Spring Cleaning For Your Legal and Financial Affairs

Spring has officially sprung and that means it’s spring cleaning time. Shake out the rugs, clean out the cupboards, and get your legal and financial affairs in order.

For plenty of folks, it’s easy to know what to do when it comes to home organization, but the idea of legal and financial ordering can be complex and confusing.

This article will give you a few places to start:

  1. Review Your Beneficiary Designations

Request updated beneficiary designation forms from your life insurance account and retirement account custodians. Look at the form and identify whether you have a minor designated as either a primary or contingent beneficiary. If you do, those assets will be tied up in Court, unnecessarily, and may not be available to the people you’ve named to care for your children.

Consider designating your life insurance and retirement accounts to be distributed to a trust for the benefit of your heirs, providing Court and creditor protection, and ensuring your children do not inherit money before they are properly prepared.

  1. Update Your Family Wealth Inventory

Your Family Wealth Inventory is where we document the assets that you own, so that in the event you become incapacitated or when you die, your family will know how to find what you own.

Without an updated Family Wealth Inventory, your assets could be lost to the state department of unclaimed property. There’s currently FOUR (4) billions of dollars of assets in our state department of unclaimed property because most people do not leave a clear record of their assets at the time of their incapacity or death.

  1. Consider If You Need to Name New Guardians (Long or Short-Term)

Review your guardian nomination designations. Have you named guardians for both the short-term (local) and the long-term (people you would trust to raise your kids fully)? If so, do they need to change? Is there anyone you would wish to exclude? Does the ID card for your wallet need to be updated? This is the time to check.

  1. Check Out the Title to Your House

Get a copy of the deed to your house and make sure that your trust is listed as the owner on the deed, if you want your house to stay out of court in the event of your incapacity or death. If you see your personal name on the deed, and there is not a trust listed, you can be sure that would result in your house having to go through the court process of probate in the event of your death. If you don’t want that, now is the perfect time to spruce up your planning.

  1. Come In and Meet With Us For a Family Wealth Planning Session

Last, but far from least, this is the perfect time of  year to come in and meet with us for a Family Wealth Planning Session, whether you’ve done planning in the past or not.  We will have a 2-hour working meeting that will get you more financially organized than you’ve likely ever been before (unless you’ve already done planning with us) and give you the confidence of knowing you’ve made the most empowered, informed and educated legal and financial decisions for the people you love.

This article is a service of Gratia P. Schoemakers, Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love.

Call our office to schedule a time for a private conversation about your family wealth via a Family Wealth Planning Session, where we can identify the best ways for you to ensure your legacy of love and financial security for your family.

Watch Out for This Predatory Phone Scam

Today, even the most conscientious can fall victim to phone scams. Claiming everything from free cruise vacations to astonishing tax rebates, phone scammers prey on the financially vulnerable, but that’s not all. As scammers become more sophisticated and find clever ways to elude legal consequences, new and convincing scams are on the rise.

A recent phone scam asks unsuspecting callers seemingly harmless questions such as, “Can you hear me?” to illicit easily recorded “yes” answers that are later used to authorize charges. Some callers who’ve later denied such charges have even been threatened with legal action, making this one of the most predatory phone scams yet.

Now that you know, tell your adult children and elderly parents what to look out for so they don’t fall victim to a scam like this. Instead of answering “yes” to a “can you hear me” caller, respond with “who is calling” instead.

Once they happen, dealing with scams isn’t easy. It can feel embarrassing and as if you should have known better.  Accepting that you didn’t and having compassion for yourself is the first step. Then, call us so we can help.

Reluctance to seek help can make you an easy victim. That is why it is so important to know where to turn for help if you or a family member has been scammed. Call us and let us support you to know where to turn, and how to recover your losses, limit your future liabilities and put effective protections in place for the future.

The truth is, anyone can fall victim to a scam. To really know better, you should never be embarrassed about seeking help. A trusted legal advisor, such as your Personal Family Lawyer®, can be there to protect what is most valuable to you throughout all of life’s challenges.

