Power of Attorney, Advanced Directives, and Living Wills

Tuesday, February 21, 2012

Update Your Estate Plan!

The Only Good Estate Plan is an Updated Estate Plan.

Lately, many of my newest clients have come to me with very old wills and powers of attorney. The plan is nicely done, folded and tucked in a nice envelope. The older the will, the harder it is for me to unfold. Once I dust it off, the will done on the typewriter is readable. 

In any case, it's a relief to me when these clients visit with me and actually become clients. My thought is, at least I can help this family update their plan, because most of the time, the plan no longer reflects their wishes, values, or the realities of their family situation. 

Many times, the kids were young when you first sat down to make your will. The needs were different. The choice of executor or power of attorney may be a sibling that you no longer feel comfortable with having serve in these roles. The estate size and value have changed, as well as the types of accounts and assets you own. Maybe there has been a second, or third marriage. You get the point! 

That's why the only good estate plan is an updated one. An old estate plan may have provisions in it that go against your current wishes today. 

If you have an old estate plan, I applaud you for doing some planning in the first place. Too many people fail to plan. But now, take the next step and make sure to keep that plan updated. I recommend checking your plan every 3 years, and updating it every 5-10 years. Those are rough guidelines. If there are any major changes in your family or circumstances, update the plan immediately.

Sunday, January 22, 2012

Caution: Do-It-Yourself Wills

Is it a good idea to write your own will? I can’t answer that question without being somewhat biased, because as an attorney, I know that there are complex and unique issues that each family and individual faces. Therefore, it does concern me when I hear of someone writing his or her own will without an attorney’s help.

My mission as an attorney is to build a long-term relationship with each client and provide superior service to him or her. The stack of paper in a binder or folder that I eventually hand to my clients is not what they find valuable. They just find it heavy! So the question is, where is the value in working with an attorney on my estate plan? My clients tell me that they find value knowing that they have a trusted legal advisor that has taken the time to learn about their needs, their goals, and the unique aspects of their lives. Unique lives translate into unique estate plans.

When I hear about do-it-yourself estate planning, I can’t help but get nervous for the folks that use those products. Here’s what concerns me about folks writing their own will:

1. Failure to protect your assets: As an attorney, I always talk to my clients about their kids and grandkids, and I make sure that an asset protection plan is put in place. I want to make sure the client’s kids or grandkids are protected from themselves and others, including their creditors, spouses (or ex-spouses), business partners, legal judgments, etc. I can assure you that you cannot design a one-size fits all form for an asset protection plan, which is more important than ever today.
    
2. Failure to create an asset preservation plan: A will and power of attorney is important but only the start for many estate plans. A major concern for retirees and people close to retiring is making sure an asset preservation plan is crafted, so that if you go into a nursing home, the house will be safe and some assets will also be safe from Medicaid spend down.
    
3. False sense of protection: Doing it yourself and convincing yourself you only need the “simple will” may give you a false sense of protection, when in fact your situation is more complex. By complex, I mean things like second marriages, kids with financial issues, real estate under water, uncertain financial future, family conflicts, etc. I can assure you that these types of issues won’t go away when you pass on—in fact, our experience shows they only magnify if they’re not dealt with while you’re still here.
    
4. Legal issues and problems with the documents: Let’s be honest, you don’t know what you don’t know when it comes to estate planning. Work with a trusted advisor that knows what you need. Would you pull your own tooth? Do surgery on yourself? Estate planning and asset preservation is best done with the help of a professional.

Are you going to spend more money on an estate plan with an attorney? Yes. But do you really want the “cheapest” plan? Worse, are you making matters more complex by doing it yourself and saving a few bucks?

I make my living by being passionate about helping families deal with their estate planning goals, fears and hopes to ensure they leave a legacy they can be proud of, no matter what happens and when it happens. Think about estate planning as saving your family time, money, aggravation, conflict, and from your estate being unnecessarily spent down on long-term care. Then, the real value of working with a professional will be realized.  

Tuesday, December 06, 2011

Asset Preservation: Your HOME

Preserving your assets is possible even if you are about to enter into a nursing home. But the worst thing you can do is wait until you're no longer healthy to start planning. Instead, start planning while you are healthy!

Like most people, if you own a home, typically that's your greatest concern when you sit down to consider what assets are most in need of protection.

Consider an example: Jon and Mary, both 68, own a $250,000 home. They have two children. Neither has long-term care insurance. Jon's health is a source of concern, but his doctors are confident that based on current information, he will not need long-term care for at least another 7-10 years. This presents a great opportunity to plan in advance.

With our customized Nursing Home Protection+ Account solution, we can protect Jon and Mary's home from ever being taken if Jon goes into a nursing home. Even better, when Jon and Mary both pass on, the house won't be subject to estate recovery. In other words, their two children will be able to inherit the house, even if Medicaid wants to re-coup their costs by taking the house. 

This type of asset preservation requires special skills and must be done carefully after considering many factors.

If you're interested in this type of planning, please contact our office today. 

Monday, November 14, 2011

Estate Planning Misconceptions

This week, we have selected five common estate planning misconceptions that we often hear from our clients. 

1. Gifting the house for $1 to my kids is always good idea

Gifting your house to your kids may save some inheritance tax dollars, but there will be no “step up in basis” if the kids try to sell the house after you pass on. To put it simply, there may be more taxes due than if you just left the house in your name. Additionally, once the kids own the house, you’re on the hook if they get into any sort of creditor or marriage trouble.

2. I only need a simple will, or no will at all

Every provision in your will is important. You want your will to be perfect, otherwise it could spell trouble for your family later on. You need to speak with an attorney about what type of estate planning tool you need.

3. I don’t need a will because all of my assets have beneficiaries on them

It always makes sense to have a will, regardless if anything will pass through the will. Inevitably, we find the will always disposes of some assets.

4. A power of attorney is just a form and is the same for everyone

Powers of attorney are subject to the most lawsuits because of this assumption. Your power of attorney needs to be carefully tailored so there aren’t too many powers.

