Estate Planning & Elder Law Hour - 7.7.18

Saturday, July 7th

I believe that Estate Planning is here to give you control over who is in charge of taking care of you and control over how you take care of your family after you are gone.  Without proper planning you can lose control and your family will not be able to take care of you as easily, or you will not leave your estate for the benefit of your family according to your wishes.

I had an experience in my own family where during a crisis, we lost control over where my grandmother was going to receive care.  This caused my grandparents in their last years to be separated by a long distance after more than 60 years of marriage.  I believe that my grandparents have drawn me into the field of estate planning and elder law to affect the lives of my clients so that they can have a different experience at the end of their lives than my grandparents did.

I place a special emphasis on protecting the assets of aging loved ones and educating families about complicated laws and the best options available to them.  I am passionate about helping others preserve their money, avoid probate, and achieve lifetime estate planning goals. 

I started my post law school career working for a large financial company helping financial planners with advanced estate planning and tax planning. I utilize this financial services experience to bring a different perspective to my estate planning and elder law clients.  My number one priority is to educate and empower clients to make the best decision for them and their family; there is no one way to do things.  I strive to give clients options and let them choose which direction they want to go.  I like to say, “If you don’t ask yourself the right questions, you never get the right answer for you and your family.”
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Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

This is the estate planning an elder lauer with skip Reynolds. Are we dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Welcome everybody to the estate planning an elder law hourly he skipped Reynolds thanks so much for joining me this Saturday afternoon. Hopefully you've had a great week a happy fourth of July to everyone I know. I had a great time hopefully everybody else said a safe in good time out there as well. As a reminder I like at the beginning of the show to tell you why I do the show. And the reason I do the estate planning you know realize hours because what I found in my office is so many people coming into me with me and gave me. What they thought was so the correct decision for our property or for an account or something of that nature. Not understanding all of the potential consequences of the decisions in the actions that they may. And the reason it's this way is because I call it the ball fat. We hear things from our neighbors our friends our co workers but me reading in the newspaper or on line or wherever we get our information from. And we say you know what those are the facts I put that together with these other things that I know and I know that this is what I need to do. Or this is what I shouldn't do. And we make actions based upon these things and what. Unfortunately happens is if you have to have fact and another half acting put him together and you think that that's the whole fact. And it's not. Then you run into problems you have unintended consequences. And maybe you lose control maybe cost you more money. BB causes other issues. On down the road that maybe had no idea were potentially coming. And that's why do issue because a wanna give US Paul Harvey used to say. The rest of the story see you have the true facts. And you make the right decisions for you and your family and you understand more of the consequences. Of your decisions whether it's good consequences are bad consequences as long as you understand what's going on. You have now made a better choice of more educated choice. And that's with the goal of this show is is to give you. More information. All right so I wanna kind of jump back in last week I was talking about. An article. That I was reading and it was talking about ten surprising estate planning mistakes. And I got through fuel long but. I'm gonna go back and and and it kind of restart and go through all of these two day again. So if you listen at the end of the showed last week you might be hearing in a kind of a read Peter the first couple here but then I'll get into the new information so. Some of it estate planning mistakes. That. People ready to an artist list of loft and it'll go back in each one and talk more about one out in these are in no particular order. One is beneficiary blunders meaning you're doing something wrong with your beneficiary designations on accounts. Number two would be selling a property for one dollar. I'll talk specifically about that. Naming specific investments inside of your will to go to specific people. And some of the things it can happen around that number for not thinking through a well intended gifts you want me to give. Property to your children after you're gone. Not thinking it all the way through in in the way that you have written it out. Number five leaving money directly to minors. Without taking into account that they can't receive it. Number six not planning for the death of a beneficiary. So where do you want to go with that beneficiaries not there number seven. Ownership mistakes any imbalances. With in the estate planning how you're leaving two people. Number eight not having their recede you wary clause is did you where he means the rest so what happens to the rest. On number nine not planning for an unexpected change. In health viewed your spouse. Death of a child or spouse creditors divorces. Addictions not not planning for those things and number ten not dealing. With your own mortality. There's two things I know life. Will pay tax that is and how much and not and now how often. And I don't and we will all die. I just a no win how true what circumstances etc. but a lot of us still like to think about it all because it makes us moral. Are some kind of gone back to number one beneficiary blunders so. And all use exe apples here a things that I've seen in my office. One thing that is out there. And it has specifically did