Lessons from the Front Lines: Specialization Matters. 3 Things You Need to Know

When it comes to your family, your money, your property and your life specialization really does matter. Here are three things you must know to protect yourself, family and property.

1. Estate Planning Should be Left to the Specialists.

The field of estate planning is deceptive. It seems simple to those unfamiliar with its intricacies. Many non-specialists believe they can just copy a form or fill one in and then sell it to you as an estate plan. Others take a DIY approach and believe the internet can be their source of estate planning documents.

Nothing could be further from the truth. Here are examples of actual cases where clients lost significant property and money by not using a specialist.

A. Man does his own trust, names children from a prior marriage as trustee for a child from a later marriage. Result: court case and thousands of dollars in legal fees. In this case, an estate planning specialist would have not drafted this trustee provision or created a safety valve to eliminate the problem.

B. Woman hand writes her own will in writing that no one can read. Result: a court has to decide the terms of the handwritten will and after long court battle the entire will is thrown out by the judge. Again, an estate planning specialist would have saved the family thousands of dollars.

C. Man owns farm property with his sister in a corporation. Man dies with a will created by his attorney friend who is not a specialist. This simple form (which should never had been used) meant his surviving spouse inherits his share of the farm corporation even though  surviving sister thought she would own the farm. Result: surviving wife wins after protracted court battle.

There are many other examples of this same principle. Either pay at the beginning to do things right or pay us later to go to court and solve the problems created by the DIY solution.

2. Check and Recheck Beneficiary Designations.

Even a properly designed and drafted estate plan can be derailed by not reviewing and revising old beneficiary designations. Here is an example:

Woman creates a trust to protect her husband and children. She fails to change a prior beneficiary designation that left a Fidelity account to her children outright. Result: Her trust fails since NONE of the Fidelity account will pass to her trust.

An estate planning specialist would have advised this woman to revise the beneficiary designation on this account so her trust would have received the account proceeds.

3. Be Cautious of Family Member Trustees.

In example A above naming a family member trustee was a disaster. Whenever a client considers a family member trustee it is necessary to pressure test that provision under a variety of possible scenarios. Here are the issues family members can create:

A. Not knowing what their job is.

Most family member PR's and trustees do not understand their fiduciary duties and responsibilities. This can lead to numerous inadvertent violations.

B. Failing to act where action is required.

Often a family member is reluctant to act as a fiduciary out of ignorance or fear. Failing to act when action is required is as much a violation as taking the wrong action.

C. Family members are difficult to sue.

When a PR or trustee messes up sometimes a court can make them answer for their conduct. However beneficiaries are often reluctant to sue a family member costing themselves benefits they are rightfully entitled to.

The lesson here is to exercise caution before naming a family member as PR or trustee.

Here are the three lessons from the front lines that can help you protect yourself and your family:

1. Leave estate planning to the experts.

2. Check and recheck your beneficiary designations.

3. Exercise caution in naming a family member as a PR or trustee.

Estate Planning Awareness Week 2018

Each year we celebrate National Estate Planning Awareness Week to help spread attention and aware ness of the importance of estate planning.

Do you have all your ducks in a row?

Estate planning is not about how much money or property you have. It is actually about how much you care for your family. Doing a proper estate plan is a reflection of the legacy you leave, how you will be remembered and whether you helped your family achieve success, not monetarily but in life.

Help celebrate National Estate Planning Awareness Week by making sure your ducks are in a row and encourage your family and friends to do the same.

Bernie Greenberg
kgattys.com

Trusts Equal Protection

As an estate planning attorney I am asked every day about trusts. Why should I use a trust? What is a trust? What do trusts do? Are trusts about trust?

All these questions are interesting as are the answers. However neither the question nor answer get to the essence of why we use trusts and their ultimate purpose--protection.

Trusts are used to protect someone or something (property) from someone or something (taxes). As examples think about protecting these folks:

1. Your spouse.
2. Your kids.
3. An elderly loved one.
4. Someone at risk.
5. Someone with a disability.

Things we might protect against include:

1. Poor money management.
2. Creditors.
3. Predators.
4. Taxes.
5. Addictive behavior or drug addiction.

So when you ask a question about whether a trust might fit into your planning ask if there is someone you want to protect, something you want to protect and what risks you want to protect against.