5. I can’t gift more than $13,000 per year

As it stands now, you have a $5 Million lifetime gifting exemption through 2013. You can make the $13k gifts each year without paying taxes or filing gift tax returns. Anything over $13k is not taxed, but must be accounted for. Anything above $5 Million is taxed at 35%. For years, the lifetime exemption was $1 Million, so the $5 Million jump presents a great opportunity for wealthy individuals and families to make transfers.

Estate planning should be undertaken with a qualified estate planning attorney. Everyone needs to engage in estate planning to ensure they leave a legacy that's free of conflict and confusion. For a complementary estate planning consultation, please call our office at (215) 706-0200.

Was this week’s blog entry helpful to you? If so, we encourage you to forward it on to friends and family members who you think may find it informative as well.

Have a great week!

Monday, October 10, 2011

7 Estate Planning Questions

Top 7 Estate Planning Questions That Clients Ask

1. What if I don’t have a Power of Attorney, what happens?

You need to make sure you have a Power of Attorney, no matter what age you are. If something happens to you and you can’t make decisions for yourself, you need to make sure someone is appointed to handle your affairs. If you don’t, a guardian may need to be appointed for you. That means going through the courts, something that no one wants to be bothered with.

2. Is probate a big deal in Pennsylvania? Do I need a living trust?

Probate is not the scary process that it used to be, at least in Pennsylvania. Most people in Pennsylvania opt to have a will over a living trust because probate is rather straightforward. Sometimes, an attorney may need to be retained to help with probate affairs, but many times, a family can do it themselves.

3. Why do I need a will if most of my assets are joint or have beneficiaries?

Regardless of if your assets are jointly titled and have beneficiary designations, it still makes a lot of sense to have a will.

First, you may acquire new assets or move assets around during the course of your life. You may forget to re-title beneficiaries, or you may not title the asset jointly.

Second, there are bound to be assets that WILL pass through the will! It always happens. Plus, even if that doesn’t happen, a will is important for other reasons, such as making sure you have an Executor appointed.

Finally, if you are married, a will may not be as important upon the first-to-die, but upon the second-to-die, a will becomes essential because it’s likely that many of those joint assets are no longer jointly held, and will pass through the will.

4. Where do I store my documents, and should an attorney keep a copy?

We generally recommend you purchase a fire-proof records safe for your home and store your original estate planning documents there. They will be safe, but more accessible than a bank safe deposit box. As your estate planning law firm, we keep a copy of your documents on our secure LegalVault service, which also provides you and your health care providers access to your documents.

5. Can I write my plan myself or with a LegalZoom type of service?

Of course you can, but it’s probably not a good idea. Would you skip the doctor’s office and diagnose yourself if you’re feeling sick? Estate planning is best done with an attorney who understands how all of the pieces of the puzzle fit together. Estate planning includes wills, powers of attorneys, and trusts, but it also includes strategies while you’re alive, and strategies for the next generation. Even a “simple” plan is best done with an attorney, because as of our experiences show, even the simple plans require customizations.

6. How often should I update my plan?

Check your documents at least every three years to make sure they still seem current. We recommend that you update the plan when you see a need for a change, and update your powers of attorney every five years.

7. What are the taxes at death and how do I avoid them?

There are both federal estate and state inheritance taxes. Most people today don’t worry about federal estate taxes today, because only folks with more than $5 Million of assets are affected. 

Pennsylvania has a state inheritance tax, and any asset transferred upon death in Pennsylvania is possibly subject to inheritance tax, with very few exceptions. The tax rates are relatively small (4.5% to kids and grandkids), so most of the time, planning to avoid PA inheritance taxes is not worth it. However, every case is different and we can discuss estate and inheritance tax planning strategies with you that may make sense.

Monday, October 03, 2011

Is it time for a WILL review?

Is it time to update your LAST WILL & TESTAMENT? You don't know until you review it! We've put together a few tips this week for when it's a good time for you to pull the will out of storage and give it a review. 

1. THE WILL IS FIVE OR MORE YEARS OLD: You should review your estate plan at least every five years, even if you feel nothing has changed. It's a good habit to get into, so that you can be sure your plan works for you.

2. YOU DO NOT UNDERSTAND THE WILL: If you see parts of the will you simply do not understand, you may want to get it reviewed. Chances are, some of the sections or the language may simply be out of date.

3. YOU GET RE-MARRIED, DIVORCED, OR ARE NOW WIDOWED: The change in your marital status should prompt a will review and mostly likely require significant changes to your WILL.

4. YOUR KIDS WERE YOUNG WHEN YOU WROTE YOUR WILL: Now that the children are older, maybe out of college or even married with children, you probably have quite a few revisions to make in your will. 

5. NEW GRANDKIDS: You may wish to leave grandkids a direct inheritance, or not. But either way, you should make sure your will is reviewed when you have new grandkids. If they come into the inheritance early for some reason, you want to ensure that proper plans are made.

6. YOUR WEALTH HAS CHANGED FOR THE BETTER OR WORSE: Significant changes in your wealth should prompt a review of your will. There may be new strategies, depending on what types of assets you have and what your goals are.

Do you need a review of your Last Will & Testament? Call us to schedule a no-obligation Will review at (215) 706-0200. We'll take 30 minutes of your time and tell you whether you may need an update or not.

Monday, September 26, 2011

Estate Planning Tips

This week, I reached into my grab bag for a few best practices in estate planning. Everyone must have an estate plan because without one, you risk leaving your affairs a mess for others. Here are a few tips and ideas:

1. KEEP IT CURRENT:
   Keep your Powers of Attorney up-to-date. In the event of a disability, you want to ensure financial institutions and medical providers will accept these documents without reservation. Update them every 3-5 years.
    
2. DON’T LET PROBATE SCARE YOU:
   In Pennsylvania, don’t let the probate process scare you into writing big expensive estate plans to avoid probate. Probate is a relatively easy process in Pennsylvania compared to other states.
    
3. FOLLOW THE THREE C’S:
   In your estate plan, be CLEAR, be CONSISTENT, and be CAREFUL. Make sure you’re working with an attorney who only practices estate planning so you can rest assured knowing your plan meets this criteria. Make sure the language is clear, that nothing in the plan conflicts, and that you think through what you want your plan to say.
    
