An unfortunate by-product of a financial crisis or recession is a rise in the overall divorce rate. Couples fight over finances more than almost any other topic, and when home finances are ailing many marriages tend to go the same way.

If you and your spouse are victims of this phenomenon, there are many steps that can be taken to try to gain control of the fire before it gains control over you. Options range from finding advice columns such as this one on essortment, to a visit to your financial planner to help understand your financial options, to seeing a marriage counselor. Even if you overlook the emotional toll (which obviously is no small thing), the cost of saving a marriage is much less than the cost of dissolving it.

However, even the most determined and well-intentioned couples will sometimes end up going their own ways. If that does happen, it is more important than ever to insure that you and your family (and your business if you have one) are protected.

Gary Williams, in his article in The Daily Record advises, “The immediate months after a divorce can be disorienting — even if you don’t move, you are literally starting a new household… and that means new money issues to face. This is why the weeks immediately after a divorce are a good time to revisit short- and long-term spending and planning goals.”

Williams also advises that it is “best to blend estate planning with financial planning post-divorce.” It is likely that any of your tax-deferred savings accounts (retirement accounts, life-insurance policies, etc.) name your ex-spouse as the beneficiary. It is also likely that if you created any estate planning documents pre-divorce your ex is named as your health care agent, financial agent, executor, etc. If you had an amiable divorce you may still be okay with this, but what happens if your spouse remarries? What if he or she has children with the new spouse?

If you are recently divorced or going through a divorce, you are going to be overwhelmed, emotional, and exhausted. The easiest thing in the world would be to put off your financial or estate planning. Don’t. As John Lennon said, “Life is what happens while you’re busy making other plans.”

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In today’s economic climate, when it’s all but impossible to be sure of your investments, it is more important than ever to have confidence in your financial advisor. But with all the different credentials and designations that can be found on the business card of any given advisor, how can you know who to trust?

Kerry Hannon of US News and World Report knows how. Hannon’s article, How to Find a Financial Planner, lists six tips to help you find and choose the right person for your investment needs. Hannon recommends (among other things) screening your candidates’ credentials, looking into a planner’s background, and coming to your first meeting prepared with specific questions.

The very best way to be sure you’ve found a trustworthy advisor is to get a recommendation, particularly a recommendation from a professional in a related field. As an Estate Planning Law Firm, we work closely with financial planners every day. Because we work to protect your assets, we’ve made it our business to build strong relationships with caring and qualified financial specialists. Not only can we help you find a planner who is educated and trustworthy, but because we know your family well, we can help you find the right advisor for your particular needs. Call our office for more information. We’ve already done the legwork; now we’d like to pass our knowledge on to you.

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With all of the uncertainty on Wall Street recently, many of our clients whose bank accounts are held in their Revocable Living Trusts are concerned about whether their assets are protected, and to what extent.

According to the FDIC, accounts owned by a Revocable Living Trust are indeed insured.  To what extent they are insured depends on who your beneficiaries are and when they become entitled to their interest.

The owner of a living trust account would be insured up to $100,000 per beneficiary if all of the following requirements are met:

The beneficiary must be the owner’s spouse, child, grandchild, parent or sibling. Stepparents and stepchildren, adopted children and similar relationships also qualify. In-laws, cousins, nieces and nephews, friends, and charitable organizations do not qualify.

The beneficiary must become entitled to his or her interest in the trust when the owner dies — coverage would be based on the beneficiaries who meet this requirement at the time the bank fails. Example: A living trust names an owner’s three children as beneficiaries but states that each beneficiary’s share will pass to the beneficiary’s children if the beneficiary dies before the owner. Assuming all three children are alive at the time the bank fails, only the children — not the grandchildren — would be beneficiaries for insurance purposes. (That’s because the grandchildren are not entitled to any trust assets while their parent is alive.) Coverage up to $300,000 ($100,000 per beneficiary) would be available on the trust’s deposit accounts.

The account title at the bank must indicate that the account is held by a living trust. This rule can be met by using the terms “living trust” or “family trust” in the account title.

If you have any concerns about how your account is titled and whether you are covered, please call our office for more information.

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The end of summer is upon us, with many people closing up the summer cottage, and—with wistful backward glances—returning to the hubbub of everyday life. But those happy summer memories, and looking forward to next summer, will keep us going through the winter. And so, to conclude our series on real estate protection and investments, we offer you this article by Sylvia Hsieh on how to keep that treasured vacation property in the family for future generations.

