Estate Planning for the Sandwich Generation

Estate Planning for the Sandwich GenerationWhile estate planning has always played a fundamental role in providing for one’s retirement and assisted living and/or nursing home care. These financial planning objectives are often also supplemented by concerns about taking care of family members. Some of the family issues that may be part of an estate plan include the following:

• Providing for a surviving spouse
• Financing children’s education
• Planning for the elder care expenses of aging parents
• Arranging resources for assisted living and nursing home care for a spouse or parent

The traditional duel objectives of providing for one’s future financial and health care while creating safeguards that protect family members have become much more difficult with the increasing demands on what has been referred to as the “the sandwich generation.” This term refers to those who are providing financial support and care for both a younger and older generation.

Continue reading

Using a Trust to Protect IRAs from Creditors of Beneficiaries

Using a Trust to Protect IRAs from Creditors of BeneficiariesMost people have a range of assets that comprise the bulk of their net worth, but individual retirement accounts (IRAs) and other retirement and pension benefits may be among the most significant. Although IRAs and similar retirement vehicles permit a party to simply pass the asset to loved ones and family members through use of the beneficiary designation, this is not always the safest option. Our Estate Planning Lawyers in Santa Fe often suggest that our clients consider an Inherited IRA Trust or other estate planning device especially when their beneficiaries may be subject to creditor claims.

The prolonged struggles of many families in an economy that continues to sputter along with anemic growth and massive losses in net worth because of the real estate market meltdown have made legacies from parents and grandparents an increasingly valuable component for financial security of younger generations. These adverse economic conditions also increase the probability that descendants and other beneficiaries may be struggling with judgment creditors. Because of this increased risk, the traditional approach of simply listing children or grandchildren as beneficiaries on an IRA may not offer sufficient creditor protection. Continue reading

POA Attorneys in Santa Fe Discuss Power of Attorney Options

POA Attorneys in Santa Fe Discuss Power of Attorney OptionsSometimes unexpected events like accidents or serious illness can render an individual incapable of making decisions about medical treatment or financial matters. While no one likes to contemplate these types of scenarios, there are many people throughout the U.S. who suffer catastrophic injuries or otherwise experience a prolonged period of unconsciousness. A power of attorney (POA) provides an estate planning tool for those who because of medical condition or injury are unable to exercise such decisions. While appointing an agent through a POA in New Mexico can be an effective planning tool in the event of incapacity, there are various options and issues that must be considered when preparing this type of document. Our POA Attorneys in Santa Fe have provided an overview of important information about POAs. Continue reading

Special Estate Planning Issues for Parties Who Remarry Later in Life

Special Estate Planning Issues for Parties Who Remarry Later in LifeAlthough many people do not think of a prenuptial agreement as an estate planning document, these agreements in contemplation of marriage deserve significant consideration if you are getting married later in life. An increasing number of people are getting divorced and remarried when they are fifty or older according to a survey conducted by the American Association of Matrimonial Lawyers (AAML). Over 60 percent of those who participated in a recent survey indicated that they had seen a significant increase in divorces involving spouses who are over the age of fifty. Presumably, many of these divorcing marital partners move on and remarry which poses unique estate planning issues that may make a prenuptial agreement essential. We have provided an overview of the reasons that a prenuptial agreement may be essential for baby boomers who are considering remarriage following a divorce. Continue reading

Estate Planning Strategies to Prevent Conflicts between Children

Estate Planning Strategies to Prevent Conflicts between ChildrenWhen people consider how to best bequeath their legacy to loved ones, an important consideration is maximizing the available legacy and preventing conflict between their kids to whom they leave their assets. This issue is an increasingly important issue as many baby boomers focus on developing estate plans. It has been estimated that baby boomers will leave approximately $30 trillion dollars to beneficiaries according to a report in AARP magazine, so there is a significant amount at stake when drafting estate planning documents. Our Las Vegas, New Mexico Estate Planning Attorneys have provided some tips for preempting future conflicts between beneficiaries. Continue reading

Veterinary Pet Insurance as a Component of Estate Planning

Veterinary Pet Insurance as a Component of Estate Planning The most effective estate plans address a range of issues that impact the party creating a will, living trust, or other estate planning strategy as well as the individual’s family and other beneficiaries. Financial planning for future incapacity, significant health issues associated with injury, serious medical conditions, or even nursing home care is a critical component of an estate plan. Without such planning, both the individual who needs care and his or her family members can experience severe financial hardships caused by unanticipated health care expenses. Ideally, a person who designs an estate plan also gives proper consideration to the potential for events that may cause a spouse or child to incur extraordinary medical expenses because these costs can be financially devastating and drain the resources a family needs for their monthly expenses as well as the legacy left to loved ones. Continue reading

Special Estate Planning Issues Affected by a New Mexico Divorce

Special Estate Planning Issues Affected by a New Mexico DivorceWhen parties are contemplating divorce or involved in a pending divorce, estate planning issues may not seem like a priority. However, divorce is one of the significant life events that make creating or amending an estate plan a high priority. If you suddenly become incapacitated because of a serious injury or illness, it is probably reasonable to assume that the spouse you have been fighting with in divorce court is not the person you want deciding what medical care you should receive. However, this is precisely what might happen if you do not take effective precautions to revise or create an estate plan that excludes your estranged spouse from such decisions.

