Planning for College Age Children

Tuesday, 25 September 2012 23:16
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This post is a month late.  Before kids departed for college, parents should have had their children execute a simple set of health care directives so that parents can receive medical information about, and make medical decisions for, their college age children.  This is especially important for children from divorced families where it is unclear which parent is the decision maker.
The recommended documents are a health care power of attorney (to make the medical decisions) and a HIPAA disclosure so a parent can receive information about their child’s health status after a bad Ecstasy trip or injury while car surfing.

Smart Rider

Friday, 21 September 2012 23:15
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The late Dennis Hopper made several wise estate planning moves late in his life. First, he had a pre-nuptial agreement when he married his fifth wife. Second, when he was dying and was in the midst of an acrimonious divorce with her, he created a trust for their then 7 year old daughter to which he left nearly $3 million. The then estranged spouse/now widow has no control over the trust assets.
Two points. When a couple is divorced with minor children, I always advise my client to create a trust to hold assets for the children upon the death of the client. Otherwise, the former spouse will control the assets until the child turns 18 and may benefit from the assets. Second, when marrying for the 5th time, I am glad to see that Mr. Hopper had learned enough from his 4 previous failed marriages to execute a pre-nup. Old dogs can learn new tricks.

There Is Gold in the Walls!

Thursday, 20 September 2012 23:13
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After an unmarried Nevada man died, authorities discovered $7 million of gold bars and coins stashed in his house.  The man had lived alone since his mother’s death in 1992.  He was apparently dead for a month before neighbors reported a smell emanating from the house.  His left no will so his first cousin, whose phone had been disconnected, will inherit the estate as his closest relative.
I am uncertain about what lessons can be learned from this story but I will suggest a few.
1.  It is always best to leave a will instead of relying on the intestacy statute to determine where assets where go after death.
2.  People should check on their “crazy neighbors” because they, instead of cousins with disconnected phones, might inherit assets at death.
3.  Living isolated and alone without visiting doctors can lead to a premature death.
4.  Gold has been an incredible investment the past several years.

Beneficiary Designations and Asset Titling

Tuesday, 18 September 2012 23:10
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The best estate plan will not work if beneficiary designations and asset titling are not coordinated with the provisions of the will and trust. Common mistakes includeadding a child’s name to a house deed, adding one child as the transfer on death beneficiary of a financial account to the exclusion of the other children, or not avoiding the probate process by transferring the asset to a trust or adding a transfer on death designation.

I always provide my clients with a list of how to address beneficiary designations and asset titling issues. If the issues are not handled properly, one child can inadvertently inherit most of the estate to the chagrin, and lasting contempt and hostility, of the other children.

Digital Assets (Heavy Sigh Version)

Wednesday, 12 September 2012 23:08
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At the risk of beating the dead horse about digital assets, some articles need to be mocked.  This recent WSJ article deserves derision for making a simple topic – how to access on-line accounts of a deceased person – stupidly complex.

Suggestions include the creation of a social media will with a review of each web site’s policies, the nomination of a digital or social media executor, and creation of digital asset trust to avoid those assets going through the probate process.  My responses to these ideas, in order are:  a standard will suffices, the executor should be able to address on-line issues and if he can not he should not be the executor dealing with assets with a monetary value, and only an idiot would list a digital account as a probate asset to be disposed of.  I suspect that some people think that there is money to be made from that idiot by selling him a trust that he does not need.

My advice remains creating a list of passwords accessible at death by the executor.  Simple is better and often times less expensive.