Category Archives: Estate Planning Blog

Gift Giving the Tax-Free Way

gift giving 91024Although it’s the season of giving, no one wants to share with the IRS. Luckily, the law provides you many opportunities to give gifts to family, friends, and charities tax-free.  Some are straightforward, while others may require the help of a professional.

Your Yearly Coupons

Each year on January 1st, everyone receives what can be thought of as yearly coupons for tax-free gifts. There are several different ways you can redeem these coupons:

  • Annual exclusion gifts. These gifts are transfers of money or property that do not exceed the annual gift tax exclusion. These gifts can be given on one or more than one occasion throughout the year, the key is that you add up the gifts throughout the year. In 2017, you can give up to $14,000 ($28,000 for married couples) per recipient without owing any gift tax or filing a gift tax return. These gifts can be cash or property but they must be of a “present” interest. Without giving a “present” interest – for example, if you plan on using a trust or an LLC to make your gift, it’s best to work with a professional.
  • Pay medical bills. The IRS also allows you to pay an unlimited amount of someone’s medical bills, without worrying about the gift tax. However, the payment must be made directly to the doctor, hospital, or other medical provider in order to qualify.
  • Pay tuition. Additionally, you are able to pay an unlimited amount of tuition bills for the benefit of someone else, as long as the tuition is paid directly to a qualified educational institution. One big issue here is that the gift must be only for tuition – books, fees, living expenses, travel, and other costs of education do not qualify.
  • Give to charity. For those of you who are philanthropically minded, you can give as much money or property to a qualified charity as you want without worrying about the gift tax. As an added benefit, unlike the gifts above, you may also be entitled to an income tax deduction for the charitable gift.

Your Once-In-A-Lifetime Coupon

In addition to our annual coupons, we all have a once-in-a-lifetime coupon for taxable gifts, those that exceed or do not qualify for the annual exclusion, called the unified credit.  It’s called a unified credit because it unifies the gift tax with the estate tax into a coordinated tax system.  Unlike the annual coupons you read about above, once you spend the value of the unified credit coupon for a taxable gift, it’s gone.

Many people assume that because it says taxable gifts, they’ll have to pay the gift tax. Luckily because of the unified credit coupon, most people will never have to actually pay any gift tax. You only have to pay gift tax if your lifetime gifts exceed the unified credit coupon.  Under current law, the amount of the unified credit increases each year, but it never resets (unlike the yearly coupons you read about earlier).  In 2017, the unified credit amount is $5.49 million and is scheduled to increase to $5.6 million in 2018.  However, If you make a taxable gift, you are required to file a gift tax return with your income taxes.  Although the unified credit is currently applicable for gift and estate tax, it is worth noting that the gift tax continues on in the tax proposals being considered by Congress, even as an estate tax repeal is on the agenda.

When should I talk to an estate planner?

If you plan on making a gift in excess of $14,000 in 2017 ($15,000 in 2018), then you should talk with a trusted professional first. Sometimes the best way of making a gift is to just write a check, but other times giving in a trust, through an LLC, or with an undivided interest in property can make more sense and offer your recipient greater benefits (like privacy or asset protection).

While we don’t suggest you give away anything that you might need, if you do have some surplus, gifting programs are a fun way to see your loved ones enjoy your generosity – as long as you do it without drawing the attention of the IRS!

Dedicated to empowering your family, building your wealth and creating your legacy,

Marc Garlett 91024

Four Good Reasons Why Estate Planning Isn’t Just for the Rich

Estate Planning 91024There is a common misconception that estate plans are only for the ultra-wealthy – the top 1 percent, 10%, or some other arbitrary determination of “enough” money.  In reality, nothing could be further from the truth. People at all income and wealth levels can benefit from a comprehensive estate plan. Yet sadly, many will never sit down to get their legal house in order.

According to a 2016 Gallup News Poll more than half of all Americans do not even have a will, let alone a comprehensive estate plan. Gallup noted that 44 percent of people surveyed in 2016 had a will place, compared to 51 percent in 2005 and 48 percent in 1990.  Also, over the years, there appears to be a trend of fewer people even thinking about estate planning.