you with retirement accounts so IRAs 401 k.s 403 b.s Roth IRAs. Whatever it might be. So that money has not been taxed. So those of you that are approaching seven and a half or maybe over seven Ian have. You understand that it's seven in half the IRS who's going to serve making you take out what's called and or MD. Required minimum distribution right. And every time you take that money it comes out taxable T. Well when we die we can name beneficiaries on those accounts were I can say on my 401K hey if I dial wanted to paid in my life. Or when I die wanted to paid my kids or to whomever I'm leaving it. When you die and you leave it through beneficiary designations so let's say a typical setup for many families it if you're married. Is unit leaving tears spouses the primary beneficiary. You only that your children especially if they're grown. As the contingent beneficiaries. The problem is it and I see this all the time is that many times when we're either working with a financial planner or maybe you were doing it ourselves. We are pretty good about naming. Our spouses the primary beneficiary. But we're not always so good about naming our children or whoever else we want as the contingent beneficiary. So what that means is if you don't have a contingent beneficiary. And you die and your spouse is either pre deceased you fore they died with you the say it was a common car accident killed you both. And you don't have. A contingent beneficiary named the deep faulty is that you'll go through your will and you'll go through probate. Annual follow your will if you have one if you don't have one now you really of Los control because now I don't know exactly who the beneficiaries might be. But either way will or no will it will go through your state the problem with the going to your state is may not be where it ends up. It's the way in which she ends up to them so when you leave it to see your children as a contingent beneficiary. They have the opportunity. To take it now one of three different way X. One way is it can take all of the money right away. Thank you very much mom or dad things for the 100000 or 50000 or whatever the amount it and then Mitt IRS says okay. You took that money that is never meant tax we're gonna add that account that amount excuse me. To your taxable income for this year and you're gonna pay SR share. So that say they got 50000 dollars and they made 50000 dollars working they just made a 100000 dollars that year and will pay tax at whatever their tax rate is at that time. So that's the first option. The statistics say when I used to work for a financial company that anywhere between seventy and 90% of beneficiaries of IRAs take that lump sum. Are number different reasons the easy ones to think of war there RD spending yet they don't understand the tax consequences. Of taking it. Those are the easy ones the second option that a beneficiary would have if you've got them named is they can decide to take that. 50000 or whatever the amount is over a five year timeframe. So in theory they could take 20% each year they can take it all in year three because they got laid off. They can do whatever they want as long as it's all gone by the end of the fifth year so little bit more tax efficient in the first because now we can spread out that taxation over a number of years. Rather than lumping it all into one. The third option that they have if you leave it directly to them. Or if you leave it to a trust store will in the right way. I would say trust would be a better scenario in the right way. They have a third option which is called stretching it out over their life expectancy the beneficiaries. Life expectancy. So let's see your child is sixty years old when you pass away in you leave it to them. Their life expectancy may be 2526. Years old. If that's the case. Heard Tony five or 26 more years. They will only be taking now there own required distribution based upon their remaining life expectancy on this IRS table. So if they've got 26 years left to live on that table their first distribution that they must take would be 126. Of the account. In the fall in your B 125 when 24 123. He see how you can keep it tax deferred a little bit longer he can control the taxation. Now they can always take more than that required distribution no different than we can. On our own accounts when we turned seventeen half but there. You don't have to take more if they choose not to for whatever reason going on in their lives. So. If you'd die and you do not have a contingent beneficiary. On net. Account and it goes through your will alert goes through you the this state process if you don't Havel will. To get to your kids or wherever those non spouse beneficiaries are. It will be. You'll lose that third option you will not be able to stretch it out over the beneficiaries remaining life expectancy. So if you got lots of wiring money and you don't have contingent beneficiaries. The attacks that could come do you on those accounts could be significantly. Greater because of these options that your family may have. So the idea here on the higher rate in particular is make sure that you have contingent beneficiaries. Whether it's your trust if you have a trust in you got the right language inside of it whether it's your children or other beneficiaries directly. But you gotta make sure you've got someone there because if you don't the tax ramifications can be huge. All right so that's on the IRA money Willis talked about. Other accounts like life insurance brokerage accounts bank accounts all of these things can have beneficiary designations too. Where I've seen some people running and unfortunate scenarios. It is that's one story is there was a husband who had been divorced. And he had remarried. But he'd kind of just been lackadaisical. Any hadn't gotten to all of his accounts and he hadn't changed around. All of the beneficiary designations on his accounts. Well then he has some kind of health events and he's dying of this health event. And he's in the hospital. And they're scrambling around as a family trying to you get the designee that paperwork for his life insurance. On one of his accounts to change the beneficiary from his ex wife to his current wife who he's been married to for ten years. And the problem was is dating get