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Kennett Square Probate & Estate Law Blog

Baby Boomers and durable powers of attorney

As the Baby Boomer generation enters retirement, these Americans will have a unique set of needs when it comes to estate planning. Many Boomers in Philadelphia have already set up their estate planning packages, but they may not be reviewing and revising those documents as their circumstances change. This is especially true in regard to durable powers of attorney.

Most married couples simply name each other as their designated proxy for health and financial matters. They assume that if one party becomes injured or ill, then the other will be the best equipped to know how to handle matters. This presumption is correct in most cases, but there are circumstances that can render both parties incapable of fulfilling that role.

Estate planning for both an inheritance and long-term care

No one knows exactly what the future might hold, which makes it difficult to plan ahead for every conceivable outcome. That said, everyone is aware that many people will require some type of long-term care as they age. Despite understanding the high probability that such a need might arise, many Philadelphia residents fail to plan for that outcome. Fortunately, there is an estate planning option that can address both the need for long term care coverage, as well as the desire to provide an inheritance for loved ones.

Life insurance can help an individual attain both goals. Certain policies (but not all) offer a long-term care rider that accompanies a life insurance policy. If the policyholder ends up requiring long term care at some point in his or her lifetime, the policy rider kicks in, and the death benefit is accelerated. That provides funding that can be used to cover the cost of care. The downside is that using the policy to pay for care needs means that there will be less money left that can be passed down to one's heirs.  

Estate planning law change could prompt review of plan

Many Philadelphia residents have worked hard to create plans for their estates that meet their specific financial goals. That is a major accomplishment and should bring about a sense of comfort in knowing that these important matters have been taken care of. Over time, estate planning rules and regulations will shift. That makes it crucial for individuals and families to make a periodic review of their existing plans to determine whether updates are needed.

An example lies in the recent move by Congress to increase the estate tax exemption amount to $5.45 million for the year 2016. That amount doubles for married couples, who will now have an exemption amount of $10.9 million. This means that any assets that fall below those thresholds can be passed down to heirs free from estate taxes.

Prince's presumed heirs in court just days after his death

Virtually no Philadelphia resident is unaware of the life and career of mega-star Prince. The musician recently passed away, and it appears that he may have had no estate plan in place to outline his wishes. His siblings (who are also his likely heirs) have filed court documents asking that a special administrator be assigned to the star's estate, which is the first steps in what is expected to be a long and arduous legal journey.

Prince was not only known for his musical talent; he was also among the earliest artists to demand the rights to his own artistic efforts. He battled with his record label for years, and felt strongly that holding the rights to his music was imperative. Ironically, if Prince did not create a solid estate plan, the rights to his life's work could become the center of a lengthy and expensive legal battle.

Estate planning for second and later marriages

Any time that a Philadelphia resident goes through a significant life event, there is a need to revise his or her existing estate plan. This is especially true when a second or subsequent marriage takes place. A new union not only creates new family ties, but it also serves as a reminder that it may be time to update or change previous estate planning measures.

In many cases, a spouse who marries a second time will already have children from a previous marriage. He or she often feels the need to create a plan that will provide for all surviving loved ones. That can be tricky when there is a blended family involved, and it will require careful estate planning measures.

Estate planning can protect an individual's social legacy

Not everyone approaches estate planning with the focus of passing down accumulated wealth to their children and grandchildren. In many cases, Philadelphia residents have spent a lifetime building their business or creating a body of creative work, and wish to preserve that legacy for the future. Even in the absence of a child or grandchild who is able or willing to take on those responsibilities, it is possible to structure an estate planning package that will allow one's work to live on, even after they have passed.

A prime example is found in the life and legacy of Alfred Nobel. Father of the Nobel Prizes, the inventor, chemist and engineer was the mind behind the invention of dynamite, a product that made him a very wealthy man. After public opinion turned against him for creating a substance that could destroy human lives so easily, Nobel sought to change his legacy, and his estate plan funded the Nobel Prizes. In the 120 years since his death, the name Nobel has become synonymous with acknowledging great achievement in science, technology, world peace and literature.

One way to help avoid an inheritance dispute

For many Philadelphia families, estate planning is a complicated affair. Often, parents wish to divide their savings and assets between their surviving children, but that division is not always equal. Passing along an unbalanced inheritance can cause a great deal of family strife, but there is a simple way to lessen the chance that siblings will engage in a lengthy and bitter inheritance dispute.

Once the decision-making process is complete, the next step is to gather the family together to discuss the overall estate plan. Each family is unique, and some will choose to include the spouses of each child, while others will limit this meeting to immediate family only. No matter who is invited to attend, both parents need to be on the same page about what level of input is going to be accepted. Will this be a meeting in which parents tell their kids what has already been decided, or is it a meeting where the kids are asked to provide their input on the matter?

What to look for in an estate planning attorney

Some Philadelphia residents require the services of an estate planning attorney in order to create their wills or to structure a trust. Others need to find an attorney to initiate or defend against probate litigation. In order to make the best possible choice, it is important to understand that not all estate planning attorneys make probate litigation a significant part of their practices.

In order to succeed in court, one's attorney must be knowledgeable in both current law and courtroom practices. He or she should be just as skilled at presenting an argument in front of a court as in drafting documents in an office setting. Understanding how cases play out in front of a judge is critical to structuring a plan for success.

Consider the "estate" in estate planning

When some Philadelphia residents hear the word "estate," they may think about a mansion set in an expanse of green lawn, perhaps surrounded by grazing horses and with an large gate at the end of a winding drive. In reality, the word simply means the collected assets of an individual at the time of his or her passing. Virtually everyone has an estate, even though the contents of each estate will differ. In the same way, virtually everyone can benefit from estate planning, even though the level of complexity of those plans will also differ.

Consider, for example, a couple who have slowly paid off their mortgage over a period of 30 years. They have paid off all of their debt and have managed to set aside a modest amount for retirement. One spouse earned a pension during her career, while the other inherited a small family vacation spot on a nearby river. They live well within their means and are about to begin drawing retirement.

Baby Boomers may have unique estate planning needs

As the American population continues to age, individuals from the Baby Boomer generation are nearing or entering retirement. Boomers may have specific estate planning needs that are going unnoticed. A recent article takes a look at the unique scenario facing millions of aging Americans, both in Philadelphia and across the nation.

As Boomers age, many are taking on responsibility for their own aging parents. This means they are setting aside their own needs and desires to ensure that their parents are cared for in loving environments. This is a wonderful thing for an adult child to do, but it also creates a set of risks. Should the Boomer child predecease his or her parent or parents, which provisions will be made to address the parents' continuing care needs?

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Larmore Scarlett LLP

Larmore Scarlett, LLP
123 E. Linden Street,
P.O. Box 384

Kennett Square, PA 19348

Phone: 610-444-3737
Fax: 610-444-9532
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