If there were ever a time to consider doing an estate plan, now would be that time. This pandemic has shown us how quickly our health and livelihood can change. If you are a parent of minor children, these facts probably keep you awake at night.
Preparing a Last Will and Testament and/or a Living Trust is one of the best ways you can ensure your children will be cared for in a way you would approve, should you pass away. Without a valid plan in place at your death, your State law dictates how to divide your material possessions, who will care for your minor children (in the absence of a surviving spouse), what age those children will receive access to their inheritance, and who will be responsible for selling or distributing your items of value.
Despite these risks, most young adults don’t have even a basic Will. Megan L. McCann, estate planning attorney and partner at Davis & McCann, P. A., attributes this trend to two facts: One, young adults rarely consider the possibility of death and two, many people assume they have insufficient assets to require estate planning.
If you have children, McCann says having at least a simple Will is critical, if for no other reason than to name a guardian (the person who will provide physical shelter and care for your child) and a conservator (the person who will manage the money your child may inherit) for your minor children. “In the absence of a Will where you appoint a guardian and conservator, the State will decide who should care for your children and their assets after your death,” McCann says. She continues, “Part of our responsibility as parents is to protect our children and provide a safe future for them. By naming a guardian and conservator in a Will, you can control who provides that protection and safety for your children and their assets, if you no longer can.”
It also is a good idea to name an alternate guardian and conservator under your Will in case your original choice is unable or unwilling to act. Please be advised that the conservator need not be the same person as the guardian. Try to select individuals who you think exhibit the optimal skills for the position that you are appointing them for and whom you feel would make decisions that most closely mimic your own parenting style. It is always a good idea to get the advanced consent of the prospective guardian and conservator to ensure that they are willing to assume such a large responsibility prior to naming them in your Will. Be aware you can always revise your documents in the future to change the guardian and conservator at any time.
For more information on Estate Planning, contact Davis & McCann, P. A., Dodge City, KS. We are members of Wealth Counsel, a national consortium of Estate Planning Attorneys and focus our practice on providing clients with the best legal advice on estate planning, Medicaid and Long-term Care Planning, Special Needs Planning, Family Business/Small Business Succession Planning, Probate, Trust Administration, Real Estate Transactions, and related matters.
Q: I am married with four children and I haven’t done any estate planning. I have serious health issues and I’m concerned I won’t have time to do thorough estate planning before I die. I own a home, some investments, a bank account, two insurance policies, and a couple of vehicles. Is there a quick way I can preserve my assets for my family?
A: Obviously if you had more time, you would want to do more sophisticated estate planning, perhaps looking at ways to save on taxes or protect your children from the risk of losing their inheritance due to divorce or creditors. However, given that your health issues require you to make emergency decisions, here are a few options for you to consider:
1. Execute a simple Last Will and Testament. Your local estate planning attorney can customize the Will to your specific wishes. This document will help transfer any of your assets that do not have a Payable-On-Death or Transfer-On-Death designation. Given a medical emergency, it’s not unusual to accomplish this in days, rather than weeks. Use caution when considering online estate planning services, as most use a “one size fits all” approach. Rarely do these services adequately address your specific family needs.
2. Sign a Durable General Power of Attorney and a Health Care Power of Attorney to authorize a person whom you trust to make your business and health care decisions should you no longer be able to. With serious illness, it is not unusual for a person to be unable to speak or
The Coronavirus pandemic has forced many individuals to quarantine and work from home. A productive way to spend the extra time you may now find in your schedule is to create an estate planning portfolio. By gathering all of your pertinent estate planning information into one location, you’ll make visits to your estate planning attorney, investment advisor, tax accountant, and insurance agent much easier. To help get you started, we’ve put together a guide to organize your estate planning portfolio.
SECTION A: CURRENT ESTATE PLANNING DOCUMENTS
• Copies of any currently existing estate planning documents, including any powers of attorney
for financial or medical, living will, HIPAA, Last Will and Testament and any trust documents.
