Estate planning attorney responds to “Scott’s Tots” Meme

Estate planning attorney responds to “Scott’s Tots” Meme

Following our announcement last year that my wife and I would be covering college tuition for the kindergarten class of Rio Vista Elementary School, we were truly overwhelmed by the amount of love and support that poured in from people around the world.

We were inundated with kind notes from folks who were moved by our gesture, and we were elated to hear that many people were inspired enough by our story to commit their own acts of kindness and generosity.

It wasn’t until very recently that it was brought to my attention that a story like ours had been featured in popular media recently. In fact, it turns out that season 6; Episode 12 of NBC’s hit sitcom “The Office”, chronicles the lead character Michael Scott making a similar pledge; and then subsequently not being able to deliver on his promise when it came time for those kids to graduate high school.

Recently I was approached by a younger colleague who asked me “are you aware that you’re a meme now?”

Naturally, my initial reaction was “…what’s a meme?”

After a brief but thorough explanation of the finer points of internet culture, he showed me this Facebook post:

Marty Burbank with students

I couldn’t help but laugh at the comparison. But let me assure you that in the case of Rio Vista Elementary School, this will not be an occasion where life imitates art. My wife and I look forward to fulfilling our pledge, and continuing to watch this group of special young people grow in their education.

Now that this has been cleared up, I’ll leave you with one of my favorite quotes.

You miss 100% of the shots you don’t take.”

-Wayne Gretzky

–Michael Scott

—Marty Burbank

Michael Scott Quote

Appointing The Right Trustee

Appointing The Right Trustee

Seniors with paperworkOne of the most important questions answered by the estate planning process is how to distribute your assets once you are gone. This is commonly done by having an estate planning attorney draw up a trust that holds your assets for the benefit of your beneficiaries. A trustee must be named to manage these assets, and selecting the right one is of the utmost importance.

Put simply, a trustee is the individual, corporation, or board who holds legal title to the assets placed in trust. They approve or deny each request made by a beneficiary, and write a check whenever the use of trust funds is approved. The trustee is also responsible for managing the assets in the trust, keeping accurate tabs on income, expenses, assets, and liabilities as needed.

It’s a very important job, so there are some legal restrictions on who may take it on. A trustee must be at least 18 years of age and capable of managing their own financial affairs. Almost everyone meets this minimum requirement, but you should look for more when naming a trustee.

The Traits to Look For in a Trustee

The most important thing is for the trustee to be trustworthy enough to act in accordance with your wishes for the benefit of the beneficiaries. You are handing your trustee the keys to a vault filled with valuable assets, so anybody who may abuse the position cannot be considered.

Next, your trustee needs personal experience managing the types of assets in your trust. Estate tax returns will be an issue if the trust is funded at your death, so experience with those is a plus. Likewise, Special Needs Trusts should be managed by somebody with an intimate knowledge of federal benefit programs.

A good trustee must also be organized. There is a lot of record keeping associated with trusts, including a thorough listing of all income, liabilities, assets, and expenses. These are subject to governmental review, making mistakes a potentially disastrous proposition.

The role of trustee may last for decades, making a healthy person capable of doing it for a long time the ideal candidate.

Finally, prudence is demanded of any good trustee. They are responsible for the investment decisions that drive the value of the estate, so a detail-oriented, rational thinker needs to be at the helm.

Personal or Professional?

Although your estate planning lawyer can help you form the trust, choosing the trustee is really a decision that should be made by you and your closest group of supporters. Many individuals choose a family friend to act as trustee, citing their familiarity with the family’s needs as an advantage over a professional service. Trustworthiness may also be less of an issue with somebody you know. However, this arrangement is likely to fundamentally alter the relationship between the family friend and the beneficiaries. The trustee may also allow attachment to the beneficiaries to guide their choices, acting in a manner that is not really in the beneficiary’s best interest.

A professional trustee is more likely to have the time and expertise required to manage the trust properly. They are also less likely to allow personal attachment to influence their decisions, saying “no” when needed. However, they may not have the same understanding of your wishes and needs a trusted friend does. Some opt to appoint a personal trustee and hire a professional one to act in concert for the best of both worlds.

Parting Thoughts

If you have more than one beneficiary for your trust, it pays to explain your wishes to your trustee(s) and beneficiaries before you pass on so that there are no surprises later. It may seem awkward in the moment, but really serves to maintain family harmony once funds get disbursed.

You can also change your trustee at will if your trust allows it. Otherwise, you may file a legal motion to make a change. Poor investment decisions, excessive fees, and distributions may all be adequate grounds to make a change.

Our estate planning attorneys in Corona, Fullerton, and Newport Beach know that choosing a trustee isn’t an easy process, but we hope that the tips above will make it easier for you to choose.

The Growing Cost of Long-Term Medical Care for Seniors

The Growing Cost of Long-Term Medical Care for Seniors

Grandparents holding babiesIt’s more important now than ever to plan appropriately for long term medical care. We know that it’s not a pleasant thing to have to think about or plan for, but a little planning now can save you from big problems in the future.

Certainly you don’t need an estate planning attorney to tell you that long-term care does not come cheap. Without prior planning or comprehensive medical coverage, the costs of an extended stay in long-term care can be financially devastating.

If you are approaching retirement age or are simply thinking ahead in terms of potential health care costs down the road, there are steps you can take to ensure you will have the money you need when you most need it.

Financial Planning for the Future

While it is impossible to know how much you will need to spend on health care after retirement, there are things you can do today to mitigate the risks of being left short of funds for medical care in the future. While the cost of medical care fluctuates, there are current averages that can help you predict the potential costs you could face down the road. Some of the projected figures might be surprising. HealthView Services calculates that a 65-year-old man will spend approximately $190,000 on medical care during retirement. An average 65-year-old woman is predicted to spend approximately $214,000, as women tend to live longer. These estimates are alarming to some, and they don’t even include long-term care price tags. Keeping these numbers in mind, however, does provide a ballpark figure to aim for when saving for senior medical care.

Insurance

While surveys suggest that not enough people actually worry about long-term care, those who do should consider purchasing long-term care insurance while at a young age. Premiums purchased in your 50s and 60s are likely to be much lower, as well as easier to get approval on. Current estimates report that 70 percent of seniors, 65 and over, will at some point need some form of long-term care. This is an important statistic to take into consideration when deciding whether or not to purchase long-term care insurance.

Social Security Changes

Historically, social security payments don’t always accurately account for the cost of living and inflation, which is why many question how much help it will actually provide during their retirement years. Some people actually worry that Social Security will simply run dry, but as it is funded mainly by payroll taxes, any existing workforce ensures the existence of Social Security.

The program is currently falling short, however, to the tune of benefits being cut by as much as 23 percent by 2034. As that estimate is for 16 years down the road, there is plenty of time for things to change or for lawmakers to instigate a positive amendment.

When it comes to the growing cost of long-term medical care for senior citizens, the answer is to plan ahead. Don’t make the mistake many make of assuming they won’t need any type of long-term medical care; instead, plan for the possibility, because statistics show that most people will need it at some point in their lives.

As estate planning attorneys in Corona and Orange County, we do our best to keep the public informed on issues that directly impact seniors. If you have a topic you would like us to cover on our estate planning blog, drop us a line at info@ocelderlaw.com.