Part of having a complete estate plan is thinking ahead about who should be in charge of your finances if you become mentally incapacitated at some point during your life. One of the essential documents in your incapacity plan is a Financial Power of Attorney, and many people have a Durable Financial Power of Attorney. What Makes it Durable? With a Durable Power of Attorney, you appoint an agent to manage your assets and make financial decisions for you, and not only does your agent have … [Read more...] about What Does the “Durable” in Durable Power of Attorney Mean?
Your Power of Attorney Might Not Work for Your Retirement Plan
When you establish a Financial Power of Attorney, it is with the intent of appointing a trusted person to take care of your finances in the event of your disability. But did you know that not all Powers of Attorney allow your agent access to your retirement plan? In order for your agent to have the authority to access and manage your 401(k), IRA, or other retirement plan, your Power of Attorney must contain specific language authorizing such access. If you have a do-it-yourself Power of … [Read more...] about Your Power of Attorney Might Not Work for Your Retirement Plan
Estate Planning Tip: Name Alternate Beneficiaries
One of your goals in making an estate plan is ensuring that your property makes its way into the hands of the right people when you pass away. To this end, you most likely have in mind the names of the people you’ll name as beneficiaries in your Will or Living Trust. However, for each beneficiary you name, you’ll also want to name an alternate beneficiary. Why Name Alternates? In case your primary beneficiary passes away before you do (and you haven’t had a chance to update your estate … [Read more...] about Estate Planning Tip: Name Alternate Beneficiaries
Sharing the Wealth With Mom and Dad
A lot of estate planning advice focuses on the steps you can take to protect and provide for your spouse and children, while minimizing your tax burden. But what about taking care of your mom and dad? Many adult children are in a better financial position than their elderly parents, and want to know what they can do to share the fruits of their labor. Here are just a few suggestions: Give Gifts: Under the current federal gift tax law, you can give up to $13,000 in money or property to an … [Read more...] about Sharing the Wealth With Mom and Dad
Is a Convenience Account Right for You?
In addition to a Durable Power of Attorney for Finances, one way to help ensure that your bills will be paid and your bank account effectively managed if you become mentally incapacitated is to establish a multiple party account without right of survivorship. Also called a “convenience account,” this is a type of bank account that lets you designate a trusted friend or loved one to have access to the account, without making him or her a co-owner of the account. This type of account is similar … [Read more...] about Is a Convenience Account Right for You?
Is All Property “Countable” for Medicaid Purposes?
The Medicaid program is one resource available to help cover the high costs of nursing home care. It is a federally-established program designed to help people of limited means gain access to the health care they need. Although the program is established by the federal government, it is administered by the states, and each state has slightly different rules for qualifying for Medicaid. “Countable” vs. “Non-Countable” In order to qualify for Medicaid, an applicant must meet certain income and … [Read more...] about Is All Property “Countable” for Medicaid Purposes?
What is Testamentary Capacity?
In order for a will to be valid, certain legal requirements need to be met. One of these requirements is that the person making the will, known as the testator, has to have testamentary capacity, or the legal capacity to make a will. In Texas, testamentary capacity comes with two components. First, you must be: 18 or older, Currently or formerly lawfully married, or A member of the U.S. armed forces. You also must be of sound mind. This means that at the time you make your will, you have … [Read more...] about What is Testamentary Capacity?
What Happens When an Executor Doesn’t Finish the Job?
Serving as executor of an estate is an honor and a weighty responsibility. This being the case, most executors take the role seriously and do the job to the best of their ability. For some executors, though, the job is just too much. Whether the responsibilities of administering the estate are overwhelming or there are outside duties to attend to, on occasion an executor will simply neglect his or her duties, and allow a decedent’s estate to languish. When this happens, what can family members … [Read more...] about What Happens When an Executor Doesn’t Finish the Job?
Estate Planning Term: Residuary Clause
One of the risks inherent in opting for a do-it-yourself estate plan is that, without the help of an experienced attorney, you can’t spot any missing pieces of the puzzle. Such is the case with the residuary clause, an essential part of any will, but one may be missing in wills not prepared by attorneys. A residuary clause is a provision in a will that gives instructions as to what should happen to property that is not specifically disposed of in other parts of the will. For instance, if … [Read more...] about Estate Planning Term: Residuary Clause
Make Sure You Update Your Beneficiary Designations
What happens when you pass away with a Will leaving all your property to your spouse, but you never made your spouse the beneficiary of one of your retirement accounts; instead, the beneficiary for that account – designated before you met your spouse – is your sister. Surely, your Will is presumed to express your true intentions, and that retirement account will go to your spouse, right? The truth is your retirement account, like any other account for which you’ve designated a beneficiary, is … [Read more...] about Make Sure You Update Your Beneficiary Designations