4. HOPE FOR THE BEST, PLAN FOR THE WORST:
   Estate planning is about as exciting as going to a dentist for many people. No one wants to do it, but it must be done. While you’re planning, make sure you plan for the worst-case scenario. For example, leaving your son a large inheritance and the chance that he could have creditor problems or he gets divorced and his ex-wife wants half of the estate. Yes, there are strategies we can put in place to protect an inheritance from these types of situations.
    
5. GIFT PROPERLY:
   Want to downsize, help your kids while you’re still living, or take care of the grandkids? Writing a check may make them smile, but there are other ways to make gifts, such as setting up life insurance policies inside trusts (great for asset protection) and creating a pension for life for your kids. If you want to gift, make sure you explore your options with qualified professionals. Doing so may provide multiple benefits to you and your heirs.

Wednesday, September 07, 2011

Fall 2011 Estate Planning Essentials

Our blog entry this week focuses on five topics that have been hot button issues for clients over the last few months. Estate planning continues to evolve and therefore, we must continue to “think different."

Estate Planning in General: Estate planning today isn’t what it was 5 or 10 years ago. For most families that I see today, saving estate tax dollars is not an objective, because there are simply no taxes to begin with! But just because the tax problem went away (at least for the time being) doesn’t mean you shouldn’t plan. Our clients come to us to make sure their kids and grandkids will be taken care of properly, and that their estate is setup and optimized properly to achieve those goals. In other words, there are many more reasons to engage in estate planning than simply to save taxes.

Powers of Attorney: To put it bluntly, we are living longer. A Will by itself won’t suffice anymore. A Will is a death document, and only kicks in upon your passing. As we live longer, we have more time where we may be incapacitated or incompetent to make decisions. Therefore, powers of attorney, appointing someone to take over your affairs, continue to become more essential.

Long-Term Care: Long-term care costs are rising. See last week's blog entry on the latest average costs in Pennsylvania for long-term care. It is essential that middle class families plan for long-term care costs. There are strategies that can be employed to save at least part of your estate from costs that could ravage your estate.

Non-Probate Assets: More and more, people are acquiring assets that don’t pass their Will, such as IRA’s, 401(k)’s, life insurance, and annuities. In general, any asset with a beneficiary designation form avoids the Will and avoids probate. But it doesn’t mean you shouldn’t plan or protect those assets with trusts or other devices, and it doesn’t mean you should ignore them when planning your Will and estate.

Gifting: 2011 and 2012 present great opportunities to make large gifts without incurring gift taxes. You can optimize your estate plan and take care of your kids or grandkids with life insurance, pensions for life, and other great tools. Gifting may be more limited come 2013, so now is the time to act.

Fall is typically our busiest time for estate planning. Make your appointment now and reserve some time with me today if you want to optimize your estate plan. Call my office today at (215) 706-0200 or schedule an appointment online on our web site.

Monday, August 22, 2011

Powers of Attorney 101

You must have a financial power of attorney and health care power of attorney in Pennsylvania, and you must make sure these documents are updated every five years or so. It's important to update them because the older the documents are, the less likely an institution or individual will accept the documents as valid.

Why are these documents important? They allow someone to act for you if you become disabled or incompetent, temporarily or permanently.

If you don't have these documents, you are not guaranteed that a loved one or someone else can make decisions for you unless that person goes to court to get guardianship. That is time consuming, expensive, and burdensome. It is, in other words, unnecessary.

There are two types of Financial Powers of Attorney, IMMEDIATE and SPRINGING.

* Immediate Powers of Attorney: This type allow the person you appoint to act without doctors certifying incapacity.

* Springing Powers of Attorney: Here, (usually) two doctors must certify incapacity or incompetency in writing.

The problem with a Springing Power of attorney is that sometimes, people forget they have this type. When it comes time for the appointed person to use the Power of Attorney, they cannot unless they have the doctors certification. In other words, this can hold up important affairs, decisions and transactions. We're not saying that Springing POA's have no place, but often times, Immediate POA's make more sense.

Some people will ask to have a Springing POA because they don't trust the person they appoint to act properly if they have the ability to use the power of attorney right away. A Springing POA won't solve the trust issue though. Therefore, you need to start from scratch and decide who you trust completely to handle your affairs. Once you find someone you trust, then the type of POA will probably matter much less.

Monday, May 23, 2011

Financial Power of Attorney Check-Up

We caught a great article in the Wall Street Journal last weekend (May 14-15, Weekend Investor section) about powers of attorney, and how they can be dangerous if the power gets into the wrong hands, and how they could be useless if they’re old or executed improperly.

In our practice, we counsel clients to carefully select their power of attorney – trust is paramount, and if there is even the slightest doubt that someone won’t have your best interests at heart, they aren’t the right choice.

We also counsel our clients to carefully choose which powers make sense in their POA documents. Unfortunately, it is impossible to predict future needs, so we must sensibly balance what powers we should allow for. One of those most abused powers in these documents is the gifting power. Usually, we limit how gifting can be done, and how much of your estate can be gifted at one time.

The WSJ article has some tips for folks that are setting up powers of attorney. A few of them include:

• Set up your POA early, while you’re still healthy and in control.
• Keep the estate plan, including the POA, current (We recommend every 3 years)
• Check with your banks and financial institutions, to ensure the POA will be valid and accepted by the institution (sometimes, institutions have their own POA forms they ask clients to use).
• If you are often in between two or more different states, have POA’s that comply with the respective state laws. In other words, have a POA for Pennsylvania, and if you are in Florida several months per year, have a POA for Florida as well.

A power of attorney in Pennsylvania that is more than 5 years old should be updated immediately. Let us know if we can assist you, by calling our office today at (215) 706-0200.

Monday, May 09, 2011

Inheritance Protection

Make sure your inheritance isn’t squandered!

Before we can help you write your will, trust, and power of attorney, we must understand your concerns and goals for estate planning. Many people have an overarching goal—that is, they want to be assured that the inheritance they are leaving to someone isn’t squandered.