As your Personal Family Lawyer®, we provide the support and guidance you need to make sound financial decisions and establish robust legal protections that ensure your assets are protected from scams and fraud of all kinds. If you aren’t already a client, come in for a Family Wealth Planning Session to make the most empowered, informed decisions for yourself and the one’s you love. Before the session, we’ll send you a Family Wealth Inventory and Assessment™ to complete that will get you clear on what you own, what matters most to you and what you need to do to protect all of it.

This article is a service of Gratia P. Schoemakers, Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today at 832.408.0505 to schedule a Family Wealth Planning Session or schedule this session online right now!

The Four Tricky Cons of 2016

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The Four Tricky Cons of 2016 – Beware of Unknown Callers

Electronic technology has brought about tremendous benefits for today’s society. We can access goods, services, and information, all at the touch of a button. The flip-side of that coin, however, is that this same technology has also spawned countless new opportunities for dishonesty and crime.

It is unlikely that any person who has a telephone, cell phone, or computer has not been the subject of an attempted criminal act, or at least of a scam that may precede an actual crime.

According to a survey by True Link Financial, approximately $12.76 billion is stolen from older Americans each year through identity theft and scams. To help protect yourself, be aware of the most common scams out there.

“I am Calling from Microsoft Tech Support.”

If you receive a call from someone saying they are from Microsoft and a problem has been detected on your computer, don’t believe them. Microsoft does not make these types of calls. The people making the calls are trying to lead you to a website that will unleash malware designed to steal your usernames and passwords for online accounts where they can access your banking and credit card information.  If the caller gets you to go to a website, it may look very official, but remember, Microsoft will never contact you this way.

“I am Calling from the Internal Revenue Service. “

According to the AARP Fraud Watch Network, this is one of the most often-reported scams. The caller will state that you either owe back taxes that must be paid immediately or that you are due a refund that can be collected online. In either case, the goal is to get you to a website that will launch malware on your computer in an attempt to seek your financial information and bank account numbers or that will facilitate the theft of your identity. The caller will likely sound very authoritarian and may even be able to state the last four digits of your social security number. Even if the caller gives you a number to call to “verify” that the call is from the IRS, or gives you a “case code number,” don’t participate. Like Microsoft, the IRS will never initiate contact with you by phone. Instead, it will always send a communication through the U.S. Postal Service.

Calls from No One

A common precursor to scam calls is a call on your phone where no one speaks. You may hear clicks on the other end. However, rather than assume it was a wrong number, assume it was an automated call to validate a working telephone number that can be called later by a scammer. It is best to have caller identification on your phone, and you may not want to answer calls from numbers you do not recognize.

Chip Cards

The new chip cards for debit and credit use are much safer than magnetic swipe cards in that they change the code each time they are used. While that provides more protection when a retailer suffers a data breach, scammers are catching up quickly and using new and different tactics. They will send emails pretending to be from your financial institution stating that financial information must be provided via a particular linked website. The link will cause malware to be released which searches your computer for account numbers, passwords, and other financially sensitive information.

The best rule to follow in thwarting scammers is never to navigate to a website or click on a link when directed to do so by an unsolicited caller. If you receive an e-mail or phone message asking you to call a number, don’t call that number. Instead, locate the appropriate number for the entity and call that number to determine whether the communication was legitimate.

Yes, technology makes things much easier for us, but it also makes us more vulnerable. It is best to proceed with caution in all things financial and put the brakes on when things do not seem to add up. That is where we can help. You see, we do not just prepare estate planning documents for our clients and send them on their way. We develop ongoing, lifelong relationships which facilitate our clients’ protection and prosperity in ways traditional estate planning law firms don’t – and quite frankly, won’t. We are here to support and advise our clients about more than just their estate plans – like a “suspicious” phone call from the IRS, for example. If that sounds like the kind of relationship you would like with your lawyer, give us a call.

This article is a service of Gratia P. Schoemakers, Personal Family Lawyer,®  who develops trusting relationships with families for life.  That is why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you have ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a time for us to sit down and talk because this planning is so important.

What to Do With a Cash Windfall

Many of us like to fantasize about winning the lottery. We muse with our friends about how we might spend the money, and we dream about never wanting for anything ever again.

The odds are against us, of course, at least as far as the lottery goes. But that doesn’t mean – at some point in our lives perhaps – we won’t actually come into a major amount of cash, usually in the form of an inheritance, or perhaps through the settlement of a legal claim.