Bernie Greenberg

3 Steps to Protect Yourself from Tax Scams

Today is that day, tax day when, if you haven't already, it's time to get your taxes or extension files and taxes paid. Tax day always brings some stress, some angst and the scammers. Con artists constantly look for new ways into your wallet and accounts. Your job is to be ever vigilent and protect yourself.

1. The IRS does not call on the phone or email ANYONE!

This is an old trick used by con artists--imitating people you are already afraid of--like the taxman. Be aware that the IRS does not call, text or email. Also, if you take a call, all IRS personnel must identify themselves by name and identification number. Scammers will not.

2. The IRS and states do not contact you via social media or text.

As tempting as it might be to respond bear in mind that you are receiving a message from a con artist and not from the IRS. Your best course of action is to use your delete key.

3. Do not post your financial information online or on ANY social media site.

Does this require explanation? No. Just don't do it. Ever.

The only person who can prevent a con artist from scamming you is you. Always apply these 3 simple steps as your first line of defense. For further information refer to articles and FAQ sections of the IRS, State of Colorado and Colorado Attorney General's websites.

Don't Let Hackers and Predators Prepare Your Will: 3 Steps to Protect Yourself and Your Family

Social media and internet have many benefits. They also are traps for the unwary and unprepared. Don't let hackers and predators on the internet get your personal, financial and family information and data.

In my world of estate planning this is critical. If you are considering doing your will and estate plan the last place to look for advice is social media. You could subject yourself to foreign hackers and predators who fish for unsuspecting people 24/7 on social media sites like facebook. We hear everyday how foreign agents are using facebook to influence your every day decisions.

Here are the ways you can protect yourself, your family and your property:

1. Never reveal personal information online to anyone, anytime.

Trusted websites like your bank, brokerage firm etc. are acceptable places to use their secure tools for doing this. Never reveal your personal information on any social media site. Ever.

Also to be avoided are chat sites for your personal information. These sites are not secure and frequently mined by hackers to steal your information.

2. Don't post pictures of your property, home, young children, cars or accounts on any social media site.

If you are inclined to post the pictures of your trip or vacation do so after you have returned to avoid providing the robbers the information about when they can go to your home and steal your stuff.

3. Do not rely on legal, accounting or tax advice you receive online or social media.

You would never ask how to do surgery on your knee or ankle on facebook and you should act the same about your property and money. Use social media to get referrals to competent specialists and professionals and go meet with them in person.

Doing your will and estate plan requires the assistance of qualified specialists just like an operation or surgery. Protect yourself and family by avoiding providing the means to hackers and predators to steal from you. Remember: You are the first and best means of protecting yourself and family.

How the New Tax Law Impacts You!

Hopefully you have heard that we have a new tax law. This new law is called: The Tax Cuts and Jobs Act of 2018. It is a major redo of the tax code and extends the impacts of the 2010 tax re-write into your estate planning.

Here is what you need to know now:

1. Run don't walk to your estate planning attorney's office to amend your plan if you have an old style A-B trust or marital trust plan. If you don't know, then find out immediately. The doubling of the estate, gift and generation skipping tax exemptions are the reason this is so critical.

Just like in 2010 and after, if you die with an old plan with these old formula provisions you will wreak financial havoc on your family and create results you never expected and your family will hate you for forever.

2. While you are in your estate planning attorney's office make sure your beneficiary designations and titling are properly coordinated with your revised estate plan.

3. Next schedule a meeting with your accountant and income tax advisor and learn just how much the new tax law changes your income tax situation. Again, you will be surprised just how significant the changes might be to you and your family.

No matter how you feel about politicians, their involvement in your money and estate plan can be minimized or eliminated. Make sure you discuss how you can do that with your estate planning attorney.

Don't delay, make sure you take these actions immediately or sooner.