Protecting an inheritance is a crucial goal, and one that we specialize in helping people deal with every day. But protected from whom and what, exactly? Here are a few answers, and they depend on who the person is:

• If the beneficiary is a minor, obviously we want to ensure the inheritance is used for their benefit and their benefit only.
• If the beneficiary has a spending problem, substance abuse problem, etc., our goal would be to limit how the inheritance can be spent.
• Is the beneficiary in a relationship with a daughter-in-law or son-in-law that you don’t care for or have a concern about? Worried that the inheritance would go to your beneficiary’s spouse upon divorce? We devise solutions to deal with these problems on a regular basis.
• What about beneficiaries in high risk professions, such as lawyers or doctors, where lawsuits are prevalent and where the inheritance could be attached to a lawsuit?
• Special needs beneficiaries, of which 15-20% of people are, must have their inheritance put into a special needs trust if you don’t want the inheritance to be squandered to cover costs that public benefits, such as SSI or Medicaid, would otherwise cover.

These are a few of many reasons why people are coming to us every day to make sure the inheritance they leave to someone else isn’t squandered. Remember, sometimes we know of these types of issues now or ahead of time. But more often, we cannot predict what will happen in the future. Do you want to risk your inheritance being used the wrong way? We can help craft a flexible plan that ensures your inheritance will go where you want it to go.

Let us know if we can help you protect your legacy. Call today for a complementary appointment, (215) 706-0200.

Monday, April 11, 2011

Co-Executors... Good Idea?

Naming Co-Executors appears to be a convenient way to make everyone happy in the immediate future when it comes to estate planning. But choosing more than one person to serve as Executor can have disastrous consequences on your estate.

Those with two or more children are most likely to consider naming Co-Executors. The thinking behind naming all children as Co-Executors is to not offend or show favoritism to any child. However, being named Executor or not is unrelated to the inheritance that someone receives. For instance, choosing Child A as Executor, does not mean you cannot split your estate three ways, between Child A, Child B, and Child C. It simply means that Child A will be the sole person to manage and oversee this process.

By choosing Co-Executors, here are some huge potential problems:

1. Co-Executors cannot agree on fair market value of real property, causing a severe delay in closing the estate.
2. Co-Executors may not communicate well, and with each taking action, there could be overlap, conflict, confusion, etc.
3. Co-Executors may develop a short-term or long-term conflict with one another as a result of working together. If Co-Executors are both family members, this could have a lasting impact on family relations.
4. As a result of conflict or disharmony, Co-Executors may end up in court to end the dispute, and no one wants to end up in court.

Instead, our firm often finds that it works much better to name a primary Executor, and then two successor backup Executors. This ensures that the role will always be filled, and allow decisive action on your estate.

Your Will should be written clearly so that nothing is left open to interpretation. This way, there will be no question regarding your wishes that your Executor is charged with carrying out.

Lastly, naming someone as Executor should not be a secret you keep to yourself. You should inform people that you have chosen to fill roles for your plan. This way, no one will be surprised when the time comes that they need to fill the role.

Do you have a plan that you are comfortable with? For a complementary estate planning consultation, please call our office today at (215) 706-0200.

Monday, April 04, 2011

A Solid Estate Plan is Like Insurance for Your Affairs during Incapacity and Death

I cannot count how many times I have heard people say, “I don’t care what happens when I’m gone… They can do what they want with my stuff, I won’t be here!”

I could likely convince over 90% of the people who say that to me, that they actually do care, but they’re frustrated over how to plan in a practical, sensible way that ensures their estate is left in good hands.

At our firm, we view estate planning as an insurance policy for your affairs. You need to ensure that your affairs are going to be handled smoothly in the event that you become sick, incapacitated or disabled. We don’t know when or if that will happen. Our hope is that it will not. But what if it does? Do you know who will care for you and manage your affairs? Who will make health care decisions for you? Some people will respond that their spouse will do these things. What if both of you are incapacitated at the same time? Then what?

Unfortunately, those that are most vulnerable (elderly, those that are incapacitated, etc.) are often taken advantage of the most. We see it all the time in the estate planning field. Our goal is to prevent this from happening to you.

You also need to ensure that your estate is handled properly upon your death. There are many things that could go wrong if you do not have a carefully written and thought out Will or Living Trust. Like any good or service, you get what you pay for. Sure, you can pick up a Will form in your local office supply store. Unfortunately, those forms are most often a disservice to people. It’s not about how “good” the form is, or the form at all… Can a two page form really make sense of every aspect of your family? Rather, it’s about knowing the right questions to ask, and taking lots of factors into account. Every family is unique and has issues that must be sorted out. It cannot all be put neatly onto a simple two page form.

Have you given your estate plan adequate thought? Need a review of your current plan? Contact our office today for a complementary consultation at (215) 706-0200 or www.JawAtLaw.com. We are located in Willow Grove, PA in the Executive Mews Office Complex.

Monday, March 28, 2011

10 Things That Could Go Wrong Without A Plan

Without an estate plan, many things could go wrong. As always, what could go wrong depends on your situation. Here are ten quick issues that could arise if you do not have an estate plan:

1. If you have kids but have not appointed a guardian, and something happens to you (and your spouse), someone will have to petition a court for guardianship, a burdensome process.
    
2. You have no control over how your assets are divided if you don't have a will.
    
3. If you become sick/incompetent, and an end-of-life health care decision needs to be made for you, your family may end up in court if there is disagreement and discord.
    
4. The state will determine who your Executor will be. What if more than one person wants the role? What if no one wants the role? Either way, this could lead to major conflicts in the family.
    
5. Particularly for a second marriage, if you don't have an updated and carefully drafted durable financial power of attorney, your spouse could cut out your children from the first marriage, particularly when it comes to retirement accounts.
    
6. Your family could inadvertently pay more inheritance taxes.
    
7. For those that are not married, but are either engaged or in a long term relationship and want that significant other to be in control of any decisions for incapacity, etc., you MUST have an estate plan with powers of attorney and wills.
    
8. For any family, there is the possibility of a family conflict over your personal belongings if they aren't assigned to someone in your plan, or while you're still living.
    
9. Without a plan, a trust is not established for minors, dependents, and special needs beneficiaries. Only a custodial account can be created under the UTMA, and the functionality and use of this account is severely limited.
    
