyer®

Estate Planning

5 Differences of Wills and Trusts

Post author By Kylie Casper
Post date June 5, 2023
No Comments on 5 Differences of Wills and Trusts

Wills and trusts are two of the most commonly used estate planning documents, and they form the foundation of most estate plans. While both documents are legal vehicles designed to distribute your assets to your loved ones upon your death, the way in which they work is quite different.

From when they take effect and the property they cover, to how they are administered, wills and trusts have some key differences that you need to consider when creating your estate plan. That said, you won’t necessarily be choosing between one or the other—most plans include both.

In fact, a will is a foundational part of nearly every person’s estate plan. Yet, you may want to combine your will with a living trust to avoid the blind spots inherent in plans that rely solely on a will.

To determine the right solution for your family, you should meet with us. We offer a comprehensive process for helping you feel confident that you’ve chosen the right planning tools at the right fees for yourself and the people you love.

In the meantime, here are some of the key differences between wills and trusts that you should be aware of.

When They Take Effect

A will only goes into effect when you die, while a trust takes effect as soon as it’s signed and your assets are transferred into the name of the trust, known as “funding” the trust. A will directs who will receive your assets upon your death, while a trust specifies how your assets will be distributed before your death, at your death, or at a specified time after death. This is what keeps your family out of court in the event of your incapacity or death.

Furthermore, because a will only goes into effect when you die, it offers no protection if you become incapacitated and are no longer able to make decisions about your financial, legal, and healthcare needs. If you do become incapacitated, your family will have to petition the court to appoint a conservator or guardian to handle your affairs, which can be costly, time-consuming, and stressful.

And there’s always the possibility that the court could appoint a family member as a guardian that you’d never want making such critical decisions on your behalf. Or the court might select a professional guardian, putting a total stranger in control of just about every aspect of your life and leaving you open to potential fraud and abuse by crooked guardians.

With a trust, however, you can include provisions that appoint someone of your choosing—not the court’s—to handle your assets if you’re unable to do so. When combined with a well-drafted medical power of attorney and living will, a trust can keep your family out of court and out of conflict in the event of your incapacity, while ensuring your wishes regarding your medical treatment and end-of-life care are carried out exactly as you intended.

How Assets Are Handled

A will covers any asset solely owned in your name. A will does not cover property co-owned by you with others listed as joint tenants, nor does your will cover assets that pass directly to your loved ones via a beneficiary designation, such as life insurance, IRAs, 401(k)s, and payable-on-death bank accounts.

Trusts, on the other hand, cover any asset that has been transferred, or “funded,” to the trust or where the trust is the named beneficiary of an account or policy. That said, if an asset hasn’t been properly funded to the trust, it won’t be covered.

Most lawyers will set up a trust for you, but few will ensure your assets are properly inventoried or funded, and we believe this is the single most important aspect of estate planning—and it’s one that is almost always overlooked. We will not only make sure your assets are properly inventoried and titled when you initially set up your trust, we’ll also ensure that any new assets you acquire over the course of your life are inventoried and properly funded to your trust on an ongoing basis, with various maintenance plans to ensure your plan works when your family needs it. This keeps your assets from being lost and prevents your family from being inadvertently forced into court because your plan was never fully completed.

Finally, even with the support of a lawyer like us, it can sometimes be difficult to transfer every single one of your assets into a trust before your death. Given this, combine your trust with what’s known as a “pour-over” will. With a pour-over will in place, all assets not held by the trust upon your death are transferred, or “poured,” into your trust through the probate process.

How They Are Administered

In order for assets in a will to be transferred to a beneficiary, the will must pass through the court process known as probate. During probate, the court oversees the will’s administration, ensuring your assets are distributed according to your wishes, with automatic supervision to handle any disputes.

However, probate proceedings can drag out for months or even years, and your family will likely have to hire an attorney to represent them, which can result in costly legal fees that can drain your estate. During probate, there’s also the chance that one of your family members might contest your will, especially if you have disinherited someone or plan to leave significantly more money to one relative than the others.

Bottom line: If your estate plan consists of a will alone, you guarantee that your family will have to go to court if you become incapacitated or when you die.

Furthermore, since probate is a public proceeding, your will becomes part of the public record upon your death. This means everyone will be able to learn the contents of your estate, who your beneficiaries are, and what they inherit, setting them up as potential targets for scam artists and frauds.

Unlike wills, trusts don’t require your family to go through probate, which means the distribution of your assets happens seamlessly in the privacy of our office—not the courtroom—so the contents and terms of your trust will remain completely private.

How Much They Cost

Wills and trusts do differ in cost—not only when they’re created, but also when they’re used. The average will-based estate plan can run between $2,000 – $4,000, depending on the options selected. An average trust-based plan can be set up for $4,000 to $6,000, again depending on the options chosen. So at least on the front end, wills are less expensive than trusts.

However, wills must go through probate, where attorney fees and court costs can be quite pricey, especially if the will is contested. So even though a trust may cost more upfront to create than a will, the total costs once probate is factored in can actually make a trust the less expensive option in the long run.

Find The Option That’s Right For Your Family

The best way for you to determine whether or not your estate plan should include a will, a living trust, or some combination of the two is to meet with us. During our process, we’ll take you through an analysis of your assets, what’s most important to you, and what will happen to your loved ones when you become incapacitated or die.

Sitting down with us, we will empower you to feel 100% confident that you have the right combination of estate planning solutions to fit with your unique asset profile, family dynamics, and budget. Schedule your complimentary 15-minute consultation today to get started.

This article is a service of August Law, Personal Family Lawyer®. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life & Legacy Planning Session, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love.

Tags Estate Plan, Personal Family Lawyer®, Probate, Trust, Trust Administration, Will

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