The best laid plans can go awry

As a specialist in family wealth challenges which encompasses estate planning, I am often surprised at the initial response of clients to my question as to whether they have an estate plan. Frequently, they assume that their set of legal documents are sufficient to answer that question “yes,” but all too often, it’s not. Most do not know what will happen with their estate and whether what is in place will cover the concerns of greatest consequence to their particular situation.

I was reminded of this when reading a recent post by Rick Johnson titled, “Routine Advice Makes for Difficult Choices Later,” on his blog “Keep Your Assets. Take My Advice.

In the article, Johnson sets up the scenario: “I still meet people who have no wills, or worse wills that they have not updated in over a decade. Then, of course there are the people who have gone to an attorney’s Living Trust Seminar. Generally, they get a Living Trust completed and think everything is fine. I am amazed to see these client’s of local attorneys who have Living Trusts, but have not transferred any of their assets into their new Living Trusts. However, what if you do not die, but rather have a prolonged illness that requires Long Term Care?”

In the end, he notes: “Here is the inescapable truth: If you do not plan, then you will pay out of our own pocket. With proper planning however, there are things that you can do to protect your assets.”

The key is “with PROPER planning,” which is something that can be glossed over in these times of internet wills and seminar trusts.

Working with an estate planner can help you avoid the situation that Johnson further explains: “A lot of older Living Trusts and Wills were what is known as “I Love You” trusts or wills. This means that the husband leaves everything to the wife and the wife leaves everything to the husband, then when they both die, everything goes to the kids. There may be reasons why leaving everything to your spouse could be a bad idea. Especially, if your spouse has qualified for Medicaid and is in a nursing home. Suppose the healthy spouse dies and leaves everything to the Medicaid patient husband in the nursing home! Yikes!!! This would be an irrevocable scenario where the family would receive nothing until after Medicaid was fully reimbursed.”

We can help you develop a financial and estate plan that will truly work for your needs and your family.

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