10. Lastly, a plan that is not updated might be just as bad, if not worse, if a lot has changed between now and the time you put the plan together.

If you need assistance with your estate plan, please contact our office today at (215) 706-0200.

Monday, March 14, 2011

A Living Will Is Not Enough

A Living Will is a document that clarifies your wishes for the very end of life. Specifically, the Living Will, also known as an Advanced Directive, tells your family, loved ones and medical professionals whether to continue life support even if all realistic options for any meaningful recovery have been exhausted.

An updated Living Will is crucial for everyone to have. Without it, you are inviting conflict, disharmony and a potentially great burden for your family. Also, without a clear Living Will, there is always a chance that a situation could develop into a case like Terry Schiavo, which lasted years because Ms. Schiavo had no Living Will.

But a Living Will is not enough – it takes care of your very end of life decisions. What about the rest of your health care decisions that must be made if you’re not competent to make them yourself?

Today, we always create a Health Care Power of Attorney (in addition to the Durable Financial Power of Attorney). The Health Care Power of Attorney appoints someone to make all medical decisions for you, hire and fire doctors and other medical personnel, etc. In Pennsylvania, most attorneys include the Living Will within the Health Care Power of Attorney document.

If you are admitted to a hospital, the staff will want to know immediately if you have these documents. You can’t carry them with you everywhere, so we highly recommend you store these documents online with our LegalVault service, and carry around an emergency ID card that allows hospitals to access these documents at any time.

By having an updated Health Care Power of Attorney with a Living Will that hospitals can immediately access with your emergency ID card, you are making it much easier for your family and loved ones to make the right decisions for you.

If we can be of assistance in updating or creating these crucial documents, or if you are interested in LegalVault/Emergency ID Card, please give our office a call at (215) 706-0200. 

Monday, March 07, 2011

Don't Forget Your Pets

Many of our clients have furry friends in their homes that offer unconditional love to their owners. For many, our dogs, cats and other animals are a special part of our family. In return, if you pass before your pets, or you get sick and can't care for them, you should really consider putting in place at least provisions in your will and power of attorney, if not a pet trust.

Here are a few specifics tips to consider when planning your estate with pets in mind:

1. Talk with someone or an organization in advance if you want that person or organization to watch after your pet in the event that something happens to you. See what they will need in order to take this job on.
    
2. Consider leaving a sum of money in your will for each pet, depending on your pet's age, medical condition and other needs. Coordinate with your estate planning attorney and financial advisor to ensure there is enough liquidity available for this.
   
3. Make sure your power of attorney appoints your agent or someone else to care for your pets. Make sure that the power of attorney allows for at least reasonable compensation for the care of your pet, and also the ability for your agent to gift money for the care and maintenance of your pet.
   
4. A pet trust may be useful if you wish for an account to be established that will provide for your pet over the rest of his or her life. Any unused funds would pass on to contingent beneficiaries or charities.

Have you thought about your pets in your estate plan? If not, please call our firm at 215-706-0200 to schedule a complementary estate planning consultation.

Monday, February 28, 2011

No Plan? Big Problems.

Don't have an estate plan? No one can force you to engage in estate planning, but without a proper estate plan, you are putting yourself and loved ones at more risk than necessary. Here are some complications that can arise when you don’t have a plan. For our readers that have not engaged in estate planning or haven’t reviewed their plan for over 3 years, now is the time to get your affairs in order.

1. Intestate Laws: Pennsylvania has an intestate law that dictates how your property and assets are divided upon death if you do not have a will or other estate planning tool such as a living trust. Dying without a will can be costly, both in potential higher taxes and family grief/conflict due to a lack of knowledge about your wishes.
    
2. Dependents: If you have minors or care for dependents or pets, you want to ensure you appoint someone in writing to be in charge of your dependents, kids or pets. You also want to make sure you leave assets, preferably in trust, to care for your dependents. If you have kids and no estate plan and they inherit assets, a custodian account will be established. Once a child turns 18, however, they are free to do what they want with those assets. Typically, an 18 year old does not have the maturity to handle their own assets.
    
3. Spendthrifts and Special Needs: If you have a spendthrift child, or a spouse or child with special needs, there are steps you must take to ensure assets don’t end up in the wrong hands (creditors, government, bankruptcy court, etc.).
    
4. Family Battles: Don’t assume your family will just sort out your affairs without any conflicts or commotion. From our law firm’s vantage point, we often hear of cases that go to court that pit family member against family member. We also know that conflicts can largely be avoided by putting together a proper estate plan. It’s just not worth the risk, or your legacy.
    
5. Incapacity or Disability: You must ensure you have a power of attorney for your finances and health care. That way, if something happens to you and you cannot make decisions for yourself, someone you trust can immediately carry on your important affairs. Without a power of attorney, sometimes a guardian will have to be appointed in court, and the guardian must continue to be supervised by the Orphan's Court. This means legal bills can pile up quickly and unnecessarily.

If you, a friend, a neighbor or relative need estate planning assistance, we welcome you to contact our firm at your convenience. You can use our convenient online contact form or call us at anytime at (215) 706-0200. We are pleased to offer a complementary initial consultation.

Monday, January 10, 2011

Living Wills and Difficult End-of-Life Decisions

We recently came across an informative and touching article about end-of-life decisions, in which the author followed the emotional stories of a few different families. The article gives rich insight and into what families wrestle with when a relative falls ill and it may be getting close to the end. The article explores when the 'end' really is, and how, with so much new medical technology in the last 100 years, the lines have been blurred.

All of our clients complete a living will that is part of a broader health care power of attorney tool. This allows each client to designate someone (a relative, friend, etc) as their health care agent, who will be authorized to make all decisions regarding personnel, treatment, facilities, etc. and who will also be the guardian of the client's wishes.

A living will is not a perfect document by any means, and in many cases today, it is difficult to determine when nothing more can be done to keep someone alive. 

We recommend that you have a clear living will with your preferences for end-of-life decisions, and also choose an agent that you completely trust and who will make rational decisions even in a time of great emotion. Sounds easier said than done. However, this is what we counsel clients on day in and day out. If you have not done comprehensive planning, we suggest you schedule a complementary appointment today by calling (215) 706-0200. 