When it comes to estate planning, the sooner you start the better. Below are four reasons why everyone – no matter what income or wealth level – can benefit from a comprehensive estate plan:

  1. Forward Thinking Family Goals: Proper estate planning can accomplish many things. The first step is to ask what your goals are. They may include caring for a minor child, an elderly parent, a disabled relative, or distributing real and personal property to individuals who will appreciate and maintain these assets prudently.  Understanding your family wants and needs is a great starting point for any estate plan. If you can sit down and spend time planning your vacation, you should do the same for your estate. Your future self, and your loved ones, will thank you.
  2. Financial Confidence Now and After You Are Gone: One immediate benefit of having a finished estate plan in place is that you will be in total control of your finances, possibly for the first time ever. Many people experience a new sense of discipline in maintaining their finances which can help with saving for retirement, a big purchase, or other goal.  In addition to the personal benefit of financial control, an estate plan allows you to dictate exactly how and when your heirs receive an inheritance. This is particularly important for minor heirs or those who need additional guidance to manage an inheritance, like a disabled child.
  3. Identify Risks: An important aspect of a good estate plan is to mitigate against future and current risks. One example is becoming disabled and unable to support your family. Another is the possibility of dying early. Through an estate plan you can chose who will be in control of your personal assets, instead of the court appointing a legal guardian – costing money and becoming a distraction for your family.  While contemplating these types of risks is never fun, preparing ahead of time ensures your loved ones will be prepared if an unfortunate tragedy does occur.
  4. To Maintain Your Privacy: In the absence of a fully funded, trust-based estate plan, a list of one’s assets are available for public view upon death. This occurs during probate, the legal process by which a court administers the deceased person’s estate. A solid estate plan will generally avoid the need for involvement by the probate court, so your family’s privacy can be maintained.

The Bottom Line: Seek Professional Advice

There are numerous benefits to working with a professional team when it comes to estate planning. Estate planning attorneys, financial advisors, insurance agents, and others have a broad and deep knowledge of money management, financial implications, and the law. When you work with a qualified team to implement an estate plan you can rest easy knowing your family will be taken care of no matter what happens in the future.

Dedicated to empowering your family, building your wealth and securing your legacy,

Marc Garlett 91024

 

How to Share Family History and Heirlooms Through Your Estate Plan

legacy 91024One of the most important aspects of your estate plan is – or at least should be – protecting and passing on your legacy. And this coming holiday season is a great opportunity to reminisce about your family’s stories, values, and history because you’ll probably have your loved ones nearby.

While having those conversations is important, did you know you can also use a personal property memorandum in your estate plan to pass along special memories and stories about specific items that are meaningful to you and connect your family with the past?

What Is a Personal Property Memorandum?

California state law allows you to include a “personal property memorandum” in your estate plan. This supplemental document, specifically referenced in your will or living trust, lets you describe which personal property items you wish to leave to heirs, without having to call your lawyer and arrange for a meeting. You can handwrite or type this document, but it must be signed and dated to be valid. In conjunction with a will or living trust, a personal property memorandum can provide a roadmap for your executor regarding the distribution of specified items to your beneficiaries.

One important feature of a personal property memorandum is that you can change or update it whenever you like without the assistance of an attorney or notary. This freedom can be beneficial to you, because although you can also change your will as often as you like (and you absolutely should update it periodically to make sure it still reflects your wishes!), updating your will or living trust does require a visit to the estate planner’s office.

Another great reason to have a personal property memorandum in addition to your will and living trust is that your personal possessions likely change more frequently than other assets. For example, you probably add items to your closet more often than you add vehicles to your driveway.

What Can Be Included in a Personal Property Memorandum?

Not every asset can be distributed using a personal property memorandum! However, here are a few examples of assets that we commonly see people list in their personal property memorandum:

  • Furniture
  • Jewelry
  • Clothes
  • Books
  • Photographs and portraits
  • Important certificates (birth, marriage, death, citizenship/naturalization)
  • Collections (coins, stamps, dolls, figurines, etc.)
  • Other family heirlooms

Taking Your Personal Property Memorandum to the Next Level

We include a personal property memorandum as part of each client’s trust plan, but more importantly, I always suggest being a little creative with the process. Instead of just using the legal documents to pass on valuable heirlooms, I encourage each client to take a picture of every item of importance and write two paragraphs on the back of each picture.

The first paragraph is the story of why that item is meaningful. How, why, and when was it acquired? What is the item’s history? Why is the item so important to you? The second paragraph is the story of why you chose that particular person to receive the item. Why is continuing that item’s story on through them so important to you?

