Elder Law Estate Planning Probate

Grieving Children Wish Mom Had an Estate Plan

Grieving Children Wish Mom Had an Estate Plan. When a parent dies somewhat unexpectedly, adult children may be overcome by grief. However, they then may become overwhelmed by frustration.

It’s almost too difficult to mourn right now—because the family can be too busy trying to take care of her estate.

This time can be especially hard, if the recently departed parent failed to leave a will, a trust or any estate planning whatsoever.

The recent article published on WSAV’s website entitled “Family warns others to not put off estate planning” says that in one instance, the family was forced to leave their mom while she was dying in the hospice to try and organize the paperwork done for her estate.

An estate plan is a guide for your family. A good estate plan will include not only a will, but also a health care power of attorney and a living will.

Work with an experienced estate planning attorney and try even harder to get everyone to the table to discuss the issues.
One way to approach aging parents, is to say “You are helping me, if you could write this down.”

Many regret not taking action sooner to save stress and energy resulting in Grieving Children Wish Mom Had an Estate Plan.

“You have every emotion you could ever have, because you are about to lose your loved one and you have to deal with everything else on top of it,” one woman commented.

Reference: WSAV (February 26, 2019) “Family warns others to not put off estate planning”

Elder Law Estate Planning

Why Do Even the Middle Class Need Estate Planning?

When it comes to estate planning, you may think that you don’t have the wealth that would require you to engage in extensive estate planning. If you have a will, you might think that’s good enough.

Forbes’ recent article, “Why Estate Planners Aren’t Just for the Ultra-Rich,” says that nothing could be further from the truth.


Although some estate plans are more complicated than others, just about everyone can benefit from having one. Let’s examine the main reasons why:

Avoiding probate. This is a big reason why the importance of estate planning is for everyone. You don’t have to be part of the 1% to want to avoid putting your family through the stress and expense of probate. Creating a trust and strategically placing assets within its control, eliminates many headaches.

Maintaining control from the grave. Even after death, you can still impact how your assets are distributed, as well as to whom and when.

Protecting your legacy. When you consider leaving a legacy for the next generation, it may have lofty pursuits. However, those aren’t necessarily reasonable goals for everyone. Leaving a legacy can also mean making certain that heirs properly respect all the effort and sacrifice that it took to save and create a retirement fund—whatever its size.

Creating a business succession plan. Among the countless small businesses in the U.S., most will continue to remain viable after the legacy owner dies. A business owner can plan for this within an estate plan, which details exactly what they want to happen, if they die unexpectedly. That could include outlining specific roles and responsibilities for surviving heirs or putting into place a buy-sell agreement with a business partner and directing the distribution the proceeds of the sale.

Be sure to revisit your estate plan regularly, especially if your life includes big events, like a birth of a child, a divorce, or an irreconcilable difference with a loved one.

It’s a myth that estate planning is something only wealthy people do. It’s for everyone.

Elder Law Estate Planning

Life Insurance for Elders?

Life Insurance for Elders? Should you continue to keep the policy, asks the Milford Beacon in the article “Should you keep your life insurance?”

For term insurance, the answer is fairly straightforward. If the need for the death benefit is done, like paying off a mortgage or being able to pay for the kid’s college educations, then you don’t really need to have the policy. If your health is good and you expect to live well and long, then you could simply let the policy lapse. You won’t need to pay the premiums, but the death benefits will be over, as of the date that the policy lapses.

An alternative is to convert the policy into one with cash accumulations. It isn’t the death benefit that you want, so much as the potential return of the cash value that could accumulate inside the policy. Some insurance companies may allow you to exchange your existing policy for a policy with hybrid features that include long-term care coverage and a death benefit. That may be useful, if you don’t otherwise have a long-term care insurance policy.

When the life insurance is a permanent or whole life insurance policy, things get a little complicated. First, the review should begin with what is called an “inforce illustration.” This is a forecast as to what can be expected to happen with the policy, if you keep it. The insurance company’s actuaries get to sharpen their pencils here. There are many different factors that go into the inforce illustration, including rate of return on cash value, the company’s dividend crediting rate, the number of years the premium has been paid and your expected mortality rate, among them.

What the inforce illustration will not show you is something your financial planner or estate planning attorney will: your policy’s “Internal Rate of Return,” also known as the IRR. The IRR on cash value shows how well your cash accumulates and what it earns inside the policy. You can then compare the IRR to other investments or savings, to see if this makes sense to keep.

Here’s a simplified explanation of the IRR. Let’s say you invest $10,000 per year and have a death benefit far larger than this. The IRR on death benefit will show you the return on your premium dollars that will be returned through the issuance of a death benefit check. If you die early in the life of the policy, the check will be large. If you have the policy for an extended period of time, the IRR declines and the numbers are more like those you’d expect from a fixed income investment.

Life Insurance for Elders? Another angle to consider: how does the life insurance policy fit within your estate plan? Would you want to have the proceeds go to a grandchild, now that your children have children of your own? Does it belong inside a trust? An estate planning attorney should review all your life insurance policies to see if they align with your overall estate plan goals.

Elder Law Estate Planning

Life Insurance in My Estate Plan?

You’re not alone if you don’t fully understand the value and benefits that life insurance can give you as part of a retirement plan. Kiplinger’s recent article, “Don’t Overlook Advantages of Making Insurance Part of Your Retirement Plan,” says many folks see life insurance as a way to protect a family from the loss of income in the event a breadwinner passes away during his or her working years.

If that’s your primary purpose in buying a life insurance policy, it’s a solid one. However, that income-replacement function doesn’t have to stop in retirement.

When a spouse passes away during retirement, the surviving spouse frequently struggles financially. Some living expenses might be less when there’s just one person in a household, but the reduction in costs rarely makes up for the drop in income. One of the two Social Security checks the couple was getting goes away, and a pension payment may also be lost or reduced 50% or 75%. Life insurance can be leveraged to make certain there’s sufficient cash to compensate for that missing income. This lets the surviving spouse maintain his or her standard of living in retirement.

Why should I have Life Insurance in My Estate Plan? There are several sections of the tax laws that give life insurance income tax and transfer tax benefits. For example, death benefits typically are paid income-tax-free to beneficiaries and may also be free from estate taxes, provided the estate stays under the taxable limit. Also, any benefits paid prior to the insured’s death because of chronic or terminal illness also are tax-free. This is called an accelerated death benefit (ADB) and is a pretty new option. If your insurance doesn’t have this coverage, it can probably be added as a rider.

Finally, cash values can grow within a permanent life insurance policy without being subject to income tax. Any cash values more than the policy owner’s tax basis can be borrowed income-tax-free as long as the policy stays in effect. But if you were to pass away prior to paying back your policy loan, the loan balance plus interest accrued is deducted from the death benefit given to the beneficiaries. This may be an issue if your beneficiaries require the entire amount of the intended benefit. When the loan remains unpaid, the interest that accrues is added to the principal balance of the loan. If the loan balance increases above the amount of the cash value, your policy could lapse. That means you could you risk termination by the insurance carrier. If a policy lapses or is surrendered, the loan balance plus interest is considered taxable, and the taxes owed could be pretty hefty based on the initial loan and interest accrued.

There are fees that can includes sales charges, administrative expenses, and surrender charges. That’s in addition to the cost of the insurance, which grows as you age.
Just because you’re retired doesn’t mean you don’t still need the protections and benefits life insurance can offer you and your family.