In the meantime, here is the article link: Letting Go: What should medicine do when it can't save your life?
Appeared in The New Yorker, August 2, 2010

Tuesday, January 04, 2011

Legal Vault

The Value of LegalVault Online Storage

Our firm has recently seen a surge in the enrollment and use of LegalVault, the online document storage and information service.

People always ask us, where should I store my documents? What happens if I lose my will, or lose my power of attorney? What happens if my executor or power of attorney cannot find my estate planning documents? One of the biggest concerns is making sure a hospital and doctors have a copy of your living will and health care power of attorney if needed.

LegalVault solves many of those problems. LegalVault offers a secure web site to store your estate planning documents and any other vital information. Only you and your attorney can access all of your documents, and only your health care provider/hospital can access your medical power of attorney and living will.

One of the biggest advantages of using LegalVault is that you’re given a laminated emergency ID card to carry with you. This card provides hospitals and doctors direct access to your medical power of attorney and living will only. This solves a significant problem of you or your loved ones not having the physical documents available when admitted to a hospital, which is when the hospital usually asks to see such documents.

If you are interested in learning more about LegalVault and how to enroll, please call our office today at (215) 706-0200.

Monday, December 27, 2010

When To Plan

When is the right time to start planning your estate? It really depends on your concern, but we help a range of people plan, from those in their 20's through the 90's.

It is especially important to plan if you have young children, or are newly married. You need to ensure a guardian is appointed for your children in case something happens to you and/or your spouse. Also, you want to ensure you have adequate life insurance for your children, and a trust set up in case something happens to you while they are still underage.

If you have grandchildren, you should encourage your children to engage in estate planning if they haven’t already.

Everyone, whether you’re 20 years old or 90 years old, needs a basic estate plan, which includes a will, financial power of attorney, and health care power of attorney (with a living will).

As you build up your 401(k) or IRA, you should see an estate planning attorney to ensure that your beneficiary designation forms are properly completed, and that these accounts are coordinated with your overall estate plan.

When you get into your 60’s, you should consider seeking the advice of an elder law attorney. Medicaid laws make it very difficult to shelter assets in case a spouse goes into a nursing home today. The earlier you plan, the better.

Everyone should update their estate plan every few years, to ensure the documents are still an accurate reflection of your wishes.

As you grow older, your needs will change. You may need more advanced estate planning. Some reasons for needing more advanced planning include:

• Family member with special needs
• Family member with health issues
• Estate value grows
• Property in multiple states
• Family conflicts
• New family members
• Charitable intentions
• Asset protection issues

If we can assist you with any estate planning matters, please do not hesitate to reach out to our office for a complementary consultation by calling (215) 706-0200.

Monday, October 18, 2010

Top 10 Signs It's Time To Review Your Plan

Your estate plan should be reviewed on a regular basis. Here are ten signs that it is time to review it. If you are not sure whether your plan needs to be altered, get in touch with our office at anytime.

1. Your plan was crafted over five years ago.
    
2. You moved to a different state.
    
3. You got re-married, or got divorced.
    
4. You’ve been blessed with grandchildren.
    
5. You no longer talk to one of your kids, or you have reconnected with your child.
    
6. You are now widowed.
    
7. You have acquired significant assets, or lost substantial assets.
    
8. You don’t feel that your plan really meets the test for a good estate plan: “Give what you want, to whom you want, when you want and how you want.”
    
9. You have over $1 million in assets, or you and your spouse together have over $2 million in assets, which means there may be pending estate tax implications for you.
    
10. You’re worried about your kids, either because they spend too much, they are in a high risk profession, they may get divorced, etc.

In general, any time that an event occurs that changes your life or your family should prompt you to review your plan. We are pleased to provide a complementary consultation to you if you wish for our office to review your plan.

Let our firm assist you: Our firm offers a complementary estate plan review and consultation. Please call us today at (215) 706-0200 or email us.

Pass the word on: If you know someone who can benefit by reading this blog, please forward it on to them, or subscribe your friend or family member through this link.

Monday, October 11, 2010

Living Wills and End-Of-Life Instructions

A Living Will is not the same thing as a Last Will & Testament, which provides instructions for dividing your estate upon death. Instead, a Living Will describes your end-of-life health care preferences, and what is to happen if you become permanently unconscious and there is no hope of any recovery.

Your preferences for whether life support be withdrawn or not is only used after your health care agent and doctor(s) decide, together, that you have reached the point where there is no hope of any recovery.

Often, this is a difficult decision for many of our clients. Religious beliefs, personal feelings about death, and other considerations can affect a person’s end-of-life wishes.

It is crucial that you have a Living Will, regardless of the choices you make regarding your preferences.

Here are a few reasons why having this document is important:

• Gives your health care agent/family certainty over your preferences
• If your preference is to end your life when there is no hope for recovery, a hospital and doctor need to know
• Avoids unnecessary conflict/uncertainty/bad feelings within your family
• Gives you peace of mind knowing that you have control over this situation if you were ever to be in it.

Your Living Will should generally be reviewed every 3-5 years, and re-drafted and executed every 5-10 years. Why do you need to re-write it every 5-10 years? If you don’t, a hospital or doctor can question the validity of the document and your preferences, since they are considered outdated.

Let our firm assist you: Our firm offers a complementary estate plan review and consultation. Please call us today at (215) 706-0200 or email us.

Pass the word on: If you know someone who can benefit by reading this blog, please forward it on to them, or subscribe your friend or family member through this link.

Tuesday, October 05, 2010

Where Should I Store My Will?

Should you keep your Will in a safety deposit box at the bank? Probably not. But conventional wisdom, at least in the past, has been to favor storing Wills and Powers of Attorney in safety deposit boxes. 

It doesn't make much sense to keep your estate planning documents there for a couple of reasons:

• Banks are not open 24/7. You don't want to delay the ability for your Executor to be able to get possession of your Will or Power of Attorney.
   
• Depending on who your Executor is, he or she may face hurdles in opening the safety deposit box, particularly if they are not a joint owner of the box.
   