The picture makes it clear which items you’re talking about so there’s no confusion. The two paragraphs transform the gift from the realm estate planning documents and legalese into that of heart and soul, making the gift that much more meaningful to the recipient, and continuing the story of the item for future generations just as you ensure the story of your connection to the item lives on.

Giving It Away Now Versus Waiting Until Later

One option you always have is to give personal items to your loved ones while you’re still alive. You can share with them the accompanying stories as you’re making the gift. Indeed, this in-person exchange is often the surest way to know your wishes will be followed. If you do choose to give away possessions during your lifetime, you must be aware of any potential gift tax consequences that could arise for items of a larger value. But, generally any gift or series of gifts, within the calendar year, valued at less than $14,000 (up to $15,000 starting in 2018) can be given without concern.

Remember, verbal wishes alone are insufficient to gift personal property after you’ve passed away. So whether you decide to hand down your prized possessions now or later, know that one of the best gifts you can give your loved ones is the story behind a personal possession that connects it with you and your family forever. A good estate plan not only protects your family financially, it also protects and passes on the stories and heirlooms of your life’s legacy.

Dedicated to empowering your family, building your wealth and securing your legacy,

Marc Garlett 91024

Can You Bequeath Your Frequent Flyer Miles?

frequent flyer miles 91024If you’re a frequent airline traveler, one of your estate planning concerns may be what will happen to your accumulated miles once you’re gone. They could be worth thousands of dollars, so you probably don’t want them to just disappear, but some airline policies say that’s exactly what will happen.

The law doesn’t consider airline miles assets that can be bequeathed directly to heirs, but there are still some steps you can take to help ensure your miles live on. It all starts with examining the airline policies in question.

Airline Policies Regarding the Transfer of Frequent Flyer Miles

Some relevant policies include:

  • American Airlines AAdvantage: “Neither accrued mileage, nor award tickets, nor status, nor upgrades are transferable by the member (i) upon death . . . . However, American Airlines, in its sole discretion, may credit accrued mileage to persons specifically identified in court approved divorce decrees and wills upon receipt of documentation satisfactory to American Airlines and upon payment of any applicable fees.”
  • Delta Airlines SkyMiles: “Except as specifically authorized in the Membership Guide and Program Rules or otherwise in writing by an officer of Delta, miles may not be . . . transferred under any circumstances, including . . . upon death. . . . ”
  • Southwest Airlines Rapid Rewards: “Points may not be transferred to a Member’s estate or as part of a settlement, inheritance, or will. In the event of a Member’s death, his/her account will become inactive after 24 months from the last earning date (unless the account is requested to be closed) and points will be unavailable for use.”
  • United Airlines MileagePlus: “In the event of the death or divorce of a Member, United may, in its sole discretion, credit all or a portion of such Member’s accrued mileage to authorized persons upon receipt of documentation satisfactory to United and payment of applicable fees.”

As you can see, policy terms vary, and they may vary even further depending on your agent. Airfarewatchdog.com has found differences between written policies and what customer service representatives told them over the phone.

How to Transfer Miles After Death

The main takeaway is that although airline policies may say they don’t allow miles transfers after death, employees often have the discretion to approve them. Still, there’s no sure way to know whether your airline will work with your loved ones regarding the transfer of your miles.

One way to better ensure your miles get transferred is to include a provision in your will that makes your wishes clear. This step is especially important if your airline requires a copy of a will as documentation, but it can be helpful in any event.

Another option is to leave your account number, login and password to the person you would like to be able to use your miles. Some airlines permit such transfers and usage of miles after the account holder’s death.

In either scenario, you should talk to your loved ones about your intentions so they know to pursue the issue in your absence. Also, if you’re the one trying to claim miles of a deceased person, you should understand the airline’s policies before offering information about the account holder’s death, as the account could be canceled immediately, leaving you with no recourse.

Final Thought on Frequent Flyer Miles

Frequent flyer policies can change at the whim of the airlines even as you are living, so another idea to keep in mind is to use the miles now and create experiences with your loved ones rather than plan to pass the miles on later. In doing so, you can be absolutely sure your miles aren’t lost; an added bonus is that you can also share moments none of you will ever forget.