Hsieh accurately points out in her article that in order to keep a property intact and available to ALL your children and grandchildren, care must be taken now to avoid confusion and arguments later. One of the best ways to keep a property available for many beneficiaries is to hold it in trust, with one person (or group of people) serving as trustee, managing the property according to your instructions. This is not the only option, however, and our office can tell you if a trust is right for you, or if your family might benefit from holding property in an LLC or FLP instead.

One of the most important points Hsieh makes in her article is that this issue isn’t an issue exclusive to wealthy families. Your vacation home doesn’t have to be a mansion in the Hamptons. Many middle-class families have a small cabin, a piece of undeveloped property in the woods, or even a timeshare, which serves as the setting for countless happy family vacation memories.

Your children and grandchildren can continue the traditions you’ve begun if you take care to protect your investment now. Let our office help you preserve your vacation property for future generations—and future memories.

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This week’s blog series has focused on real estate and how your estate planning attorney can help you leverage and protect it. But we know that many homeowners right now aren’t concerned so much with protecting their property, but protecting themselves—from the effects of falling home prices. If you are one of these homeowners, this post is for you.

Craig Gustafson describes in his article how one San Diego, CA resident found relief by asking county officials to reassess the value of his property in order to lower his taxes. The result will save him $1000 annually. This trend of reassessing property is taking hold not only in California, but all over the country (although not all residents will be as lucky as Michael Ortiz).

Before you run to your phone to call your assessor, Deborah Gates asks us in her article to remember that lowered assessments can have far-reaching results not only for you, but for your entire community. One of those effects includes a lower assessable base from which counties can draw income, which could result in a rise in county taxes. Another effect, which is more personal, is that when your house is valued at a lower price, you lose the credit you have to your name, and which banks are willing to let you borrow against.

If after reading both of these articles, you still feel that a new assessment is the right step for you, Elizabeth Brokamp has some advice that can make the assessment process go a little more smoothly. Brokamp includes some excellent tips in her article, but one thing she leaves out is that you can ask for help from professionals who know the process. This is one of those situations when experience can make all the difference.

However, if all these articles only tell us one thing, it should be that assessing your property is anything but a quick and simple fix. Before taking action it is always helpful to get the advice of the advisors you know and trust, including your estate planning attorney. Remember, although the property is yours, you don’t have to do it alone.

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One of the main ways that wealthy families accumulate and keep wealth is through real estate. Despite the year-to-year ups and downs of the real estate market, the value of real property continues to grow over the long term.

Real estate is often considered a comparatively easy way to maintain and grow wealth because it doesn’t require the kind of daily attention—or stress!—that a business demands. Depending on the type of property, real estate typically requires duties that are annual or month-to-month, such as maintaining the physical structures, paying property taxes, making insurance payments, getting updates from property managers, and the like.

What real estate investors might be slow to realize is that property ownership carries with it significant liability risks. Unless the precautionary measures are taken, one small misstep can result in the loss of all your real estate holdings. Imagine it, one person slips and falls in front of one of your properties, and suddenly ALL of your holdings are at risk.

Preventing this kind of mess is not as difficult as you might think—for example, putting each of your properties in its own separate legal entity is one technique that can be used to protect all of your properties (and yourself) from lawsuits. Our firm can help you with this and other asset protection techniques.

We know how important it is to keep your family and your finances safe, and we are dedicated to helping you achieve that security. Call our office and let us tell you how we can put our expertise to use for your benefit.

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Real estate plays an extremely large role in the estate planning process. As mentioned in previous posts, your home (or other real estate holdings) often forms the bulk of your assets, and figures largely in the creation of your family’s estate plan. But real estate can serve as far more than just the cornerstone of your estate plan, especially if you have property aside from your family home.

In the current downswing of the real estate market, many people are finding that holding on to unproductive property is becoming a financial hardship. And yet they are reluctant to sell the property at a loss. Enid Ablowitz, in her article Giving the Gift of Real Estate, has some excellent suggestions on how to get the most out of property that no longer serves your family or your business, including giving the property as a charitable donation, transferring the property into a charitable “lead” trust, and keeping the property in a retained life estate.

