A lot of times when people think of estate planning, they think of what happens to a person’s assets after death. Thanks, in part, to cases like Stan Lee’s elder abuse saga, that term is evolving to include asset management later in life when a person’s faculties are called into question. Stan Lee, master of popular culture through his co-creation of legends like Spider-Man, X-Men, the Hulk, and the Fantastic Four is the perfect poster-person for the issue of later-in-life estate planning.
Loss of Faculties Later in Life
While the average person is not worth over $50 million like Stan Lee, we can all learn a lesson from his story when it comes to estate planning. At the ripe age of 95, Stan Lee reportedly suffers from significant loss of vision, hearing, and memory. Reportedly, his loss of faculties have rendered him incapable of making informed decisions, and the fear is that he is unable to decipher good intentions from bad. The cold hard truth is that people who are worth over 50 million will likely face the efforts of people trying to manipulate their fortunes out from under them at one point or another.
Longevity and Estate Planning
Thanks in part to medical advancements, people are living for longer than ever before. While this seems like a purely positive advancement, it does call into question what happens when a person’s faculties fade and how they can protect themselves against potential gold diggers. This issue has given rise to the necessity of including later-life planning under the estate planning umbrella.
To prevent later-in-life cases of financial elder abuse, estate planning attorneys recommend simplifying assets, revocable trusts, and trustee selection.
Simplification of Assets
When it comes to managing your assets, especially later in life, consolidation is an excellent pre-emptive measure against people taking advantage of an individual’s loss of faculties. A financial portfolio that involves one or two accounts, as opposed to several, is much easier to manage and oversee; as such, it is less vulnerable to usurpers.
Clients who have their assets in a revocable trust are protected against the type of financial elder abuse currently facing Stan Lee. What a revocable trust entails is the designation of a successor trustee appointed to take over asset management for an individual once that individual’s faculties and ability to make informed decisions are called into question. Generally, that diagnosis is performed by two licensed doctors writing formal letters stating that the individual in question is no longer able to manage their own financial affairs.
When it comes time to select a trustee, this is a decision that should be taken with the utmost seriousness and made under the assumption that their services will be needed in the future. The current situation facing Stan Lee is a sad one, especially as those allegedly trying to swindle him out of his fortune are individuals that are close to him. The selected trustee should be chosen out of altruism, rather than convenience. Common reasons like proximity or position within the family will often result in the wrong person being selected. Questions like “Will this person follow through with my wishes?” and “Does this person truly have my best interest at heart?” should be the ones to focus on.
It is an eye-opening circumstance when a pop-culture genius and icon like Stan Lee is faced with financial elder abuse. What we, the public, can learn from his case is that estate planning processes need to include what happens later in life, rather than solely after life ends. For those approaching their golden years, taking the aforementioned pre-emptive steps to ensuring their financial assets are secured could be an invaluable concept capable of providing powerful protection later in life. As always, we encourage you to contact an estate planning attorney in Corona, or Orange County to discuss your affairs.
You don’t need an estate planning attorney to tell you that divorce is unpleasant in many ways; however, in addition to the negative emotional affects with which it is associated, divorce also impacts practical aspects of one’s life. For instance, divorce can impact an estate plan in various ways, including the following:
Wills and Heirs
Even in simple divorce cases where the sole heir was the former spouse, failure to designate a different heir results in the estate, in its entirety, reverting to the state. For this reason, both wills should be amended to reflect each party’s wishes regarding who should inherit in the event of their death.
It is particularly important to restructure the estate plan if the marriage produced children, as the latter make matters a bit more complicated than if no offspring are involved. In most cases, couples draw up a will at some point during their marriage, leaving the estate to children or grandchildren, typically in the form of a trust. Nevertheless, once the marriage is dissolved, assets change. This means that new trusts must be drawn to address the change in circumstances.
If divorced individuals do not amend the terms of their trusts in a timely manner, a former spouse may still have control over children or grandchildren’s allocated shares, thus giving that person access to funds in a manner that was not anticipated or intended. For this reason, it is essential to re-examine all potential claims to family assets, for the purpose of clarifying the grantor’s intent and keeping control of a particular trust out of the hands of a former spouse.
A married couple may also place assets into living trusts to enjoy tax advantages during their marriage. As one might suspect, the court divides such shares when the marriage is dissolved. However, it is possible for the language of the document to still give a former spouse a certain level of control concerning part of the trust that would otherwise go to only one spouse. Therefore, prior to the divorce, both parties should legally divide the joint trust into two separate trusts to ensure each person can rewrite the terms of his or her trust as desired.
Although it may come as a surprise, life insurance policies are frequently overlooked for quite some time after a couple divorces, unless one partner has plans to immediately remarry. Some individuals are even under the impression that the beneficiary automatically changes once the divorce is final. However, this is not the case. Rather, each couple must contact the insurance company and ask for instructions on changing the beneficiary. Otherwise, even if the couple is divorced, the former spouse can claim the full amount of the life insurance policy.
Designating a Health Care Agent
Finally, it is imperative to name a different person to act as one’s power of attorney and health care agent. If this is not done, the person’s divorced spouse may retain power to make medical decisions on behalf of his or her former husband or wife.
Ultimately, it is wise to seek the services of a qualified estate planning attorney in Corona, or Orange County who can advise you regarding how divorce affects an estate plan and how to avoid future problems by completing due diligence at the time the marriage is dissolved.
If you have yet to set the steps to security in motion, here are 6 things our estate planning attorneys suggest that you consider as you get started along the path to securing an estate plan that is uniquely your own.
1. Have a healthcare plan.
Are you religious? Are there any certain procedures or burial arrangements that would be offensive to you spiritually? Have you made a plan that is legally enforceable… or are you simply hoping that others follow suit with what you have written? Likewise, is there someone in your family or friend circle that you trust to make decisions for you? Knowing these things can relieve a huge burden in the future.
2. Do not ignore your family dynamics.
Even if your family has a strong bond, trust administration will bring out the worst in the best of us. This is especially true if multi people are sharing responsibility. Give this some serious thought before you seal your trust administration issue and consider leaving very specific instructions that will limit the amount of family members involved in the process.
3. Have a pet plan.
What will happen to your beloved pet when you pass on? Did you know that a pet trust is a real option? Seeing as how many people have pets that are closer than family, they are often surprised and relieved to learn that they do not have to worry about their beloved pets when they pass on.
4. Keep up with changing laws.
Tax and probate laws are constantly changing. If your plan is not up to date, it can cost you and your family a hefty amount in taxes. It can even cause you to have to deal with costly probate proceedings. Trust us when we say that no one wants that, so be sure to know your laws and keep up with them as they grow and change.
5. Make sure to include life cycle events.
Remember, your trust is basically alive. This simply means that anything that has taken place in life will need to be a portion of your estate planning at some point. Marriage and death certificates, birth certificates and even divorce certificates. Have the documents that you need to coincide with your plan. To make sure that your wishes are carried out to a tee, these need to be current.
6. Update out-of-date accounts.
Even if your estate plan is up to date, that does not mean that your financial arrangements are. You will need to be sure that everything is current. This may include a change of beneficiaries or other life cycle events.
While no one likes to think about estate planning, it is a necessary part of being an adult. Whether you’re entering your golden age, or just starting a family, our estate planning attorneys can’t stress enough how important it is to set forth a plan for your estate.