Planning before receiving such a windfall is critical, if you want to keep it and have it provide for you for the rest of your life and for your loved one’s after you are gone.

Most people who receive a windfall lose it almost as quickly as they receive it.

If you see a windfall coming your way, make these plans:

  1. Consider putting any large windfall you receive into an asset protection trust, first and foremost. You may even want to consider appointing a co-trustee to govern the trust alongside you so you can honestly tell friends and family that you do not have unrestricted control to your assets when they come asking for handouts.
  1. Hire an advisor you trust to help you invest the assets you receive in a manner that is aligned with your values and will support you to use the windfall to support the long-term life you desire; if you need recommendations to a trusted investment advisor, contact us.
  1. Get all of your own estate planning documents updated, including your Will, Revocable Living Trust, Health Care Directives and Power of Attorney, plus establish a relationship with a personal lawyer so if and when anything happens to you, your family will be supported to stay out of court and out of conflict.

If you anticipate receiving a windfall and need legal assistance, or if you’d like to ensure your family stays out of court and out of conflict if and when something happens to you , schedule a Family Wealth Planning Session,™ during which we can review your wishes.

This article is a service of Gratia P. Schoemakers, Personal Family Lawyer,®  who develops trusting relationships with families for life.  That’s why we offer a Family Wealth Planning Session,™ where we can explain financial management techniques and help identify the best strategies for you and your family. You can begin by calling our office today to schedule a time for us to sit down and talk because this planning is so important.

 

 

 

 

The Top Three Things to Know Before You Sign a Residential Lease

If you own your home or you’ve been renting so long that this information is old hat to you, consider sharing the details with a young adult or almost adult in your family who would benefit from this knowledge. One of the best ways to pass on your family wealth is to pass on the little things that are second nature to you, but will be a steep learning curve for the next generation.

Number 1: What Will My Total Cost Be and When Is It Due?

You would be surprised how many people sign leases without understanding all of the associated costs and when they must be paid. Renting a new apartment or home is exciting, and it can be easy to gloss over the document and jump straight to the signature line. Most tenants think about obvious costs, such as monthly rent and typical utilities. However, some leases require tenants to pay less obvious costs, such as application fees, credit check fees, parking fees, and optional service fees, such as cable and Internet. Review your lease carefully and compare leases from different landlords–what may seem like a better deal may not be after everything is taken into consideration.

Be sure you know what the deposit is, what will be necessary to get your deposit returned after you move out, when your rent payment is due and what the late fee is if you are even one day late.

Number 2: What Rules and Regulations Will Apply to Me?

Many landlords impose rules on their tenants, particularly those living in close quarters, such as apartment buildings. More common rules include mandatory quiet times, as well as prohibitions on pets or parties. However, other important rules are also found in leases. For example, many landlords prohibit tenants from redecorating their property, from changing locks, from using propane grills and from storing items on balconies. Read the lease carefully to ensure you can abide by each of the rules.

Number 3: When Will My Lease End, and What Happens When It Does?

Many leases define how long they will last (called the “term” of the lease) and under what circumstances they will renew. If the lease does not provide this information, state law will set the term of the lease and its renewal. In some states, the term of a lease is one year if the lease does not say otherwise. However, often, these leases automatically renew if no one cancels. Before you sign a residential lease, make sure you know how long you are locked into it and under what circumstances you can move out and owe no more rent. If you are not sure, consult with your Personal Family Lawyer(s).

While these are the most critical issues in residential leases, you should always read the lease completely to make sure you understand it. If you are not sure what it means, ask the landlord to explain it to you. You may also wish to discuss a potential lease with your family’s Personal Family Lawyer.

We are our clients’ lawyer for life. If you are ready for a lifetime relationship with a lawyer who can guide you and your family to create more family wealth, not just financial wealth, call to schedule a Family Wealth Planning Session.

How to Benefit from an Estate Plan When You Own Real Estate

victorian-style-1647594Many parents believe that by adding a child’s name to a property deed, they can pass along the property outside of probate. Unfortunately, those who act on that belief often find they have invited more problems than they have avoided.

This is because in many states, when more than one person owns property together and they are not married. The property that is owned is referred to as tenants in common.  This means that if one of the owners dies, his or her ownership share does not transfer to the other owner.  It goes to the deceased owner’s heirs through probate.

