ElderLaw News — The Estate Planning & Elder Law Firm, P.C. — MD, VA, DC
ElderLaw News

ElderLaw News is a weekly e-newsletter that brings you reports of legal developments and other trends of vital interest to seniors and their advocates. This newsletter is brought to you by The Estate Planning & Elder Law Firm, P.C., William S. Fralin, Esq., President.

Estate and Financial Planning: It's Never to Early to Start

Far too often, estate and financial planning is something that is postponed until later in life. Individuals assume that they are not old enough or do not have enough assets to warrant this type of planning.

The reality is that estate and financial planning are not just for older individuals or those with substantial assets. It is also for those who are just starting their career or starting a family. People are healthier and living longer than ever before, and these factors require more planning today than in times past.

It is also important to recognize that estate and financial planning should not be neglected until the time that it becomes a necessity. While life transitions are often emotionally and financially stressful, being prepared can help minimize stress and regret. You don't know what may happen tomorrow. You can, however, make sure that you have a plan in place to protect yourself, your assets, and, most importantly, your family. Being proactive, not reactive, can help to ensure that you or a loved one are satisfied and content with the outcome.

Being prepared, however, is only one part of the equation. Your estate and financial plans must work together to form a comprehensive and cohesive strategy. This is why it is imperative to meet with an attorney who can provide this type of comprehensive approach to your estate and financial planning needs.

The following is a brief overview of several planning tools that should be considered in preparing your estate and financial plan:

Will: A will does more than simply give away your assets - it ties your estate plan together. Accordingly, your will should incorporate the proper tax and financial planning techniques. Your will can also designate a guardian for your minor children, as well as the person who will manage their finances.

Living Trust: A revocable living trust is a useful tool for avoiding probate. In many cases, a living trust can offer you better control of your assets, not only after your death, but also during your lifetime. When using a trust, several options should be considered, such as whether you desire to leave assets to your children in further trust for their benefit instead of passing outright. This type of trust may continue for the life of the child, providing valuable asset protection in case of creditors or divorce. Conversely, the trust can make full or partial distributions of trust principal at certain ages, such as providing half of the trust assets to your child at age 25, and the remainder once the child reaches age 30.

Power of Attorney: A general durable power of attorney is an invaluable planning tool. Often the most important document a person can execute, a power of attorney designates the person you want to manage your assets and personal affairs if you become disabled or unable to manage your own affairs.

Advance Medical Directive: An advance medical directive combines two documents: a living will and a medical power of attorney. A living will sets forth your end-of-life wishes, while a medical power of attorney names the person or persons that will make medical decisions for you when you are not able to do so.

Life Insurance: Life insurance can be an extremely useful planning tool, especially for younger individuals and those without substantial assets. Life insurance is a great way to ensure that your child or surviving spouse will receive financial support in the event of your untimely death. One of the most common mistakes when using life insurance, however, is purchasing inadequate coverage. According to a 2009 report by the U.S. Department of Agriculture, the average cost of raising a child through age 17 is just slightly over $200,000. When the cost of college is included, this substantially increases. An experienced estate and financial planner can assist you in determining the amount of life insurance needed to provide your loved ones with the financial assistance they will need.

Once you have made the decision to begin preparing, it is imperative that you approach your estate and financial planning from a comprehensive perspective. Otherwise, you may have all of the pieces in place, but the pieces may not fit together in the way that you intended. For example, certain financial accounts allow the policy owner to designate the beneficiary of such policy. These beneficiary designations control who receives those assets, not your will or trust. This is why it is crucial that your plan is comprehensive, with all elements working together to achieve your desired result.

The attorneys at The Estate Planning & Elder Law Firm can assist clients with their estate, financial, insurance, long-term care, veterans' benefits and special needs planning issues.

Speakers

If you are interested in having an Elder Law attorney from The Estate Planning & Elder Law Firm, P.C. speak at an event, then please call us at:

Maryland (301) 214-2229
Virginia (703) 243-3200
Washington DC (202) 223-0270

The Estate Planning & Elder Law Firm, P.C.

The Estate Planning & Elder Law Firm, P.C. is an elder law firm. We represent older persons, disabled persons, their families, and their advocates. The practice of elder law includes estate planning, estate and trust administration, powers of attorney, advance medical directives, titling of assets and designations of beneficiaries, guardianships, conservatorships, and public entitlements such as Medicaid, Medicare, Social Security, and SSI, disability planning, income tax planning and preparation, care management, and fiduciary services. For more information about The Estate Planning & Elder Law Firm, P.C., please visit our website at http://www.chroniccareadvocacy.com.

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This newsletter is not intended as a substitute for legal counsel. While every precaution has been taken to make this newsletter accurate, we assume no responsibility for errors, omissions, or damages resulting from the use of the information in this newsletter. The Estate Planning & Elder Law Firm, P.C. thanks the law firm of Hook Law Center for their input to this newsletter.

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