Dedicated to building your wealth, empowering your family and securing your legacy,

Marc Garlett 91024

IRAs, Annuities and Guardianship: Providing for Your Minor Children if You Die Before They Reach Adulthood

young-family 91024Deciding on a guardian for your minor children may very well be the most important decision you’ll make regarding your estate planning. Not only must you trust the appointed guardian to raise your children as you’d want them raised, but you also need that person to be financially responsible with your children’s inheritance. For example, if you have an IRA or an annuity that you wish to pass to your minor children, how can you ensure those funds will be used properly—especially if the person you trust most to raise your kids isn’t necessarily the best with finances?

This question is multifaceted, so let’s unravel one aspect at a time.

The Question of Guardianship

Here’s the good news: The person who raises your minor children and the person who handles their inheritance don’t have to be the same person. If necessary, you can appoint one guardian to serve each function, naming one as the guardian of the person and another as the guardian of the estate. In this arrangement, you entrust one person with your children’s assets and another with their care, while enabling each to interact with the other. This dual guardianship model gives many parents peace of mind—knowing they don’t necessarily have to risk their children’s inheritance while ensuring that they are raised according to the family’s values.

Although guardianship of the estate is an option, for many families the best strategy for financially providing for the children is to use a trust. In that case, a trustee fulfills the responsibility that would otherwise belong to the guardian of the estate. The trust assets can be released to the children or the caregiver incrementally according to age and needs. For example, the trustee could distribute money for the children’s needs until age 18 and then manage for the money until the child is a financially mature adult. Your trustee may also exercise discretion in investing and distributing the funds for the children’s support, education, etc., coordinating with their physical guardian to ensure the children’s needs are met until they come of age. This can ensure that the assets are there when they’re needed for your family.

Passing an Annuity to the Children

Annuities pay out regular income—which can make them convenient vehicles to cover ongoing expenses for minor children. If you have set up an annuity for yourself or a spouse, you can name the children as beneficiaries, or you can also name a trust for the benefit of your children. If you are still paying into the annuity at the time of death, your children may receive the balance, or you may give a trustee the option of rolling the balance into another annuity to be paid out to the children at a later maturity date. If you are already receiving annuity payments yourself, the children may simply continue receiving these payments for the remainder of the term. Depending on your annuity contract, payouts may also be made lump sum. Annuities are a very flexible financial product with many different options. If you have annuity now, or if you are considering purchasing one, bring it up with us as we work on your estate plan so we can make sure it meshes with your will or trust seamlessly.

Transferring an IRA to the Children

Individual Retirement Accounts (IRAs) are also excellent vehicles to pass along wealth for minor children’s welfare—because, unlike most annuities, they have the ability to grow over time and can provide a lifetime of financial benefit to your children.

When you name the next generation as beneficiaries on an IRA, you effectively extend the IRA’s life expectancy. While the required minimum distribution payments to the children will be smaller than they would have been for you (since, according to the IRS’s rules, they have a longer life expectancy), the account balance can remain invested for growth over time. Your financial and tax advisor can evaluate your situation to help you decide which type of IRA (Roth or traditional) is the best option for your goals. And we can work with you to set up a trust which fully protects your IRA against your child’s creditors, predators, future ex-spouses, and immature financial decision making.

Planning for the welfare of minor children after your death is neither simple nor pleasant to consider, but it’s absolutely necessary for peace of mind. Determining the right person(s) to be the guardian of your children requires careful thought, but you don’t have to sacrifice your children’s inheritance for their proper care. With the right financial plan, you can manage both facets successfully. As always, we’re here to provide assistance and explain your options. Call our offices for an appointment today.

Dedicated to building your wealth, empowering your family and securing your legacy,

Marc Garlett 91024

New Baby? Time to Create Your Estate Plan

newborn baby 91024Estate planning is often one item that gets pushed back on nearly everyone’s to-do list. The reasons you might be delaying vary: lack of time, not thinking you have enough assets, not knowing how to start, or the uncomfortableness of contemplating death. Whatever the reason for not putting an estate plan together, it is important to understand that if you just had a baby – there is no better time to meet with an estate planning attorney to implement a plan.

In general terms, an estate plan is a set of legal documents that outline your wishes on how your assets should be distributed and who is responsible for your dependents, in the event of your death or legal incapacity. An estate plan should be developed with a qualified estate planning attorney to ensure that it will work as intended and fully protect your family.  Here’s how an estate plan can you protect the newest addition to your family.