Ablowitz suggests in her article that unproductive property can be turned into an asset when used as a charitable gift. In fact, Ablowitz writes, “When there is charitable intent, there are many scenarios where a gift of property can also be tax-wise.”

If you think you might like to look further into leveraging your property—for charitable purposes or otherwise—your estate planning attorney can help. Our office can answer your questions about the tax advantages of making a charitable donation of property, or alternatively of keeping the property, but holding it in a separate protective entity such as an LLP or FLP.

When considering your estate, your property is likely your greatest asset. Let our firm help you decide how to make the most of your property, whether you choose to leverage it now or keep it safe for the future.

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Do dating and estate planning go hand in hand? They do if you are one of the lucky people finding romance late in life.

With people living longer than ever before—and staying healthy and active longer as well—there are more cases of people finding love a second (or third or fourth) time around. This is cause for celebration for widows and widowers, but it has many of their children and grandchildren worried. When mom remarries at the age of 80, what happens to the estate that she and dad built during their lives together?

Without a prenuptial agreement or estate plan, all of mom’s assets could end up going to her new husband, which he could then choose to leave to his children. With so much at stake it’s no wonder that the children of elderly brides and grooms are responding with less than unadulterated joy.

Luckily, this is one problem with an easy solution: Involve your estate planning attorney before the marriage takes place. Executing a pre-nuptial agreement can go a long way towards protecting your assets and your children’s inheritance. Another option is to create a trust which leaves all of your assets to your children or grandchildren upon your death.

Talking about prenuptial agreements with your new fiancé can be an awkward conversation, especial for the older, more traditional generation. Creating a trust early can alleviate much of that awkwardness.

Romance is still alive, even at 80 or 90 years old. Unfortunately, so are the financial risks that come with any second marriage. Call our office today. Let us take care of the risks, and leave the romance to you.

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On a scale of one to ten, how high would you rate your retirement angst? If you are a woman, you’re likely to rate your worry higher than men rate theirs, according to this new study by MIT AgeLab. This begs the question; are women just more inclined to worry, or are their fears justified?

The answer to that question would seem to be the latter. According to Dr. Joseph Coughlin, a woman is “likely to outlive her male counterpart, remain active longer, and be responsible for caring for him and others.” What Dr. Coughlin seems to be saying is that women aren’t just worried about retirement, what they fear is actually a myriad of issues having to do with finances, health, caretaking, and social concerns, none of which can be separated from the others.

What this means is that there won’t be one simple solution for women to their retirement fears. Any “solution” will have to consist not only of a simple financial solution, but also of a plan to address issues such as:

• How to make up for a retirement income that is, on average, 58% of men’s.
• How to adjust if you end up caring for a family member in declining health.
• How to weather future inflation and changes in health care coverage.
• And what to do if your spouse passes away.

Women know that fear can be productive and motivate us to find solutions. Hopefully by naming this fear women will be inspired to take action to protect their futures. Men can take action to help protect their wives and mothers as well. It’s no exaggeration that women will live longer than men, and are likely to take on the burden of caring for aging family members. Planning for these eventualities when you’re young, and planning with your spouse and family can ease the burden later on.

If women out-worry men on the subject of retirement, let their planning reflect that. Nothing eases anxiety like preparation. Don’t let your fears paralyze you, let them motivate you instead.

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When it comes to retirement plans there is no one-size-fits-all situation. And not all plans are created equal. A traditional family will need a different plan than a blended family with stepchildren; a divorced man will need to plan differently than one who has never been married. How can you know which plan is right for you?

The New York Business Wire has published an article with a series of tips to help you plan for your unique retirement situation. The article caters specifically to non-traditional circumstances—such as blended families or single women—and the distinct challenges they face.

One of the article’s recommendations is to establish a trust to protect your estate from ex-spouses and keep it safe for your children. As a firm that has helped a number of families set up trusts to keep their retirement intact for the benefit of their children, we know what a crucial step this can be.

If you’re wondering whether or not a trust is really going to have what you need to achieve your goals, you should know that there are as many types of trusts to protect your retirement as there are families who need protection. Some families may want a full-blown Retirement Trust; others may be satisfied with the protections offered by the basic Revocable Living Trust. Whatever your intention, a trust can help you attain it.

Whether your situation is traditional or not, each family’s needs are unique. Talk to your attorney and financial advisor about your plans for retirement. Make sure your future is protected—for yourself and for your loved ones.

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