to it is time UC Fargo on any passed away guess you've got to pay up. His ex wife. Not his current now. There's many different things it can be said turning that but. He wanted his new wife to have it but he didn't get to its. And so therefore when he died he didn't get taking care of the way he won it and it went to the wrong person. And the problem here is that and this happens a lot folks and and hopefully you out there are are shaking your federal that's not me. Are but there are many many people out there. That will do some form of estate planning whether it's simple wills whatever go to willing to returning going to a legal zoom. You know going Office Depot it doesn't matter but they are not good at executing the next phase of the plan which is integrating your assets into your state plan. As a they're very bad at doing that. And in this particular example it cost his new spouse beat to death benefit wasn't huge but don't want to say it was something like. 100000 dollars now that's a 100000 dollars it his wife doesn't have to live the rest of his or her life. That he had intended for her to have he just was lazy and never got to it. Because I know how it works it happens in my life to. You know you lock out the door if you especially if you're still working in the that proverbial two by four star swing and match you know you're doing is stuck in all day. And trying to make it to tomorrow. And when that happens. You'll get to things that may be very important and that's what happened for that individual. So beneficiary designations are very very important and I know I talked about it in other shows and talking about integrating our assets. But when you have a simple plan when you have more complex plan. I don't care. If you don't get to the beneficiary designations. And you don't consistently maintain them to correspond with whatever your plan is reading to be. Your plan will not work all the way you want. And that would be a beneficiary blunder in my book. The next one is selling your real estate to a child in particular. Usually a child for one dollar or other good consideration. It's kind of the language you'll see on there. Essentially this is a gift you didn't sell it to him for a dollar even if he did solitude for a dollar. Here's some of the ramifications. So let's just say in this happens in my office more than I would like to admit when people come it. They've bought their house thirty years ago. Or more may body for 507500000. Dollars. Now that puppies worth 34500000. Depending on the neighborhood that therein. So all of that Sissy about it at a hundred announce worth 400 says that difference between a 500000. Is called capital gains. Right or in our own personal residence. Depending on whether you're married or your non and some of the other residency requirements. If you were to sell that house you may not have any taxation do any capital gain due for selling that house. The problem is is we knew given away to somebody. It seeing your child. That is different. And why people give it away. While you're away because they wanna avoid probate. But he give it away because they want to do not own that asset so if they get sick in the future need long term care Medicaid can't come in take that house away. It is the main asset that they had. So they do these actions may sell it to their kids a quick claim it to their kids. Opt for one dollar ten dollars another good consideration essentially it's a gift. Bucking 'cause. A problem from a capital gains standpoint because the IRS is gonna look at that and say. Your child now has your cost basis or you bought it at a hundred that's what they bought it that effectively. And then when they go to sell that house for 400 or 500 or whatever. They will pay tax on the difference. So. I had a scenario here in my office recently where somebody had gifted away their house because they wanted to avoid probate. They were so afraid of probate that they gave their house to their child okay that's fine. Problem is they didn't understand the next consequences they give it away they're kid. Now the kid Jones there house. Might be kid Jones there us not them. So they lost some level of control because I saw I call that kind of a gift non take a back double. And so now the kid owns a house. Mom dies. Wanted to avoid probate. So a typical probing this simple scenario probably on the high end might cost you 5000 dollars on the high end and a real simple a state. So to avoid this if 5000 dollar potential expense. In this scenario it was a 100000 dollar house that was spot. It was worth 400. When mom died so the kids sells it for 400. There's 300000 dollars of capital gain to that child. So 300000 let's just say. They were at the 20%. Capital gain tax rate. So is 60000. Dollar capital gains tax is due from the child. For the sale that house that was in their primary residence. Because mom wanted to avoid probate gave it away. So to save five they gave up sixty. So essentially lost 55000. Dollars for trying to say five. Because they didn't understand the rules. And it causes a capital gains which. So I wanna continue this fifteen. When we come back after the break. And talk about how it can affect Medicaid in your long term care needs in the future because that's another reason people give things away. So when a comeback will continue talking about selling or giving away a property for a nominal consideration. But I do wanna remind you out there. That if you missed any part of today's show. You can go to cruise in 1430 web site. And you can click on shows then go to weekend shows. And then click on the estate planning in elder a lot hour and you can find this show and past shows there. Or you go to my website skipped in law dot com that's SK IP TO and law dot com. And you can click on blogs and he'll drop down the radio shows will be there you concede to pass shows as well as this one as well. Also want to remind you out there that I do you do public workshops talking about things like I'm talking about today on the show. He'd like to you come to the workshop where you know somebody who had need. C get this good information. And maybe get the process started out reviewing your plan updating your plan. Being a plan in place maybe it's the first time we've ever done it's on your bucket