Protect Your Children

Perhaps to top reason to put together an estate plan is to dictate who will care for your children in the event you and your spouse die early or become legally incapacitated and therefore unable to care for your kids yourselves. Your estate plan can designate someone you trust and who shares your values as a guardian of your minor children – this is the person who will essentially be a surrogate parent and raise the children through adulthood. When selecting a guardian, it is important to choose people who will be willing participants in your estate plan, who share your values and parenting philosophy, and who you trust to raise your children.

Distribute Your “Stuff”

While some assets have purely financial value, others have deep emotional attachments. Not only will a trust-based estate plan eliminate the probate process, but it will save your heirs stress, time, and money. As you may already know, probate is the court-supervised process of wrapping up a deceased person’s affairs. This consists of multiple steps, including presenting a deceased’s last will and testament (if they had one – otherwise the probate court uses the government’s default plan known as intestacy), gathering assets, paying off debts, and distributing what’s left over to the deceased’s heirs. Using a trust to provide specific instructions on distribution of assets not only avoids probate altogether but it can help ward off fights among surviving relatives, too. Additionally, special features in your trust, sometimes called lifetime asset protection trusts, also allow you provide long-term financial stability and support for your children. These types of trusts can prevent a financially immature heir from blowing their inheritance.

Provide for Your Loved Ones

Beyond your children, creating an estate plan will inform your loved ones what final health care decisions should be made on your behalf in the event you become incapacitated and are unable to make decisions. Serving as healthcare proxy is an enormous responsibility for the person you name, but you can help lessen the burden by communicating your wishes about medical decisions. One significant advantage of properly planning is that your intentions can be clearly stated so that your surviving family members do not have to guess what your desires are.

Find an Estate Planning Attorney

If you have experienced a recent life-event – such as a new baby, a work promotion, purchasing a home, moving to a new state, or any other milestone – you should discuss your situation with a trusted estate planning lawyer. If you already have a will or trust in place, those life events make it necessary to update it to ensure it fully provides for your family and loved ones. To learn how estate planning can protect you, your newborn, and the rest of your family, contact us today.

Dedicated to building your wealth, empowering your family and securing your legacy,

Marc Garlett 91024

Planning for the Future (Without a Crystal Ball)

crystalball 91024Creating a will, trust, or any type of estate plan has always involved dealing with an uncertain future. Consider that just 20 years ago in 1997, the estate tax had an astonishing 55% rate with only a $600,000 exemption. Because of the low exemption and high rate back then, tax-driven estate planning was a mathematical necessity for a large segment of the population.

Fast forward to 2017. Not only do we now have a generous $5.49 million exemption and a lower 40% rate, we also have renewed emphasis and action from the President and Congress on repealing the estate tax, as evidenced by the September 27, 2017 Unified Framework for Fixing Our Broken Tax Code. So what does this mean for you, as you’re planning for the future?

Estate Tax Repeal Means No Need to Plan…Right?
Nothing could be further from the truth! Although there was a lot of tax-driven planning in the past, in recent years estate planning has largely focused on preserving family unity, protecting assets, ensuring privacy, and effectively passing along financial and emotional legacies.

And, for those with high net worth, it’s also worth mentioning that estate tax repeal isn’t a foregone conclusion at this point either. The Unified Framework still must be crafted into legislation that and pass both houses of Congress before being signed by the President. Given the political division the country faces (and the likely stiff opposition to the President’s tax proposal from Congressional Democrats), this will be no small feat.

Today, the focus of estate planning has shifted away from death taxes to other concerns that affect most families. Good estate planners now work with clients to protect their families against costly, public probate, guardianship, or conservatorship court proceedings and also further their legacy goals.

You might be worried about some of these things happening to your family:

● A financially irresponsible child or grandchild wasting their inheritance simply because they lack the financial maturity to handle wealth.
● A divorcing spouse of one of your heirs taking advantage of family wealth.
● Family discord lurking under the surface that tears your family apart, especially after the death of the patriarch or matriarch.
● A lawsuit, judgment, or bankruptcy that causes your family to lose their inheritance.
● Alzheimer’s or another cognitive impairment affecting you or someone else in your family.