• How often do you check your safety deposit box? We always recommend that people review their documents every couple of years. Having them stored in a bank does not make this easy, nor does it encourage review of the documents.

We typically recommend that clients store their original documents in a fire-proof records safe at home. Walmart, Target, Staples, etc. all sell these boxes for approximately $40. This protects the documents against any wind, rain and fire damage, but allows you to access them at your convenience.

If there is concern that a family member may try to tamper with your Will, then there are alternatives to storing your documents, including our online Legal Vault service. 

Additionally, if there is great concern that a family member would tamper with your Will, or that a potential Will challenge is possible, there are other estate planning tools that can help to prevent this. 

If you have any questions about storing your Wills or Will challenges, please do not hesitate to reach out to our office.

Let our firm assist you: Our firm offers a complementary estate plan review and consultation. Please call us today at (215) 706-0200 or email us.

Pass the word on: If you know someone who can benefit by reading this blog, please forward it on to them, or subscribe your friend or family member through this link.

Thursday, August 26, 2010

Changes in Pennsylvania Powers of Attorney

Are your powers of attorney documents up to date?

Powers of attorney that are over ten years old in Pennsylvania are likely to be considered invalid, because there were major changes in the law around 2000.

Regardless of changes in the law, it is important that your powers of attorney documents don't go "stale." You want to make sure that institutions, hospitals, etc. will view your power of attorney as valid. Banks, governement agencies, etc will be hesitant to accept powers of attorney over 10 years old.

Experience tells us that powers of attorney documents, which allow someone to manage your affairs if you can't make decisions for yourself (due to disability or incapacity) are more important than a will or living trust (your death wishes). Over half of us will, at some point, experience extensive disability and we will need someone to guard over our affairs.

If you do not have a power of attorney and you become disabled, you run the risk of needing a guardian appointed by a court. Guardianship proceedings, even if uncontested, are burdensome and expensive. Guardians are then under regular court supervision. A well drafted and updated power of attorney avoids all of this. Compared with guardianship proceedings, drafting powers of attorney is simple and economical.

Everyone in Pennsylvania should have a financial power of attorney and medical power of attorney, with end of life instructions.

The law in Pennsylvania is going to change again soon, and powers of attorney language regarding gifting and retirement accounts will become more stringent, to the benefit of most Pennsylvanians. Keep a watch on this blog for any updates.

Meanwhile, please contact us to have your powers of attorney either drafted or updated today. We can be reached at (215) 706-0200 or info@jawatlaw.com.

Monday, June 07, 2010

Financial Powers of Attorney

At our office, we see many old powers of attorney documents. Typically, they’re about one to three pages each. Often, these Financial Powers of Attorney documents are missing key language in the beginning and end. Additionally, the powers that are granted to the agent are often vague.

Your powers of attorney should be customized, detailed and complete.

For instance, do you want your agent to be able to make unlimited gifts to any person or entity? Do you want your agent to be able to change the beneficiary of your IRA or life insurance policy? These types of powers can be dangerous, even with a trusted agent.

Make sure your attorney is counseling you on what is in your power of attorney. Our powers of attorney document is usually not less than twenty pages. Why? We carefully define each power, and we also include several limitations, depending on the needs of the client.

Remember, these documents need to be reviewed and possibly updated every few years. Don’t put it away and forget about it.

Wednesday, May 26, 2010

Talking To Your Agents About Their Role

One of the more challenging aspects of estate planning can sometimes be choosing our agents—who will manage our affairs when we become sick (power of attorney), and who will manage them when we die (executor of a will or trustee of a trust). Not only do we need to choose agents, but we always need to choose at least two backup agents just in case the initial agent can’t or won’t take on the role.

For some of our clients, it is easy to choose agents – maybe a husband or wife, an only child, and another close relative. For others, they just aren’t sure who to choose!

While contemplating who to select as your agent, you should really consider talking to them about the roles they will fill and also make sure they are willing to accept the role.

For your initial agent, let them know that they will be the first person to be in charge if something were to happen to you. Let them know where you have kept your original estate planning documents, and let them know if you have any copies of the documents and where they are as well. Also, let them know where they can find a list of your assets, including bank accounts, securities, investments, IRA’s, etc. They will need this information!

You should tell your agents that by agreeing to the role, they will be accepting a major responsibility, one that must be taken seriously. You must let them know that they must act in your best interests, and that you’ve put safeguards into place to make sure that occurs.

You should explain your health care preferences and end of life preferences to your agent. Even though you’ve written down your preferences on your living will and health care power of attorney, it’s still important to verbally communicate your wishes so that your agent is clear about your instructions. You should let your agent know that if you were at an end-of-life situation and you asked for “the plug to be pulled”, your agent would still have to confirm those instructions with the doctor in charge, which could be a painful decision for the agent to make.

In summary, your agent should know as much as possible now about your plan. There should be no surprises as to who the agents are, what you expect from them, and what your medical preferences are. Your agents should always be people you trust without a doubt.

Remember, make sure you review your plan every few years to make sure that the agents you selected then are the agents you would like to have listed now.

Our firm has the expertise necessary to help you choose agents, and make sure you have a well-crafted legacy plan. Please contact us today at info@jawatlaw.com or by calling (215) 706-0200 for your complementary consultation.

Thursday, May 20, 2010

Estate Planning in Uncertain Times

When I assist people in estate planning, we look at many scenarios.  We plan for the “god forbids” and hope they never happen, but if they do, that they happen far down the road. Who wants to plan 20, 30 or 40 years out when their true concern is how bad or good their portfolio will look tomorrow?

I understand. In these uncertain times (and yes, we see a recovery happening, but who knows how much or how fast?), many people are afraid to engage in estate planning. Forget uncertain times… even in good times, 60% or more of adults in this country don’t plan! It’s no wonder I get calls daily to help clean up messes on estates where the deceased person left no will.

For those that don’t plan during uncertain times, they likely believe that whatever they put on paper today, will change tomorrow. Very true. However, I approach estate planning as a lifelong process, one that doesn’t stop after the first time you create a plan. Just as our lives change on a regular basis, so to should our estate plan. If we thought about estate planning as a one-time process, we would all be in a stalemate.