list. For the year I've got to coming up I've got one Wednesday the 25 of July. It's here at the crews in 1430 building. It's right up the Bellevue and 925. That one is Wednesday the 25 from 1 PM to 3 PM. Or he can't make them wanna go when the following week Tuesday the 31. In this one is at the lone tree library. From two to 4 PM. If you wanna come to the 31 we've only got a few more spots left because we've got a smaller space. But we have plenty of space on the twenty this if you like to come to that we'd love to have you come out here what I have to say see if it fits for you. So when I come back and and continue our discussion about giving away property for nominal consideration and things you need to think about it's a stick around. This is the estate planning an elder lauer with skip Reynolds. We dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Welcome back everybody to the estate planning you know realize our with me skip Reynolds thanks so much for joining me this Saturday afternoon. This is the second segment of the shows if you miss any the first segment of the show. On today I'm talking about ten surprising estate planning mistakes mistakes people make. That they didn't even know they were making or accidentally made where they were trying to accomplish one thing it cause another. Bigger problem or another problem. So and I was talking about beneficiary blunders in the first part of the show right before we left off us talking about selling or giving your property. Oh wait two in particular child. For what I'll call nominal consideration selling it for one dollar ten dollars or a hundred dollars. Kind of thing and I talked about specifically how that can cause. A huge capital teen issue especially as it pertains to realistic. The other thing is that in in what I wanna get into here before and move on to the next one is when we give things away. Let's say down the road you've got a long term care issue and now we're blowing through your money. Depending on how long ago you gave that away Medicaid penalizes you for having made a gift within the last. Five years that doesn't mean you can't go on Medicaid. Within those five years it just means they're going to penalize you so depending on the amount of the gift. You may or may not have. And issue witty you have to week five years to qualify. But a lot of times people give away their reason real estate eight. In some capacity whether they. Make their child's joint tenant with them or whether they give it away completely. And they do it to try to avoid the nursing home or Medicaid coming in ever taking their property away. I understand this year but if you give it away and you don't do it the right way and you know our understanding how you've done it. It could cause. Wave bigger issues down the road. Because if you give it away they don't have to give it back. And if you get penalized for this if you don't start looking at your other assets in your long term care needs soon enough. The problem may be on fixable and then your on your knees begging and pleading with the Medicaid office. To approve you for some kind of an exception. Because you can't get this back he can't do what's called cure the gift fixing the gift so. If you give things away you can give them away but be aware. That by giving things away whether it's real estate money. Whatever it is by giving them away if you need to go a long term care. You need to now be looking for word as to you what are might care needs gonna be in the in the relatively near future. I even next five years. And how by getting get this back if I need to fix a problem and go on Medicaid. How my going to you pay for my care. Instilled the penalty is gone or until the five years is over. You've got to be looking forward I'm not so you don't do it I'm just being. Blunt in saying you've got to be aware that. Circumstances can change and don't be fooled with this scenario. All I know that I'm not gonna need care in the next five years. I had a woman called me. On Monday to come in inside her powers of attorney they were all drafted ready to go she calls me on a Monday Tuesday morning massive stroke. Never goes back home. She was fine Monday morning. Tuesday morning she wasn't. I'm not saying that's gonna happen for all of us but we can't live under this oh I just know everything's gonna work out scenario. That is the exception not the rule all right so selling property for. Less than it's worth they're giving things away. The other one it it and number three would be naming specific investments in your will. So in this article they gave an example and I thought it was a really good example. Is it the value of an investment that you're giving to somebody in your will to go up or down. With look at whether you use the money whether the market goes up been down if it's invested in the market whatever it might be. So in that article Tugnutt these surprising estate planning mistakes they gave the example of dad who. More are Graham Paul wanted to give a grandchild. This specific stock. And so in giving this specific stock he put it in his will when he said I wanna give this stock to them. Well then time went by and now were out fifteen years. And now that stock that was worth you know ten dollars this year when cramp up put it in his will is now worth a hundred dollars this year. Did grandfather really intend to give that one grandson such a large chunk. Vs other people in his will. Maybe the answer is yes may be the answer is no but it's obviously increasing value in so. You know the way I read that is not that Graham but did it so wrong it's that we just need to sit down and review what's in his well. To make sure that it is the way he wants it now. You know let's see the value of that I can consider be in 101000 dollars is now a 100000 dollar ability really wanna give this same grandson a 100000 dollars. I don't know. That is an opportunity sit down and review things. I think the other thing to think about with. Naming specific investments in your will or specific accounts but coliseum where I want this life insurance account to go to this person and I want this. To go to that person. Is I've had so many people they come in and they have these type of provisions in their will which is fine. The problem is that the will