SECTION B: ASSETS
• Copies of your most recent statements for all checking, savings and money market accounts.
• Copies of certificates of deposit.
Investment and Mutual Fund Accounts:
• Copies of your most recent statements for all investment and mutual fund accounts.
Stock and Bond Certificates:
• Copies of all stock certificates.
• Copies of all bonds.
The Coronavirus pandemic has forced families to think about topics they might generally avoid; serious illness and death. Because the virus doesn’t always present symptoms in the early stages, those who are struck with a severe form often do not have time to prepare their business and legal affairs before requiring medical intervention. What can you do now to ensure that your legal and financial matters are in order? Below are some recommendations on what you or your loved one can do to keep your home and business running smoothly in case you are hospitalized or otherwise unable to act on your own:
1. Review your Health Care Power of Attorney (HCPOA). This document allows someone to make your health care decisions in the event you are unable to. You may name one or more individuals whom you trust to act as your agent(s). We recommend that you name at least one alternate agent, should your first agent be unable or unavailable to make decisions on your behalf. If you become mentally competent and able to communicate with your doctor, the authority of your HCPOA agent ceases.
2. Review your General Durable Power of Attorney (GDPOA). This document is often referred to as a business or financial power of attorney. Your agent can pay your bills, file your taxes, and conduct your ordinary business affairs. Similar to the HCPOA, you may name one or more individuals whom you trust to act as your agent(s). Again, we recommend that you name at least one alternate agent, should your first agent be unable or unavailable to make decisions on your behalf.
It is easy to become fearful and focused on the unknowns surrounding the Coronavirus 19 pandemic. Rather than dwell on the negatives, we suggest you look for ways you can help your community during this time. Here are 10 ways you can have a positive impact locally:
1. Practice social distancing and sanitation measures as recommended by the CDC and insist all members of your family do the same.
2. Call your elderly neighbors weekly and ask how they are feeling. Have a real conversation with them; ask about their family, their hobbies, etc. Do they need any groceries or medicine that you could pick up and deliver to their doorstep for them? Make sure they jot down your telephone number to use if they are concerned or just need to hear a friendly voice.
3. Turn off the television and phones and take your family outdoors. Write encouraging messages and pictures on your driveway and sidewalks with sidewalk chalk for passing neighbors to see.
4. If your community has been ordered to shelter in place, send a generous tip to the professional who does your hair, nails, lashes, massage, etc. The majority of these individuals are self-employed and will be out of income during a quarantine, with no unemployment benefits available. A gesture of good will on your part could help them weather this storm.
5. Purchase gift cards from your favorite restaurant, bar, movie theater, etc. to use after social distancing recommendations have been rescinded. Consider sending gift cards for grocery stores to individuals you know who are no longer employed due to this pandemic. Most of these gift cards can be purchased online or by calling the business, using your credit card for payment, and having the cards mailed to you.
You’ve just come from taking your elderly mother to her doctor and learned that she needs to be admitted to a long-term care facility. Your mother isn’t a wealthy woman and you have no idea how she is going to pay for long-term care. This would be a good time to consult an elder law attorney and here’s why:
A good elder law attorney can help you devise a plan to pay for your mother’s long-term care, make suggestions on ways your mother can preserve some of her assets and which assets need to be liquidated, sold, etc. If your elder law attorney determines that your mother will immediately qualify for Medicaid benefits, she will need to provide the following information as part of the Medicaid application process:
1. Non-Financial Documents
a. Identification – picture ID (driver’s license, state ID)
b. Social Security card(s)
c. Birth verification (birth certificate, baptismal certificate or school record with date of birth)
d. Marriage license or death certificate/divorce decree of spouse
e. Health Insurance Identification Card (for all insurance coverage including Medicare, Medicare Supplemental, etc.)