This problem can be avoided if the deed lists the property as designate property ownership with joint tenants that both have the right of survivorship or similar language signifying survivorship rights. Enlisting the help of an attorney with estate planning knowledge would be advisable to pass your property on outside probate.

However, there are some reasons why it may not be advisable for you to deed real estate to children, with adverse tax consequences topping the list.  This is because deeding property to children is actually considered a gift, and the cost basis for that gift is what you paid for your home.

Example:  say you paid $50,000 for your home and it is now worth $350,000.  You add your children to the deed, which the IRS deems a gift.  After you die, the children sell the home for the market value of $350,000.  They will be taxed on the difference between the cost basis of $50,000 and the sale price of $350,000 – or $300,000, minus the cost of the sale.  That’s a big tax burden for your children.

Another solution would be, if your children inherited the property via your will, then sell it using the same scenario above, they would owe no tax on the sale because their cost basis is what the property was worth when they inherited it (current market value of $350,000).

If the idea is to leave property to children while avoiding probate, you can do so by creating a simple trust and titling the property in the name of the trust, naming your children as trust beneficiaries.  You avoid the problems and costs that the property passes outside probate in a tax-advantaged way.

Call our office to schedule a time for us to sit down and talk about a Family Wealth Planning Session, where we can identify the best ways for you to ensure your legacy of love and financial security for your family.

How to Protect Your Real Estate Assets

If you own real estate, chances are you have purchased insurance to protect your assets against damage or loss.  But have you taken the necessary steps to protect your assets against lawsuits or probate?

If you own rental properties, there is likely a nagging fear in the back of your mind about being sued by one of your tenants.  And if there isn’t, there probably should be.  It’s a major risk.

And while it may be heartbreaking to think about, there is always a chance your death could trigger a family feud over your home, vacation home or other real estate investments.

Two common estate planning tools for real estate asset protection include limited liability companies (LLCs) and trusts:

LLC.  If you have income-producing property, then an LLC probably makes sense for you, since it protects your personal assets from lawsuits or claims that result from your ownership of the real estate.  LLCs may also offer owners privacy since the property can be listed in a company name, not in your name directly.  However, you must be sure you maintain the LLC properly so the planned for protections remain intact.  It’s not too difficult though, especially with counsel.

Trusts.  If you own vacation home property that you do not rent out on a regular basis, then a trust may be a better choice for you.  There are several options:  a Qualified Personal Residence Trust (QRPT) is an irrevocable trust (meaning it cannot be changed without the consent of the beneficiaries) that allows an owner to use the property for a fixed term, and then pass the property on to heirs.  This is a commonly used structure to reduce the size of your estate for estate tax purposes.

A revocable trust (which can be changed without consent of the beneficiaries) is more flexible and, if you choose a dynasty trust, can last for multiple generations.  The major benefit of the revocable trust, besides control of what happens to the assets after the death of the grantors, is that it keeps your assets out of the hands of the Court after your death, and totally within the control of your family.

You can also use a combination of LLCs and trusts to protect real estate assets if you have a combination of primary residence and rental properties.  We can help you decide on the best course of action for your individual circumstances.

One of the main goals of our law practice is to help families like yours plan for the safe, successful transfer of wealth to the next generation.  Call our office today to schedule a time for us to sit down and talk about a Family Wealth Planning Session, where we can identify the best strategies for you and your family to ensure your legacy of love and financial security.

 

7 Reasons to Consider a Trust for Your Family

Do you consider trusts to be instruments of the wealthy?  While it is true that many Americans of means have trusts to protect and pass their wealth, there are some reasons why trusts can also be useful for middle-class families.  Here are 7 of them:

  1. Control distribution of assets.

You would not hand over your car keys to a child who has had no proper preparation for driving, and chances are you would not want to hand over all your assets to a teenager either.  However, if both parents die at the same time, the children would inherit all the assets upon their 18th birthdays.  A trust allows you to specify how and when you want your children to inherit.

  1. Protect assets from creditors.

Placing an inheritance in a trust ensures that those assets are protected from your heir’s  — or their spouse’s – creditors. Consider a Lifetime Asset Protection or Wealth Creation Trust.