only controls what goes through it so if you will has this and it's. But do you account designations of let's say grapple on mine in my example. His account says transfer on death to his son not to his grandson. Well that transfer on death or TOD. Circuit and that's what he has in his will and bypasses his will completely. It goes directly to the sun not to his grandson which is who he said he wanted to go to in his will. Right so. It bypass the will or if you have any near trusted bypasses the trust she got to make sure that you beneficiary designation goes to your will or to your trust. So make sure that that pass tickets to use the proper person in the proper manner. If that's the way you want it to be. C got to take a look folks she. You can't throw this stuff in the safe or in the you know safe deposit box or where every year keeping it he can't just throw it in there wipe your brow and go. Glad I got that done. You've got to consistently keep up with it and if you don't. You're assets will change your counsel change over time over a period of 13510. Years many things can change. And if that's the scenario for you and you haven't consistently kept on top of beneficiary designations or what's in your will. You may be leaving more than you want to somebody less than you want to somebody not to the right person anymore. Etc. The other thing is that if you want. An account like Graham Paul wanted that stock account to go to his grandson. In order for there will to move it in give it to the grandson. It's got to go through probate. Because you can take it through your will if it's over 66000. Dollars in the state of Colorado. If you've got more than 66000. Dollars in total going through your will. You will have to go through the probate process. So. Understand if you put this stuff senior will you may have to go through probate. A videos of real life example of somebody mail with here just recently. All the accounts were entitled to go to the kids which is pretty much the way that mom wanted to be. But mom also had in her will that she wanted a specific amount. Or couple of the grandkids 101000 I think it was the problem was. Is that no money really was going through who will because it was all designated go straight to her children. So now her children. Have a moral obligation to fulfill mom's wish not a legal obligation. Which I think in this circumstance is gonna work out just fine. But just be aware. If you've got this 101000 to Johnny 2000 Joey this suit this account to you this grand kids. If you've got those provisions in your will or your trust you better get those accounts there. Or that won't happen. It's integration of your statement. And as a state planners were great giving you the documents were great telling you what to do. But we're not good at following up and you're not good at doing the dotting the I's and crossing the t.s from now until you die. And we got to get more on the same page in my book. All right so that's number three number four not thinking through a well intended gift. I though this is a really good example they gave in the in the article so in the article mom wanted to leave. A piece of her house. Piece of property. To your kids is saying. In in this circumstance saying you can't sell it until all the kids have a house in that city because it was where they all grew up. What to of that in this article two of the three daughters lived in that town. But one of the three daughters lived in California. And had no intention of moving to that town didn't want and own a piece of property in that town. But in mom's a state plan she said he can't sell a house until all three of them have a property. In that town. And assessing what mom was saying is that she wanted this other daughter to maybe even half per house but the problem was is that. It's battled these kids with the maintenance of this house. Even if they didn't want it anymore even if no one wanted to buy nobody wanted to move into it of her children. They were now saddled because this state plans said you have to keep this thing. Come heck or high water. And what happened was that one daughter didn't wanna house and that. Town but to the state plans said she had to have before we could sell it so they had to go through a lengthy process. To deal with this and end up costing quite a bit of money just so that they could sell it. To overcome what moms will it done. I think there may have been in Colorado some easier ways of doing it but the point here is. Sometimes when you say did this is the way you got it it has to be. You gotta think about what are the potential ramifications of foreseeing that issue because sometimes the forced. Forcing none of this makes more issues in makes a bigger headache for family members and you know from what I hear in my office 99 out of a hundred people want their state plan to be relatively simple for their family. Well if you're forcing things like hold on to this property and you can't sell it until everybody has a house there that can make it much more complex in a hurry. When all you're thinking you're doing with simple buying it. See just got to understand the consequences of your choices I'm not telling you these shouldn't put in those sets of provisions necessarily. I'm just saying be aware of potential problems that could come with. Putting it in there. Number five. Leaving money directly to minors without dealing with the conservative or ship issues. So I'll give you a great example to happen in my opposites happen I guess back in 2000 and then eleven or twelve now. So. This scenario was. Grapple lived in a different state. And grapple wanted to give money to all of his kids in all of his grandkids. Sounds very noble right. Here's the issue. Either grandpa didn't have good legal advice or didn't listen to it or whatever might be but what he did is on his account. He had one big arm investment account on that account he named all the kids in all the grandkids as beneficiaries of that account. And it figures to eight total people. Here begin the issues. Three of those beneficiaries. Were grandchildren all three of those beneficiaries. Were under the age where they could receive the money. And then an additional. Issue is one of those three on not my client's children but one of those three children