f. Military discharge records including original Form DD-214
g. Names, addresses, phone numbers of all children
h. Listing of assets sold or given away in the last 5 years
2. Legal Documents
a. Most recent Health Care Power of Attorney, Living Will, General Durable Power of Attorney, Will
b. Trust documents
c. Business entity/partnership agreements
d. Resident admission agreement (if in assisted living or nursing home)
Rumors, gossip and hearsay are your worst enemy when it comes to long-term care planning. Many people delay planning because they hear one thing or another from a family member or friend, but they never take the time to investigate whether the information is accurate or if it even applies to their own situation. Before you assume you won’t qualify for Medicaid benefits for nursing home care, or wouldn’t benefit from long-term care planning, do yourself a favor and visit an experienced elder law attorney to get the FACTS. In the meantime, here are a few common long-term care misunderstandings held by many clients:
1. To qualify for Medicaid benefits, I must get rid of all my assets. False. In Kansas, although you’re not allowed more than $2,000 in “countable assets” to receive Medicaid, not all of your assets are counted toward computing your eligibility. For example, in Kansas, your house is an exempt asset so long as your spouse resides there or there is a chance that you will return home. Other exemptions include assets that can’t be converted to cash, burial plots, business or income-producing property, household furnishings, personal property, pre-paid funeral plans and a vehicle. Further, if you are married, your spouse (a/k/a well-spouse or non-applicant) may keep a portion of your countable assets as his/her “community spouse resource allowance”. However, something everyone should keep in mind, is that many of the aforementioned assets lose their exempt status after death.
Dementia is a frightening diagnosis for any family.
The life expectancy for an individual with dementia can vary greatly depending on the exact diagnosis but patients routinely live more than five, eight or even 12 years after they first begin to require full-time care. These numbers vary depending on the individual and advancing treatments but they give you a better idea of what you might expect should you or a family member receive a dementia diagnosis.
Even with the best of intentions to receive care at home, very few family members are equipped to provide the health and safety needs of a patient with advanced dementia. As a result, most dementia patients end up needing full-time nursing home care. Will you be financially able to pay for that care?
In Kansas, the average annual cost for around-the-clock care in a nursing home, with a semi-private room, is a little over $65,000, according to a 2019 Genworth report. This means that an individual needing eight years of full-time nursing home care would pay more than $520,000 over that time period. For many families, this equates to most or all the wealth they have accumulated over their lifetime.
Medicare does NOT pay for long-term care in a nursing home. It will cover some expenses related to temporary admissions, but not long-term care. Medicaid is the State agency that provides payment for long-term care but only individuals who have less than $2,000 in countable resources are eligible. The application process for Medicaid can be confusing and time consuming. That process is even further complicated if you feel you have been unfairly denied Medicaid assistance (a common event, even for clearly qualified applicants).
Have you ever experienced the frustration of forgetting a password or login information for one of your online accounts? The process to regain access to your account can be maddening. Now, think about what your loved one might experience if they need to gain access to your accounts after your death. Would they know where to begin? Have you provided a trusted friend or family member with a list of your digital accounts and passwords, or at the very least, provided them with the location of where that information is stored?
In today’s digital age, you must remember access information for not only social media and consumer sites, but also highly sensitive accounts with banks, investment firms, accounting and tax services, and credit card companies. By creating a digital asset plan, you can create a quick reference source of login and password information for yourself, and help your family locate and access your accounts should they need to do so after your death.
How should you create a digital plan?
1. First, create a digital inventory. Your inventory may look something like this:
• An itemized list of computing hardware, such as personal computers, external hard drives or flash drives, tablets, smartphones, digital music players, e-readers, digital cameras, and other digital devices. It is a good idea to reference the location of each item, the corresponding operational manuals, and warranty information.
• List all data that is stored electronically. Detail whether that information is stored online, in the cloud, or on a physical device. This data might include family genealogy, health records, photos, personal and business contact information, educational and military service information, etc.
• List online accounts, such as email, social media accounts, shopping accounts, photo and video sharing accounts, online storage accounts, and websites and blogs that you may manage.
• List domain names you own and expiration/renewal dates for the same.
NEWS YOU CAN USE
Davis & McCann, P. A.,