How to Avoid Family Fighting in My Estate?

Many clients are eager to avoid family fighting in their estates, here is a three part process to help avoid any problems.

It’s not uncommon for parents to modify their first estate plans when their children become adults. At that point, many parents’ estate plans are designed to help efficiently transfer assets to the surviving spouse and ultimately to the adult children. However, at this stage clients are frequently eager to avoid family fighting in estates.  However, like all plans we make, sometimes things don’t go the way we want them to.

Forbes’ recent article entitled “Three Steps To Estate Planning Without The Family Friction” explains that there are a number of reasons for sibling animosity in the inheritance process. The article says that frequently there are issues that stem from a lack of communication between siblings, which causes doubts or suspicion as to how things are being done. In addition, siblings may not agree if and how property should be sold and maintained.  This is exacerbated with blended families, so see here for ideas on estate planning post divorce.  https://galligan-law.com/estate-planning-after-divorce/

To help avoid these problems, consider using this three-step process for estate planning.  Not everyone will be comfortable with all three steps, but these processes can help prevent family in-fighting in your estate.

Work with an experienced estate planning attorney. Hire an estate attorney who has many years of working in this practice area. This will mean that they’ve seen—and more importantly—resolved every type of family conflict and problem that can arise in the estate planning process.  Such an attorney can anticipate such conflicts and plan for them in the estate planning documents. That’s the know-how that you’re really paying for, in addition to his or her legal expertise in wills and trusts.

Create a financial overview. A financial overview is another part of the process to avoid family fighting in the estate.  This will help your beneficiaries see what you own and avoid suspicions between family.  A financial overview can simplify the inheritance process, and it can help to serve as the foundation for you and your executor to frankly communicate with future beneficiaries to reduce any lingering doubts or questions that they may have, when they’re not in the loop. Your inventory should at least include the following items:

  • A list of all assets, liabilities and insurance policies you have and their beneficiaries
  • Contact information for all financial, insurance and legal professionals with whom you work; and
  • Access information for any websites your beneficiaries may need for your online accounts.

As an aside, it is a really good idea to have this information gathered for your executor just to make their job easier, regardless of the potential for conflict.  You may also consider preparing a a legacy letter that discusses non-financial items for your children.

Hold a family meeting. Next, conduct a family meeting that includes the parents and the children who will be inheriting assets. Some topics for this meeting include:

  • The basics of your estate intentions (and make SURE your current estate plan reflects this)
  • Verify that a trusted person knows the location of your important estate documents
  • State who your executor and other involved people will be and your rationale
  • Make certain that all parties value communication and transparency during this process; and
  • Discuss non-financial legacy items that are important for you to give to your children.

This three-step process can help keep your children’s relationships intact after you are gone. Hiring an experienced estate planning attorney, creating a clear financial overview and communicating what’s important to you are critical steps in helping to keep your family together.

Reference: Forbes (July 2, 2020) “Three Steps To Estate Planning Without The Family Friction”

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When Do You Need a Special Power of Attorney?

A special power of attorney can help you take care of business when you're unavailable.
A special power of attorney can help you take care of business when you’re unavailable.

Yahoo Finance’s recent article entitled “What is Special Power of Attorney?” explains that with a general power of attorney, you can designate a person to make decisions when you are unable, due to illness or incapacity. A general power of attorney allows your agent (the person you select) to do almost anything related to your financial affairs that you could do, including, for example, file your tax returns, sell your house, access bank records, or sign financial contracts in your name. There are usually few, if any, limitations.

A special power of attorney only applies to specific circumstances. This is also called limited power of attorney. An agent named in a special or limited power of attorney can only act in situations included in your power of attorney document. Maybe you’re traveling or out of town when an important transaction need to take place. A special power of attorney is often used to sell property when the buyer or seller is unable to attend the closing in person. In a special power of attorney you can set limitations and conditions under which your agent is authorized to act.

You can have multiple special powers of attorney, depending on your situation. You may want to give one agent the power to run your business while you’re away and give another agent the power to sell your car.

Remember that a special power of attorney, like a general power of attorney, only applies during your lifetime. If the special power of attorney does not include a date when it terminates, it must end when you pass away. Your assets would then be managed pursuant to the terms of your will or trust, if you have either. If a person dies without a will, then in most cases the assets are distributed according to the probate laws of the state where the person lived.

Typically, creating special power of attorney involves the following:

  • Naming a person to act as your agent
  • Detailing the specific terms under which a power of attorney will take effect
  • Determining which authority your agent will have
  • Designating a successor agent, if necessary, and
  • Choosing an end date for the power of attorney to terminate

A special power of attorney is just one of the documents you may need for your estate plan. You should also ask your estate planning attorney about a last will and testament and a living trust to help you manage assets, according to your wishes after you pass away. Other critical documents include advance health care directives which state the kind of care you should receive when you can’t make medical decisions for yourself.

For more information on other estate planning documents you may need see https://galligan-law.com/living-wills-and-medical-powers-of-attorney-why-they-are-important/.

Reference: Yahoo Finance (Feb. 28, 2020) “What is Special Power of Attorney?”

 

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Helping Seniors Battle the Unspoken COVID-19 Toll: Loneliness

Isolation leads to loneliness in seniors.

Social distancing is a new term we have all become familiar with over the past several weeks. An essential step in reducing transmission of the coronavirus, it’s important to note that distancing also can cause social isolation and loneliness. Although this can affect anyone, regardless of age, the elderly are particularly vulnerable at this time.

What exactly is loneliness? We have all experienced loneliness at some time, but a more refined understanding can help us help our loved ones.  While social isolation is simply not being around other people, loneliness is a subjective feeling – a sense of suffering from being disconnected from other people. In other words, social isolation may lead to feelings of loneliness. Studies have linked these persistent feelings to higher risks of conditions like heart disease, high blood pressure, anxiety, depression and even death.

How to Help

Experts offer guidance on how we can help our elderly loved ones combat feelings of loneliness and avoid their negative mental and physical health consequences.

Some tips:

  • Help with the technology for video chats and social media.
  • Set up regular phone calls or video chats on a daily or weekly routine.
  • Explore online learning opportunities, especially those designed especially for seniors.
  • Help your elderly loved ones to change their expectations for the time being, and understand that this situation is temporary.

Resources: ABC News, The unspoken COVID-19 toll on the elderly: Loneliness, April 14, 2020.

 

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