was actually special needs. It was receiving Medicaid and other benefits that would've caused disruption to. So this people had you actually not take that money on behalf without minor which bumped up the amount every one else received. But my client and her two kids at that time I believe they were. Herb nine. And my client. One hates you set it up in just have that sitting around and waiting for them for when they went to college. But before she could get the money for the kids she had to go with me into the courtroom. And we had to have a case opened for both the sun. In the daughter. A 160 dollars a piece just open the case didn't even pay me assess yet. Then we had to go into the court and open the conservative ship. And at the time that we are going through this the court suggests really gotten their wrists slapped pretty hard about conservative ships and how they were. You know kind of ranting a lot of authority to everybody. This would end up happening. Was the court said yes I'll grant to conservative shipped them on. But I'm gonna make her put it in what's called a restricted account. The so we had to go and put it into an FDIC. Insured account meeting. We couldn't put me in investments had to be in a CD. Or savings account or money market. Are checking with interest. Ball I'm sure that all of you are aware that those accounts are not paying very much interest these days but the interest rates being so low. So in effect to what happened is because grapple left it to the kids directly and we had to go set up the conservative or ship. Because a new issue for this particular client and that. That money's barely earn any interest over the last few years. So during the last few years had we been able to invest that money that CD grapple I left it through his estate plan to a trust for those kids. Then we could have gone out invest that money into you you know. Mutual funds or stocks or whatever might be. I would venture to say based upon the way the markets behaved since that time frame that that money would have doubled. If not more. And maybe would have paid for two years of college instead of one. But graphs budgets lefty directly did the kids it's not only do we have to go into the courtroom pay money to get. Access to the money so we can even have it in an account. Designated for the kid. This particular scenario ran into us NAFTA with the court. Even if you don't run into this staff who with the court every single year you have to file. Filing saying what's gone on with those accounts during the last year she became Munich an accountant to the court. Of what's gone on. And then at age 21 if it's a significant sum that he gets access to it no strings attached. Mom dad grandpa law. Can't control it. So if you've got only money dear grandchildren. You need to be mindful of how you leave it till how old are today. How old are you how do you want it to be held do you want him to have access to right away you wanted to be deferred do you would you like. Somebody to be in charge of the for them for a period of time. If so I would recommend instead of giving it directly to them give it through your will lose your trust and set up a trust for that kid. But that grand kids. To make sure that your rules apply not the court's rules. All right so I wanna take a break here and when I come back I will finish off this list with 6789. In ten. On and talking about this if you missed any of the second segment this show again we're talking today about. Ten surprising estate planning mistakes. So love I've gotten through. Five of them so far and will blast through the last four here in the last segment. But if you miss any of being go to the crews of 1430 website you can click on shows then go to weekend shows. And you can find the estate planning underlie our show this show in past shows there. Or you go to my website skipped into law dot com that in that is SK IP. Tee though and law dot com and you can find it under the blog page Gil could drop down and have radio. Also wanna remind you if you like to come to workshop where I talk about. What I'm talking about today I talked about Medicaid and talked about trust I took about powers of attorney. If you wanna start updating your plan get a plan in place. Whatever it is for you I've got to educational workshops to be come to these workshops here in July. Can you wanna sit down with me afterwards to start working on your planner revising your plan you'll get an hour and a half of my time for free. That's a 300 dollar value to sit down with me to go over your planner what you're thinking out so we can come up with that vision in. For you in your family. Whatever that might be. So my first workshop. Available here in July is Wednesday the 25 of July. It here at the crews in 1430 building which is just near the corner of Bellevue. And I it's 45. It is from one to 3 PM. If you wanna come to that you could sign up on my web site. Skipped in law dot com by going to the workshop paging you can sign up there or in call my office at 720. 4402774. If the 25 doesn't work for you have got when the following week on Tuesday the 31. Now this one is space is limited. We're almost three quarters full already 'cause we've got a small room there. But if he can only make it to that one please call in soon. This one is at the lone tree library sit down in lone tree in this is on Tuesday the 31 of July from 2 PM to four Pia. So if you wanna reserve your spot there again go to the website on the workshop Ager call my office 170. Or 40. 