Monthly Archives: October 2012

I Know I Should Have an Estate Plan, But How Much Planning is Enough?

Just about everyone knows he or she should have an estate plan, but how much planning is enough? When is a basic estate plan sufficient, and when should a more complex plan be put into place?

Is a basic estate plan right for me?

Generally speaking, a basic estate plan may be the right choice for you if:

1) You are relatively young and in good health. If you are creating a will for the statistically unlikely event that you don’t beat the odds, you may not require a complicated estate plan if you meet the other criteria below.

2) Your current and expected estate (including life insurance) does not approach $1 million. While the current federal estate tax exemption is higher than that in 2012 (approximately $5 million), it may drop to $1 million in 2013 if Congress does not act. In addition, the state estate tax in Connecticut is $2 million and in New York is $1 million.

3) You do not require any specialized planning. If you wish to engage in complex planning or have a particular situation that needs greater care (such as a special needs child who may benefit from a special needs trust), you may want to consider additional steps beyond a basic estate plan.

4) You do not own a business or family entity.  Family-owned businesses and entities can pose special succession issues, including valuations, liquidity and control, that require more advanced estate planning.

5) You and your spouse or partner (if any) do not have children from another marriage/parent. If there are sufficient assets involved, families with children from previous marriages or conceived prior to marriage often benefit from special arrangements to direct that their children, and not a current spouse’s family (upon his or her death), ultimately receive the inheritance a parent intended when drafting the will.

6) You do not intend to create a complicated list of specific bequests. If you intend to make specific bequests of certain assets, such as a car or a treasured painting, these can be done with a basic will. By contrast, if you have twenty cousins who should each receive one piece of jewelry, one artwork, 1/20th of your book collection and so on, you may want to bolster the language of your will to maximize harmony among your heirs and assure that your wishes are respected. Specific bequests can get complicated, need to be specifically documented and can cause will contests, disagreements or simple family bitterness if heirs are unclear about what they should have received or feel cheated by the “process”.

7) You have no reason to expect a will contest. If you intend to leave your estate in a manner that will anger or incite certain would-be heirs or have other “surprises” in your will, you will want to draft the will provisions extremely carefully to mitigate risks of litigation over your estate. For example, you may leave your estate to a non-marital partner rather than family members, which could generate friction after your death.

8) You are not concerned about generating immediate liquidity for your family. If cash could be tight in the event of your death, and you want to quicken the probate process, you may consider putting a revocable living trust into place in addition to a will. Any decision to create a revocable living trust or other trust should be based on a holistic approach to your estate plan.

9) You are not concerned about the public nature of the probate process. Trusts generally preserve your privacy, with some exceptions. Wills do not.

10) You do not expect any of the above factors to be relevant in the near future. Unless you plan to review your estate plan on an annual basis (and actually do it), you should create a plan that will not need to be revised based on facts that may come into being in the next three to five years. For example, you may be expecting an inheritance that would put your own estate closer to $1 million or be considering a remarriage with children involved. While it is always a good idea to keep in mind your situation and potential changes in law that might affect your estate plan, if you know that one of the above factors is likely to occur soon, you should plan ahead so that the time, emotional investment and money that you put into creating the plan pays off as you expect.

The information above is general in nature and may not be optimum for your individual situation. Please contact me or another qualified estate planning attorney to determine the best estate plan to fit your needs. The enclosed also appears on my website at www.MyStarterWill.com. MyStarterWill is a trademark of Anne Marie Segal.

Law Office of Anne Marie Segal provides estate planning advice and other legal counsel to businesses and individuals. None of the information posted on this site constitutes legal advice or forms an attorney-client relationship. This is a public forum. Please do not post confidential or fact-specific information regarding your legal questions on this site.

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Seven Top Reasons All Single Parents Need Estate Plans

With every time crunch and other obstacle a single parent must face, estate planning may seem like a far-flung concern or something only needed by the wealthiest of parents. Nothing could be further from the truth. As a single parent with moderate income and assets, your child(ren) need to keep every penny possible that you worked so hard to earn! Here are seven top reasons – aside from taxes and special needs – that even a basic estate plan will save your family headache and heartache down the road.

1) You can name a physical guardian. In your will, you can designate who your minor child’s guardian will be in the event there is no longer a living, available and appropriate parent. If your former spouse passed away, your child’s other parent is no longer involved with the child or there is a history of abuse or other reason to designate a non-parent guardian, this is especially important. (And in cases of abandonment or abuse, you should leave additional information and evidence separate from your will, if possible, to support your election of a non-parent guardian over the living parent.) Without your designation of a guardian, a probate judge will make his or her best guess on who is the best person for the job, which may or may not accord with your wishes or the actual best interests of your child.

In the case where your former spouse would ordinarily be guardian of your child in the case of your death, it is still advantageous to appoint a guardian. For example, there could be situations where he or she is unwilling or unable to serve as a guardian (including if he/she predeceases you).

2) You can name a property guardian.  In addition to naming someone as a physical guardian to care for minor children, you can also designate who will take care of your child’s financial affairs. This person may or may not be the same individual who serves as the physical guardian. For example, your son or daughter’s other parent may be his or her physical guardian after you pass away, but you may designate your sister or brother to be a property guardian for the assets you have left behind. Without designation of a property guardian, the child’s custodial parent would have control of your estate assets.

