Attorney Joseph H. Helm, Jr., McLario, Helm & Bertling, SC, Menomonee Falls, was the featured speaker at Community Memorial Hospital's recent Senior Breakfast. Here is an overview of Atty. Helm's presentation, featuring simple strategies for making the most of your assets and securing the future for you and your family.
When it comes to estate planning, many people aren't sure where to begin. Or they may develop a plan, file it away and forget about it. These can be costly mistakes. Having an effective plan, and keeping it up-to-date, can be the best investment you'll ever make. If your will or estate plan is more than ten years old, it's vital that you update it to reflect current law. A sound estate plan should include several essential elements: Powers of Attorney, wills, trusts, PODs and TODs, charitable giving, and consulting with experts.
Should you become incapacitated and unable to make decisions for yourself, your family may have to go through an expensive and time-consuming court action to appoint a guardian to act on your behalf. A general durable power of attorney is a legal document that allows you to choose the person you trust to handle your affairs if you cannot do so yourself. The document can designate the types of decisions you wish to give to the designated representative, typically financial and legal. It is advisable to consult an attorney to make sure your financial power of attorney document is customized to meet your particular needs and circumstances.
A durable power of attorney for health care designates who you wish to make decisions about healthcare issues if you become incapacitated, and records your wishes regarding the provision of medical treatment in certain health care situations (often referred to as "living will" provisions). It is possible to complete the healthcare power of attorney document yourself, and if properly completed and signed, it will be legally binding. (A healthcare power of attorney form is available by calling Community Memorial Hospital CareConnection: 1-800-246-8332). This document should be kept on file with family members and health care providers.
Both types of power of attorney documents remain in effect during a person's lifetime. At the time of death, power of attorney documents are no longer active. At death, the individual's will and/or trust goes into effect.
A well-planned will is the cornerstone of many estate plans, yet more than half of all Americans die without a will, leaving their assets to be distributed in ways they never intended. A will determines how and to whom you wish your property to be distributed, whether you have minimal assets or a significant estate. A properly-drafted will can also help avoid unnecessary taxes. The ultimate goal is to make sure that all you have accumulated over a lifetime is transferred to loved ones and cherished causes in the way that you choose.
Even if you have a will, in most cases your estate will still need to enter probate, a court procedure to supervise the distribution of assets. This can be a lengthy and costly process. Depending on the size of your estate, court costs, legal fees, and taxes may take a significant bite before assets are even distributed.
Because of these and other considerations, many people choose a trust document as their primary estate planning document. A trust allows you to place your assets, including your house, money, stocks, and other property, into a legal status that avoids probate, while retaining all ownership and control for your entire lifetime. While you are alive, you are the sole owner, trustee (manager) and beneficiary of the trust. When you die, the beneficiaries you have named assume ownership, avoiding probate and most, if not all, of the associated costs. There are numerous ways to set up a trust. Trusts can be arranged to provide for your children's enjoyment of the assets, while making sure that grandchildren are the ultimate beneficiaries in order to keep the inheritance in the family. Trusts can also be set up to protect your children's inheritance by preventing half from going to a child's ex-spouse in the case of divorce. These are just some of the ways a trust document can favorably direct your estate.
Naming a spouse, child or other beneficiary as a "payable-on-death" designee (typically POD for bank accounts) or "transfer-on-death" (TOD for mutual funds or brokerage accounts) can be a simple, convenient way to pass a defined asset on to a beneficiary of your choosing, avoiding probate and estate taxes. Likewise, naming a charitable organization as beneficiary on a bank or investment account is a simple way to not only avoid probate, but to support causes meaningful to you.
People often overlook charitable giving as an important component of estate planning. Including your favorite charities in your plan can significantly reduce the portion of your property that would otherwise go to the government, while making only a small difference in the amount your family receives. Because the gift is deferred until after your death, it won't affect your or your family's financial security during your lifetime. Your attorney or tax advisor can identify the most useful strategies to maximize income and minimize tax liability based on your own situation.
Beware of generic, "one-size-fits-all" documents. This is one area where consulting a professional is well worth the modest investment, and can save many times over the initial cost. An attorney or financial advisor knowledgeable about current tax and estate law can make sure your plan is customized to fit your unique situation, and allow you to take full advantage of legal and tax arrangements that can save you and your family time, stress and money.
If you are looking for an easy way to make a lasting difference, consider making a deferred or planned gift. Simply adding a bequest to Community Memorial Foundation in your will is the easiest and simplest way to do this. It doesn't affect your assets during your lifetime, and because of the tax savings, the impact on your children's inheritance can be minimal.
A gift of any size qualifies, and you can choose how you want your gift to be used, whether for Women's Health, Cancer Care, the Community Outreach Health Clinic for the uninsured, or another Community Memorial program. You can leave a specific amount, or a percentage of the assets left after other distributions are made. Or create a permanent endowment to honor the memory of your family or a loved one. Your gift will make you a member of our Evergreen Society, along with other generous individuals who have remembered the Foundation in their wills. And you'll have the satisfaction of knowing that because of you, Community Memorial Hospital will be here to meet changing health care needs well into the future, enriching lives for generations to come.
To find out more about charitable and planned giving, call Community Memorial Foundation 262-257-3769.
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