27742. When we come back we'll continue the discussion of ten surprising estate planning mistakes stick around. This is the estate planning an elder lauer with skip Reynolds. Are we dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Welcome back everybody to view Steve planning you know realize our with me skip Reynolds thanks so much for joining me this Saturday afternoon. This is the third and final segment of the show today if you missed any of the first two segments of the show have been talking about. A common estate planning mistakes that people make. So if you wanna go back in here any of those parts of the show he can go decrease in 1430 web site. Find the estate planning an elder a lot hour and you can listen to the podcast there or in go to my website skipped in law dot com. And go under the blog page and you can find the radio show this one and pass once there as well. So wanna continue once I get through this list today but number six. Of these surprising estate planning mistakes is not planning for the death of a beneficiary. So so often. When I read people's note handwritten will holes or once they've done on their own through whatever it. You know circumstance they came across this will. A lot of times they may be didn't ask the question or what happens if one of my kids dies. Or one of my beneficiaries die duo wanted to go to their kids. Or do I want it to go back in the pot of all my other beneficiaries. Which is proportional or pro routers what we use in our circles. They haven't asked themselves those questions all they do is they say yes I wanted to go to Joey gene and Jimmy. 13 one they're 13 but they don't take the next step up and say it all wears is supposed to go if they're not there. Because unfortunately you know sometimes are kids do pre decease us for whatever reason. If you haven't taking care of it or if you lost the kidding you haven't updated your estate plan it may not be reading the way you want it to beat. You know it's Jean's gone he wanted to go to Jean's kids. Her 13 share where he won jeans 13 to now be split between the two other kids. He needed just ask yourself these questions and it needs to be in the plan. Number seven. Ownership mistakes any imbalances. Between spouses. So. Many times in a relationship been especially in if you. Are a little bit older. You know we had different defined roles sometimes in our relationships where it maybe the the sole breadwinner was was the demand. In their relationship may be mom stayed home and took care of the kids zealous her job very noble and actually does a lot for a family out. I would argue that may be even more than some of the money that comes in. But. What happens with that is let's say that dad was working and mom was staying home with the kids. Or dad made more money than moms and dads saved more into his. 401K. Or maybe he's got a pension and mom doesn't depending on what option they chose when he retired it may have certain effects. But what happens is that makes our assets not equalized meaning you know one side of the the couple has more money. What if that's the case in one's spouse has more money let's say the older spouse. Has way more in their retirement account there IRA or 401K. But I can cause an issue when we turn seven you half because that's gonna bump up our income significantly. It may accelerate the taxation of that money. Which isn't a bad thing always I think we can make detect attacks they'll wag the dog sometimes in. Those you who listen frequently have heard me rant and rave about taxes on IRAs before. But. The other thing is there is a new technique if we wanted to try to equalize out. The estate somehow or we wanted to move some of that diary money from the husband he's about to turn seven Ian have to insert killing our tax rate. To wife at least 345. Ten years younger whatever it might be there's now a technique in which we can do this. So that we can try to save some of that money on the taxation but we also equalize out the state well let's say it's a second marriage. And I wanna make sure that I get this retirement account to my spouse. So it's just not a hassle with my state plan. Whenever I pass away if I pass way first so that my kids are fight with my new spouse. Who they may or may not get along with. I can take care of it had a time. There are some ways that we can. Change the ownership. Or have. The balance things out the other thing is I've seen some times where the house is just in his or her name. And we do that because the other person had that creditor issues. So we end up having to get the mortgage and everything in just one person's name or what happens if that person dies. And the spouses and on the mortgage. Well but the mortgage company says it is she's got to qualify for the mortgage at the time that he died. Well what if she has no work experience no income can't qualify for the loans still Casilla of that credit. What happens in that house. Loops. We might have to sell it or they might foreclose on what was that something we were thinking about. We just need to cross. All of these issues off the list and make sure we may account for. Number eight. Not having a resided you wary claws are arrested what to do with the rest. This is a really common mistake. Arm when you hand write your will. So a lot of times when in people and right there will. Or do it on some online thing they will designate all of their money in what I call specific gifts. But they'll say only give 101000 too dumb friends league 101000 to you. The cancer society 101000 to use this when you give 50000 to this person of 50000 out person. Maybe assert taken off all this money well if there is more money than is in that gift in you didn't put where the rest of it's supposed to go. I now don't have the answers to that quiz. And there is it your cause deals with anything left outstanding inside of the estate. Any of that kind of money. Or assets. If you don't have it in there I don't have a plan for now. I would say you're having to go to good quote unquote family tree to figure out who it goes to and it may not be too goes intended beneficiaries. Or may not be to them in the percentages that you really want it. C need to have that receipt you wary clause or the arrest. Number nine. And it's happens all the time and and I think it is just human nature. But it's not planning for the unexpected. And it's because we live our lives saying you know what. I hope this happens or I wish this is gonna happen or this is going to happen. And I don't disagree with looking at life through that you know glass half full. Lance. The problem is that if you are looking through only the Rosie lenses and you're not taking a look at the unexpected. Which is what estate planning is really all about. I've used the analogy before it's the why you Wear a sweater or take a sweater or late Jack who when you go to Hawaii. Well it's because that one day might be cool and you want does sweater for that just in case. Well that's what estate planning is is it's just in case planning. But if you don't do