Luckily, we have well-developed, flexible legal strategies (such as lifetime asset protection trusts, standby special needs trusts, and robust incapacity planning, to name a few) for overcoming these issues. Although estate planning can’t necessarily repair a damaged family relationship, proper planning can help make sure it does not get any worse. But these strategies only work when you implement or refresh your will, trust, and estate plan.

So, there’s no crystal ball. Where should I go from here?
According to WealthCounsel’s 2016 Estate Planning Literacy Survey, about 74% of Americans find estate planning to be a confusing topic. So, you’re not alone if you’re unsure about your next steps.

If you don’t yet have a will or trust, now is the time to explore getting one. If you have an “old” will or trust, now is the time to talk with us about whether you need an update. Modern families need modern estate planning solutions, and we are ready to help you create a flexible estate plan that works now, and will work in the future, even if the current tax laws change (even though no one has the proverbial crystal ball).

Dedicated to building your wealth, empowering your family and securing your legacy,

Marc Garlett 91024

Just a Few Of the Ways a Living Trust Helps Your Family

trust 91024There are several components to an estate plan, one of them being a living trust. Common benefits that prompt someone to create a living trust include increased privacy, reduced taxes, probate avoidance, and caring for family members with special needs. A living trust also lets you dictate how and when your assets will pass on to future generations after your death.

Avoiding Probate and Increasing Privacy

One of the primary reasons for creating an estate plan is to avoid probate. Unlike a will, a properly funded living trust will avoid probate, the lengthy and costly court-supervised process of transferring assets after death. Probate includes locating and determining the value of the deceased’s assets, paying off any outstanding bills and taxes, and then distributing the remaining value of the estate to the deceased’s rightful beneficiaries or heirs. Avoiding probate is often a top reason for estate planning, and there is no surprise as to why. First, probate can be a costly way to transfer your assets upon death. Second, it is very time-consuming for your family. It can take a year (or even longer) to complete the probate process. Complications, such as a contested will or an inability to find clear records of all of the deceased’s assets and debts, can extend this timeline. Finally, probate proceedings are a matter of public record so when your estate goes through this process, there is no privacy.

Reducing Taxes

While a living trust can help you avoid probate, it can also provide you with tax savings, especially if your estate is subject to death taxes (also known as estate and gift taxes). Of course, there are many types of trusts. One way to think about the variety is to consider a toolbox. For example, there are numerous kinds of screwdrivers, hammers, power tools, and so on. Each tool has an intended use. Trusts are no different. When you work with a family trust attorney, you ensure the type of trust is aligned with the tax-saving needs and other goals of your family.

Seeking Professional Help

It is important to understand that a trust only controls assets that are funded to the trust. In other words, you must place these assets in the trust – commonly referred to as “funding” the trust. Moreover, because our lives are always changing (marriage, childbirth, home purchase, etc.) and so are tax laws, it is essential to continually update and monitor the funding of your trust over your lifetime. For these reasons, you will want to work closely with your family trust attorney to make sure your assets are properly aligned with your trust. This will not only help you get organized, but it will also make things much easier for your heirs when you pass away. And you don’t have to go it alone. The right attorney can be an invaluable help to you and your family.

Dedicated to building your wealth, empowering your family and securing your legacy,

Marc Garlett 91024

Estate Planning For the Newly Married

newlyweds 91024Now is the perfect time to start working on an estate plan—because, as newlyweds, you may not have a list of your accounts, but you’ve effectively just done a working inventory of your possessions—as you’ve figured out how to consolidate two households into one. You’ve already been working on the new banking and shared responsibility of bills and taxes and so forth.

Use all that time and energy and work as a leapfrog into planning for your future—so you’ll be that much more prepared for the house, the kids, and the next stages of your new life together.

Why Think About Estate Planning at This Point?

Even if you have few assets, you probably have more than you think. Still, putting together a will or a trust is probably very straightforward at this point, since, as we just talked about, you recently did an accounting of your collective assets.

You may have heard of California state laws that give your property to a spouse if you don’t have a will. These laws—known as intestacy laws—vary depending on your circumstances and can sometimes have results you wouldn’t expect. And, intestacy requires your estate to go through probate—a court proceeding that can take years, to resolve. So a basic estate plan should give you some peace of mind—knowing loved ones are taken care of if anything should happen.

You can even plan for property you don’t yet own (a house you may buy someday) and provide for children whenever they arrive on the scene. And once you have that initial plan in place, you can easily update it as your circumstances and needs change.