Remember, what you put on paper today is not written in stone. You can always change it tomorrow. In fact, I encourage my clients to continue to update their plan (with the assistance of an attorney) whenever something significant in their lives change, and to at least review their plan every few years.

For our readers that do have plans, have you thought about your plan, and has it been reviewed and updated in the last few years? For those that don’t have plans, is it because it just hasn’t been the “right time” yet? Even in the most uncertain of times, having a plan will only benefit your heirs and loved ones. Now is the right time to update your plan, and to create one if you don’t yet have one.

Thursday, April 22, 2010

Appointing Agents -- An Important Estate Planning Component

One of the most difficult tasks in any estate plan is choosing who will manage your affairs while you’re alive and after you pass away. In addition, if you have children under eighteen, you also must consider who will step in as guardians if need be. An agent is a broad term, and emcompasses several roles, depending on what components of an estate plan you put into place. Agents include powers of attorney, personal representatives of the estate, trustees and fiduciaries.

Below are some ideas to start with on how you might go about filling these important roles. After reading this article and gathering some ideas, you should seek the assistance of a qualified estate planning attorney to help you make these decisions.

• Who do you trust? Trust is key in appointing anyone to serve in these important roles. When I think of trust, I think of a gut feeling that I have about a person. I ask, will that person have my best interests at heart when they are acting on my behalf? Finding someone you can place your trust in for these roles is easier said than done. Whatever you do, don’t simple choose someone because of convenience.
   
• Who is capable? Assuming most people are good-natured, the next question becomes, who can actually manage your affairs, your estate and your children? Sometimes, managing the affairs of someone else can be extremely complex, depending on the assets that the person has. Consider whether that person will have to hire an attorney to help him/her manage your affairs. That can get costly.
   
• Who would agree to the role? Just because you have decided to appoint someone does not mean they will agree to serve. In fact, a person filling a role can resign at anytime. Make sure the person you appoint is on board to serve.
   
• Who will the backups be? In the event that your first choice cannot serve in the role, you must make sure you have at least one, if not two trusted backups. You must make sure the backups are trustworthy, capable and willing to serve as well.
   
• When does it make sense to appoint two or more people to fill one role? Typically, I do not recommend setting up your appointments like this. Consider this: You really want to have whoever is dealing with your affairs to speak with one voice. There is much potential for disagreement and discord if two or more people are filling one role. Remember, your goal is to create a smooth transition, not hamper it even more.

In general, you should review your choices for these roles at least every five years, if not sooner. You don’t want to have outdated documents with people filling roles you no longer want them to fill, or roles they can no longer fill.

We offer complementary 90 minute consultations for estate planning issues. Call our office today (215) 706-0200 or email us at info@jawatlaw.com to set up your appointment today. Our team would be pleased to assist you in all of your estate planning needs.

Wednesday, April 07, 2010

Vital Estate Planning Documents

Only 35% of Americans have their estate plan completed, either with a will or trust. Therefore, over 6 out of every 10 people reading this have not done any planning! Instead, they have decided to let the government do their planning. Not a good idea.

For those putting off planning, you've likely been talking about planning for a while now and keep pushing it off. Being in this profession, I see way too many unfortunate circumstances where planning was not done before time was up. It is vital to put at least a basic plan in place today. Here is what you need to at least get started:

1. Last Will & Testament: The will is the document that lists your wishes after you pass. You will names your executor, the person who handles your estate, lists who the beneficiaries are (a beneficiary is the person who receives property from you), and lists any immediate family members that you have disinherited. It can also name a guardian for minor children, and list your wishes on whether you want cremation or not. Wills can be more advanced, and can include provisions such as setting up testamentary trusts so that all assets are not immediately distributed. You must have a will. If you don't, the government has what's called an intestate/intestacy statute that lists in detail who in your family will take property. You will have no control, and neither will your heirs!
    
2. Financial Power of Attorney: This document controls all of your non-medical affairs when you become disabled or incapacitated. Sometimes it is more important than having a will. These must be updated every few years or so because some institutions, such as banks, investment houses, etc, will say they are "stale" if more than 5-10 years old. This is a powerful document, giving your agent (the person who acts on behalf of you) the power to manage your assets, property, businesses, accounts, etc. It also may give your agent the ability to handle your retirement accounts (be careful with this) and to make gifts (also another one to be careful about). You can also use this document to appoint a guardian for yourself or for your children during your incapacity.
    
3. Medical Power of Attorney / Living Will: In Pennsylvania, the medical/health care power of attorney and living will can be combined into one document. The power of attorney controls while you are alive but disabled. The living will controls at the end of life phase when there is no realistic hope of recovery. This document gives the person acting on behalf of you to speak with your doctors, hire and fire your doctors, tell the doctors what to do based on your wishes, etc.

These documents are only a start to a solid estate plan. Estate planning requires a lot of thought and analysis, and takes into consideration you, your family, the legacy you want to leave and the assets that you currently own. More advanced estate planning can often be necessary to save taxes, probate fees and provide asset protection.

Finally, if you already have a basic estate plan, make sure to update it at least every five years, if not sooner.

Please contact our firm today if we may be of assistance. We can provide an economical basic estate plan that will be the foundation of a sound estate plan. Inquire about our outstanding services today.

Thursday, February 11, 2010

Updated and Accurate Powers of Attorney

Sometimes, a power of attorney is more important than your Will. A power of attorney essentially lets someone step into your shoes, to take care of your financial and health matters if you become disabled or incapacitated.

Many people have power of attorney documents, and a good portion of these documents were probably executed over ten years ago. It is important to have an updated power of attorney. Why? Your family or family circumstances may have changed. The agent listed may no longer be the agent you want. Most importantly, Pennsylvania laws and regulations have changed within ten years, adding and modifying requirements for powers of attorney.

Even if you are married, it is still essential to execute both the health care power of attorney and financial power of attorney.

Make sure your attorney carefully crafts your document and only gives the powers you want to grant. Pay particular attention to retirement plans and the power to change beneficiaries, the power to deal with life insurance policies, and gifting powers.

For a free review of your power of attorney, your estate plan or to craft an estate plan, please call our office at 215-706-0200 to schedule an appointment.