  1. Protect inheritance from spendthrift heirs.

Not everyone is good with money.  If your heirs fall into that category, you can use a trust to ensure the assets are not frittered away due to spend-thrift behavior.

  1. Protect inheritance for children of prior marriage.

You can use a trust to both provide for your current spouse and any children from a previous marriage.

  1. Provide for a special-needs heir.

Leaving assets outright to an heir with special needs could disqualify them from receiving important government benefits.  Leaving those assets in trust bypasses this potential risk.

  1. Avoid probate.

Assets can pass to heirs without going through probate by using a trust, saving beneficiaries the time and expense of the probate process. Probate is an expensive, public and unnecessary court process you can keep your family from having to deal with.

  1. Protect privacy.

Once a will is entered into probate, it becomes public; a trust is a private document that will protect your family’s privacy.

If you would like more information about protecting your loved ones, call our office today to schedule a time for us to sit down and talk.

Taking the Complexity Out of Estate Planning

Remember that old joke: How do you eat an elephant?  Answer: One bite at a time.  At the heart of that gag is the truth about how you tackle any seemingly complex task, taking it one step at a time so as not to overwhelm yourself.

Many people neglect to create an estate plan because they see it as the proverbial elephant…too big, too complex.  But if you approach estate planning in a systematic fashion, it takes the complexity right out of it – especially with the help of a knowledgeable Personal Family Lawyer®.

Here are some tips on how you can reduce the complexity in creating an estate plan, from a recent Fox Business article:

Add up your assets.  Take into account your retirement accounts, life insurance, potential inheritance, savings, property ownership, etc.

Consider trusts.  Trusts are simply vehicles for protecting your assets from creditors – yours or your heirs – and from potential future ex-spouses.  They are also a great mechanism for maintaining your privacy and allowing your assets to pass to your heirs without the expense and hassle of probate, which can tie up assets for a year or more.  And they also help you and your heirs avoid estate taxes.

Think about whom you trust to act as your agent(s).  You will need to appoint a person or persons to act as your agent through a power of attorney in case you are unable to make those decisions yourself, in the case you become incapacitated or have a terminal illness.  This applies for health care decisions as well as financial oversight.

Realize what a will can and cannot do for you.  A will is the cornerstone of your estate plan, giving you the legal power to pass along assets and property to heirs as well as name a guardian for minor children and appoint the people you need to carry out your wishes after you are gone – i.e., who will administer your estate and who will safeguard your assets for minor children.

If you would like to have a talk about estate planning, call our office today to schedule a time for us to sit down and talk.

How to Reduce the Risk of Identity Theft When a Loved One Dies

A new trend in identity theft – afterlife identity theft – is on the rise, with thieves scouring obituaries for personal information to steal the identities of those who have passed.  When you lose a loved one, it is important to take quick action and notify a number of institutions and government agencies about the death to help prevent afterlife identity theft.

The National Funeral Directors Association provides a list of government and credit reporting agencies, creditors and banks for notification, including:

  • Social Security Administration
  • Veteran’s Administration (if the decedent formerly served in the military)
  • Defense Finance and Accounting Service (military service retiree receiving benefits)
  • Office of Personnel Management (if the decedent is a former federal civil service employee)
  • S. Citizen and Immigration Service (If the decedent was not a U.S. citizen)
  • State Department of Motor Vehicles (If the decedent had a driver’s license)
  • Credit card and merchant card companies
  • Banks, savings and loan associations and credit unions
  • Mortgage companies and lenders
  • Financial planners and stock brokers
  • Pension providers
  • Life insurers and annuity companies
  • Health, medical and dental insurers
  • Disability insurers
  • Automotive insurer
  • Mutual benefit companies
  • All three credit reporting agencies: Experian, Equifax, and TransUnion
  • Any memberships held by the decedent (ex: health clubs, professional associations, clubs, library etc.)

The NFDA recommends that you notify these entities first by phone followed by a written confirmation, where you will need to provide a certified copy of the death certificate, the decedent’s Social Security number and, if you are the executor or administrator of an estate, the verification of your appointment by a probate court.  Be sure to ask the funeral home you are using if they can provide notification services for you, as many do.

If you would like to have a talk about protecting your loved ones through estate planning, call our office today to schedule a time for us to sit down and talk.