proper just in case planning new hope all the stars aligned just right. Look out when one album doesn't. So some of the things that people need to account for think about is a sudden change in the health of U. Or it in your spouse if you're married and what is that going to do if you don't have is stress if you're over 65. If you don't how long term care. What is that gonna look like how fast are we gonna have to potentially run through your money was set affect gonna be on our spouse. May also leave last year spouse if you died if we're spending now money down. Is that last gonna be enough for whatever they're gonna need. Or what happens if I die in the my spouse is. Needing long term care and I was the caregiver. So now I left them more money now that money could be lost faster. About taking that into account is that something that concerns me. What happens if you had a death of a kid I talked about it you know a couple of minutes ago if it if you have a death of a kid have you planned for where you want the money to go. What happens if your if your children have creditor issues. But if there is Spencer if what if they get divorced what if they're addicted to gambling. Drugs alcohol. You name it. Have you accounted for those different types of circumstances in your plan. And I would argue to say that most people. Have not. And here's why see that just real briefly. Most people coming to me say I want my plan to be simple and with simple means to them is that I understand it. And it's what I call it here you go plan. What that means is I die I leave on myself to my kids. I wiped my hands clean up it boom it's scarce. Problem this is once it becomes theirs is now open to all of the things that I just talked about. What happens if your kid dies and they are marry who they likely to leave your inheritance to. Their spouse right. Well depending on how old your spell your child is when you die their spouse is gonna beam. Potentially likely to remarry. And now they have your money. To use however they see fit without your child. And they can share with your child 2.0. We just wanted to be simple and give it your kid. Or. They've got your kid runs in a creditor issues or bankruptcy bankruptcy in number one reason for bankruptcy these days is medical expenses. Begin divorce if they buy things with joint tenancy they may lose half of what you gave them to their spouse in their divorce. And then addictions obviously got one the more money you have the more you can do your addiction. You can only buy as much cocaine as you have money lithium more money can buy more cocaine. I either I remember a story of a guy used to work with that was financial planner and he had a kid that his death left in the million bucks kits ordered up his nose in the year use debt. Pretty sure dad didn't expect that. And then the last one not not to be released is not dealing with our own mortality. I've had many many people come into my office or come to my workshops that have said to me in their seventies and there eighties. That they haven't done there will or they haven't done any form of estate planning because they're afraid if they do they're going to die. Let me tell you harsh reality. You're gonna die anyway. Might as well planned force so it happens what do you want. Which you're assets. If any. And then it works out the way you want is not gonna speed up your death and I understand that thought process I don't have to agree with it but I understand it. All right so those are the ten mistakes a real fast. Beneficiary blunders selling property for less than its value. Naming specific investments in your will not looking at the future not thinking through a well intended gift in your state plan. Leading money directly to grandchildren not accounting for that they might be miners. Not planning for the death of a beneficiary. Owning things on equal or. Owning something you just your name and then it has to maybe go through process or may cause unintended consequences when you die. Not having a residual way cause or arrests clause in the room in your will. Not planning for unexpected things for you your spouse injure beneficiaries. And then not dealing with your own mortality. So the purpose of this issue is seek it you guys speak in about all of these stinks. If you wanna hear more about all of this in you wanna come to one of my workshops have got to workshops this month of real fast. A got one Wednesday the 25 this year at the crews in. Building from one to 3 PM on Wednesday that 25. Or Tuesday the 31 at the lone tree library from two to 4 PM. If you come one of these workshops and you wanna meet with me afterwards you'll get an hour and a half of my time. Or free that is a 300 dollar value to start looking out what your vision for your plan may be. He missed any of the show you go to prison 1430 website look for the estate planning an elder law our show. Or you go to my website skipped in law dot com click on blogs and you find this show and past shows with a short description as well. So hopefully you learned something today really appreciate you listening in this Saturday afternoon. Have a great rest your Saturday. Have a great risk to your weekend and a fabulous next week and I can't wait to talk to you next Saturday ticket. Thanks for listening to the estate planning an elder law our would skip Reynolds. Tune in next week where we talk about some great new topics this is the estate planning an elder law hour with skip Reynolds that's every Saturday from two to three on cruise in 1430. You can Reynolds is a licensed attorney in Colorado all of the stories and content of this state planning an older life hour are not intended to be direct legal advice they are for illustrative purposes only additionally no attorney client privilege has been performed with the law offices have been Reynolds LLC source you can Reynolds Esquire where to seek legal counsel before making any estate planning or elder lob city. All of the views of the guests of the show are their own and are not views of the law officers have been Reynolds LLC or skipping right over Esquire. Nor is there appearance and endorsement of goods or services for the law offices of have been Reynolds LLC were skipping Reynolds Esquire.
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