3) You can set up a trust or custodial account. You may choose, after considering the options, to set up a trust or custodial account to manage the assets on behalf of your child and designate ages and conditions for which your child will receive the principal in the trust or account. A typical age is 25, for example. You may also wish for the child to receive equal shares at different ages so that if he or she does not properly manage the first influx of cash, there is another opportunity. Without a trust or account, your child will have unfettered access to any estate assets at age 18, which is probably not the most opportune time to make the wisest financial decisions.

4) Your estate will not need to pay to bond the administrator. If you die without a will (or if you do not waive the requirement in your will), your estate’s administrator (or executor) will need to be bonded for each year that your estate is in probate. This surety bond could drain hundreds of dollars in probate costs from your estate.

5) You can plan for incapacity or other health emergencies. None of us likes to imagine that we won’t be available for our children whenever they need us, but every day things do happen. As part of your estate plan, you can determine who will take care of your medical and financial decisions if you cannot do so yourself due to incapacity or another disability. Significant funds can be depleted on delay and wasted efforts if you do not plan ahead for this possibility, however remote.

6) You or your attorney will review your beneficiary designations. Have you checked that your former spouse, for example, is no longer listed as the beneficiary of your 401(k)? If you have more than one child, are they listed as co-beneficiaries (assuming this is your intent)? Are you sure? In the course of reviewing your documentation, you may be surprised what you find (and want to change).

7) The very act of estate planning will get your financial paperwork in order. As a single parent, you (usually) do not have another partner who knows the financial details of your life. Where is the information to claim life insurance? Where are the stock certificates and 401(k) account statements? Where is the safety deposit box key? As you work through the questions posed by your estate planner, you will have an opportunity to consider what information you need to document and where to best keep it available yet confidential in case your estate executor needs to find it.

Single parents, if you have read this post to the end, pat yourself on the back! You probably already know that life can throw a few curve balls your way. By educating yourself about estate planning, you have taken an important step to assure your children’s future. I wish you all the best.

Law Office of Anne Marie Segal provides estate planning advice and other legal counsel to businesses and individuals. Please visit www.amscounsel.com or MyStarterWill.com for more information. None of the information posted on this site constitutes legal advice or forms an attorney-client relationship. This is a public forum. Please do not post confidential or fact-specific information regarding your legal questions on this site.

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Q3 2012 Client Newsletter – Law Office of Anne Marie Segal

3rd Quarter 2012 Client Newsletter
LAW OFFICE OF ANNE MARIE SEGAL
Anne Marie Segal, Esq.

October 1, 2012

Dear Clients and Friends:

As you know, I opened my doors on May 1 of this year. It has been a quite busy summer and third quarter! Here is some news that I would like to share.

Connecticut Bar Admission – November 2012

First and foremost, I am happy to announce that my efforts this summer to prepare for the Connecticut bar exam have paid off. Thanks for all of your support and good wishes. On November 5, 2012, I will be sworn into the Connecticut bar and available to represent clients throughout the state.

Stamford Office

In late 2012, I plan to open an office in Stamford, CT. I will circulate my new office address and contact information closer to the date. My phone and fax numbers, email and website will remain the same.

Business Law and Blog

As you may know, my main practice area continues to be business law. In September 2012, I launched a blog devoted to business law concerns.  Here are links to some recent posts:

Preserving Limited Liability as a Single-Member LLC: Some Crucial Considerations

The Effectiveness of a Non-Compete that is “Subject” to an Employment Agreement: Why Legalese Isn’t Always a Waste of Time

If you would like to receive my blog posts by email, please let me know or click on the “Follow Blog via Email” widget on the right hand side of the blog.

Estate Planning

I am also launching an estate planning practice this year and am available to plan medium-sized and small estates in New York and (as of November 2012) Connecticut. I am very excited about this practice area and will work diligently to design a plan that fits your needs. As part of your estate-planning package, we would want to include the following documents:

-       Last Will and Testament
-       Durable Power of Attorney
-       Health Care Proxy
-       Living Will
-       Advanced Guardianship Directive (if you have minor children)

We would also discuss whether a trust, such as a revocable living trust, would be advantageous for your particular situation and check that your non-probate assets properly designate your intended beneficiaries. Estate planning is available and recommended for individuals, single parents and couples with or without children. In particular, parents are encouraged to appoint guardians for their minor children and consider how your assets will be best managed to provide for them if you are unable to do so personally. Please call me to set up a complimentary introductory session to discuss your estate planning needs.

As I say on my website, my goal is to educate my estate planning clients and help them plan just enough – not to overplan and cause unnecessary upfront legal expenses, not to underplan and cause undue complications or tax burdens, but to try to “get it just right” for you.

Art Law

If you an artist or otherwise involved in the art world and would like information about my art law practice, please click here to visit my website.

Spanish-speaking Clients

Please note that I am available to provide legal services to Spanish-speaking clients, in case you have friends or colleagues who would benefit from a Spanish-speaking attorney in my practice areas. Spanish-speaking clients may call me directly at 203-564-9864 to set up a free initial consultation.

“Client Loyalty” Rates

[Rates revised since the date of this post]

Thanks again, and have a wonderful fourth quarter!

-Anne Marie Segal

Admitted in New York, 2001
Admission pending in Connecticut, 2012

Law Office of Anne Marie Segal provides legal counsel to businesses and individuals. Please visit www.amscounsel.com for more information. None of the information posted on this site constitutes legal advice or forms an attorney-client relationship. This is a public forum. Please do not post confidential or fact-specific information regarding your legal questions on this site.

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