Furthermore, if you already have a sizable amount of assets then estate planning may lead to tax benefits, now and in the future.

Who Can Make Decisions For Me, If I Can’t?

In the U.S., a power of attorney (POA) is a legal document that designates someone else (often a spouse) to make financial and other decisions on your behalf. In the financial realm, your POA can sign contracts, file lawsuits on your behalf, and more. Depending on the exact language, you can grant the POA broad powers, or something more limited to an issue or situation.

One specific form of POA is in effect only if you are unable to make decisions on your own—such as an emergency or illness. And you can have that type of POA for both the financial side of things, as well as one relating to your medical care.

What Kind of Care Would I Want?

An advanced directive (also known as a living will) is a document that makes clear the kinds of medical interventions you’d prefer if you’re unable to make decisions for yourself. In some ways, think of this as an emotional insurance policy: You make decisions now, so the people you love won’t have to later when you are unable to guide them. This can also make it easier for your spouse to make emergency decisions if you’ve named them as a medical decision maker.

Who Will Look After The Kids?

If you don’t yet have kids but want them someday, realize that an estate plan is essential for families with children. The state statute providing assets for a spouse will also include some inheritance for children.  How much depends on how many children.  However, when it comes to guardianship, you need a will to designate caregivers for the children, should something happen to both parents. You’ll want to name both temporary and permanent guardians.  Without these documents, the court decides on the children’s caregiver, and they may end up in foster care while the court makes its decision.

As you start your new life together, one of the best ways to begin is by planning for the future, whatever it may bring. We’ve been helping families of all ages and kinds for years, and we’d be delighted to help you, so let us know if you have any questions.

Dedicated to empowering your family, building your wealth and securing your legacy,

Marc Garlett 91024

My Big Lesson From 9/11

911Like many of you, I watched the remembrances and commemorations covered on television Monday, September 11, this past week.  I thought a lot about that fateful day 16 years ago, my memories of watching the towers come down still vivid in my mind.  The horror, the sadness, still heavy on my heart.  The heroic actions of so many brave men and women still giving hope to my soul.

And then on Tuesday, the very next day, I was listening to motivational speaker Winn Claybaugh, as he addressed the Sierra Madre Rotary Club about experiencing the very same feelings I myself had just the day before.  We shared the knowledge that those thousands of people, trapped in airplanes or buildings, suddenly realized they were in the very last moments of their lives.  And we both thought about how that must have felt – but of course, we can’t really know.  The one thing we do know, however, beyond a shadow of a doubt, is that many of those people, comprehending they only had moments left to live, chose to use those precious last few seconds to make phone calls.

We’ve all heard the stories.  And we know they didn’t call their bosses, or their employees, to complain about stress in the workplace.  We know they didn’t call a neighbor or relative they were having a dispute with to take one final parting shot.  We know those that could, made phone calls to the people they loved most in the world.  And we know the simple message they conveyed was a message of love.  “I love you,” they said.  “No matter what happens, know that I love you.”

Because in the end – the literal end – nothing else mattered.  At all.  To a person, they just wanted to hear their loved one’s voice one last time.  They wanted to send one final message: “I love you.”  That was their priority; the most important thing in the world.  Nothing else mattered.  Can there be any doubt love is stronger than hate?  Can there be any mistake that what’s most important, when everything is all said and done, is the love we have for our families?

How amazing is that?! What a tribute to us as human beings. And yes, pure evil does reside in some human beings. That’s always been the case.  But there is also such pure goodness and love in so many of us.  And ultimately, this all speaks to why I love doing what I do.  Because at the very end, nothing matters but the love we have for our families.  Estate planning is the way – the only way, in fact – to guarantee that last message of love, security, and hope comes through to our loved ones loud and clear.

And when it comes right down to it, that’s the only thing that matters.  So, my question is this: have you taken the necessary steps to ensure your final message will be clearly heard and unequivocally understood by the people you love most in the world?  Estate planning can – and should be – about so much more than just legal documents.  It is – and must be – about successfully finishing the most important message of your life to the most important people in your life.

If you haven’t gotten it done yet, stop procrastinating.  Get your estate plan in place.  Don’t let the most important opportunity of your life pass you by.

Dedicated to empowering your family, building your wealth and securing your legacy,

Marc Garlett 91024