Although it is important to revise estate planning documents prior to, during, and after the divorce process, it is important to obtain legal advice from an attorney with experience in both estate planning and family law. While you are certainly free to prepare a new durable power of attorney, health care power of attorney and advance health care directive, you do not have the ability to deny your spouse the right to be the beneficiary for your ERISA retirement plan. Further, your spouse will also have rights under New Mexico community property law to other assets that you may not be able to override.

There also may be changes that need to be made to your revocable trust and will in the event you might pass away while your divorce is pending. Although there are limits to your ability to deny your spouse property rights, you may wish to make changes to these documents while the divorce is pending so that your children from prior relationships or other loved ones still have a right to receive a share of your assets if you pass away. If you do not make such changes, your spouse may receive control of your property and deny your children from prior relationships a portion of your estate that otherwise might have been provided to them.

The beneficiary designation on non-ERISA accounts and other types of property held in joint tenancy with a right of survivorship also may need to be changed or your spouse may inherit assets titled in this form in their entirety if you pass away. Because parties are subject to certain limitations regarding the disposition of certain property during divorce, it is important to work closely with attorneys that have experience in both areas of law.

Making Funeral or Burial Arrangements Part of an Estate Plan

The above information is designed solely to illustrate general principles of law, and does not constitute a specific legal opinion on individual cases. We suggest that you contact experienced legal counsel for a specific opinion tailored to your individual circumstances.

If you have questions or concerns about estate planning issues related to divorce, our New Mexico Estate Planning Attorneys at Life Leaf Legal Group, PC offer a free consultation in our centrally located offices in Santa Fe and Albuquerque so that we can discuss your specific situation. Call us today to schedule your free consultation at (505) 856-3591 to learn about your rights and options.

Should “Coming of Age” Experiences Include Creating an Estate Plan?

Should “Coming of Age” Experiences Include Creating an Estate Plan?Although the phrase “coming of age” may have different meanings depending on the context and listener, it often is associated with learning to drive, discovering romantic love, exercising independence from parents and other activities that symbolize moving toward adulthood. What most teenagers coming of age do not consider part of the process is developing an estate plan. However, the age of majority, which is 18 in virtually all states, confers many of the rights of being an adult that are relevant to estate planning, such as entering into contracts, owning real property, disposing of assets, and exercising authority over one’s medical records and health care decisions.

The power to make these types of adult decisions carries an enormous amount of responsibility, so teenagers who have reached the age of 18 need at least a minimal estate plan. Granted, most teenagers do not have a significant net worth to be protected, but a basic estate plan can provide protections for a young person just starting out. If a college freshman is in a car accident while driving home from a late night study session or party, the prospect of a personal injury judgment or wrongful death judgment clouding one’s future is a sobering possibility. We have provided an overview of the types of estate planning documents and issues that a teenager coming of age may wish to consider making part of his or her estate plan. Continue reading

Why You Need a Santa Fe, NM Estate Planning Lawyer

Why You Need a Santa Fe, NM Estate Planning LawyerAlthough our Santa Fe, NM Estate Planning Lawyers use this blog to provide general information to the public, we also have repeatedly warned readers about the danger of relying on computer programs, para-professionals like paralegals, self-help legal books, and the Internet as a substitute for legal advice from an experienced NM estate planning lawyer. While conducting some research on the Internet, we came across a website where a consumer asked a very basic question, “What statute of limitations applies in my case.” Four separate attorneys who indicated that they practiced law in the specialty that deals with the substantive issue provided four different and contradictory answers. Continue reading

Steps Involved in Properly Funding a Trust in Albuquerque, NM

Steps Involved in Properly Funding a Trust in Albuquerque, NMFar too many families lose a substantial portion of their estate to the federal government in the form of taxes or creditors pursuing enforcement of judgments because they do not obtain legal advice from a New Mexico estate planning lawyer prior to preparing estate planning documents. Living trusts have become one of the most frequently used estate planning tools. Unfortunately, those who fail to seek effective legal counsel often assume that the selection and drafting of the trust agreement essentially completes the process of setting up their trust.

Until a trust has been properly “funded,” the trust agreement has essentially no value because the trust does not actually exist. A trust only provides protection once assets actually are transferred into the trust. There are some people that know property must be transferred to the trust for the assets to be managed and protected from creditors, but they lack a clear understanding of how to go about affecting the transfer. Continue reading