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:
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.
It’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.
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 email@example.com.
Following our Protect Your Pet Via Estate Planning blog last September, our estate planning attorneys in Orange County have received a number of comments and questions about how to make arrangements for pets in an estate plan. We decided to write this follow up piece to answer all of our reader’s questions, and provide a deeper insight into the process of making an estate plan that accounts for your pets.
In the US, the law classifies pets as tangible personal property, meaning that pets cannot own or directly inherit property. In fact, any money or property you leave to your pet in your estate plan will be included in your residuary estate. One of the ways to ensure your pet will continue to live a good life after you die is to make special provisions in your estate plan.
To include your pet in your will/estate plan you can either make a simple, non-legal arrangement, create a complex trust, or leave your pet with an animal welfare organization, such as the North Shore Animal League America. To include your pet in your estate plan, you first need to find a person or organization that would be willing to care for your pet after your death. Once you find a potential caretaker, you should have a candid conversation with the potential caretaker in order to address key issues such as budget and restrictions, if any.
It is worth noting that, if you decide to leave your pet to an animal welfare organization, you may need to sign some sort of agreement, as well as leave a specific amount of money to pay for your pet’s expenses. Once you find the right caretaker for your pet, you can make any of the aforementioned arrangements in your estate plan. Here is a detailed look at each of these arrangements.
A legacy arrangement is basically a program that would adopt your pet after you pass away, provided you make the necessary arrangements in advance. While these programs typically rely heavily on donations, they try to accommodate as many pet owners as possible. Examples of such programs include the SPCA, private animal shelters and rescue organizations, and veterinary school programs. If you decide to enroll your pet in such a program, include this information in your estate plan along with the contact details for the program.
A pet trust is a stronger, albeit more complicated and expensive arrangement. With a pet trust, you would not only be able to leave your pet money if it outlives you, but also a legal obligation to care for it. This means that if the caretaker fails to adhere to your instruction, he or she can face legal action. Additionally, a pet trust would ensure that the caretaker properly accounts for the money you allocate to meet your pet’s expenses. However, it is important to know that a pet trust has some disadvantages too. For instance, a pet trust is generally inflexible, meaning it is extremely difficult to alter when circumstances change.
The fluctuating prices of cryptocurrencies is a frequent topic of discussion, but how they figure into estate planning is often ignored. Digital currencies are anonymous, meaning that they do not have a listed beneficiary like most asset management accounts do. There is also no central “Bitcoin Bank” for executors or trustees to contact for further information, meaning that the information provided to heirs is literally all they will have to work with when attempting to claim their inheritance.
The first thing to remember is that estate planning is absolutely essential when considering cryptocurrency. If the owner of a Bitcoin account dies without sharing their private key with anyone, their holdings become completely inaccessible. This means that the funds within it have effectively died with their original owner. Anybody interested in including crypto assets as part of their estate for their heirs needs to be proactive about making arrangements according to their wishes.
This does not mean sharing a private key with the world. Instead, the holder of cryptocurrencies should write it down and place it somewhere secure, such as a safe or digital archive site. This arrangement makes the private key public only when necessary, giving the cryptocurrency trader privacy in the meantime.
Estate planners should also consider the tax implications of digital holdings. The IRS currently considers Bitcoin and other virtual currencies as property, just like a car or house. As such, the estate may be subject to capital gains taxes if its crypto holdings increase in value. The initial purchase price is irrelevant in these circumstances, as only the current market price and the currency’s value on the original holder’s date of death are included in the calculation.
Some states have a “Prudent Investor Act” requiring trustees and executors to diversify any significant investment, language that may be taken to include cryptocurrency holdings. If the owner of a cryptocurrency legacy wishes to pass it on in its current form, it is necessary to specifically absolve whoever is managing the estate of any liability should the “investment” go sideways.
There are additional steps that may be taken to ensure the successful transfer of digital assets. For example, all cryptocurrency holders should make a complete inventory of where their digital holdings are hosted as part of their estate planning. Some coins are stored on the exchanges or used to purchase them, such as Coinbase or Bitstamp. Any exchanges used should be written out on paper so that relevant heirs know where to look.
Alternatively, tokens may be stored within an online “wallet”. Heirs need to know the name of any wallets that may have coins and where the backups for those wallets are located to have any realistic chance of claiming their inheritance.
Finally, any devices (laptops, smartphones, etc.) used to access cryptocurrencies may have private keys saved on them. Anybody with access to these devices could take the crypto without authorization, so heirs need to protect them until the estate has been settled.
Cryptocurrencies have added a new dimension to estate planning that must be considered in all relevant circumstances.
Alzheimer’s Disease is a degenerative brain disorder that is characterized by a loss of memory and cognitive function. While Alzheimer’s disease can affect people of any age, it is most prevalent in the elderly. Identifying the factors that increase the risk of this disease is key to early detection and prevention.
There is a strong link between heart disease and Alzheimer’s. High blood pressure, diabetes and high cholesterol are also contributing factors to Alzheimer’s disease. Keeping your weight down, your cholesterol under control and your blood pressure at normal levels is key to staving off the effects of this debilitating disease.
Poor Diet and Sedentary Lifestyle
Staying active and eating a diet packed with nutrient-rich foods is one of the best ways to avoid developing Alzheimer’s. Exercising just 30 minutes a day, three days a week will help you to keep your weight under control and keep new plaques from forming on the brain. These plaques block neural pathways that allow you to retain your memory and cognitive function.
Lack of Social Connections
Studies have shown that retaining social connections helps to keep the brain active and prevent the symptoms of Alzheimer’s. To prevent the onset and progression of the disease, engage in regular social activity like attending classes, visiting friends or attending worship services.
Alzheimer’s disease has a strong genetic link. You are more likely to develop the disease if one of your parents had it. In addition, genetics can also determine when you will start developing the symptoms of Alzheimer’s as well. Early onset Alzheimers, which starts in the mid-40s and early 50s, is strongly linked to family history. If you have a relative who developed Alzheimer’s, see a specialist early so that you can prevent the onset of symptoms.
There is a strong link between substance abuse and Alzheimer’s. Studies have shown that heavy alcohol consumption can lessen cognitive function over time, leading to memory loss before age 65. People who use illicit drugs are also more likely to develop the disease. Conversely, drinking one glass of red wine daily has been shown to decrease the likelihood that you will suffer the effects of Alzheimer’s.
The most common risk factor for Alzheimer’s is age. The risk of developing Alzheimer’s starts at around age 65 and doubles every five years afterward. By the time you are 85, your chances of developing the disease are one in three. Enjoying a healthy diet, regular exercise and strong social connections can help avoid this risk or stave it off for as long as possible.
While there have been many studies that have delved into the causes and possible treatment for Alzheimer’s, there is still a large degree of medical mystery surrounding the disease. Doctors know that certain risk factors can lead to a diagnosis of Alzheimer’s, while others escape the symptoms and stay sharp well into their 90’s. Identifying the risk factors and working to avoid them is the best way to fight off this debilitating disease.