Attorney & Mediator
Attorney & Mediator

You’re Going to Have a Baby!

If you are about to be a parent, it is time to get serious about planning for your child.  Lots of plans will get made about baby clothes, strollers, and the color of the nursery.  Often left out is planning for the future – is something unexpected should happen.

First, you need to sign a Will.  This is where you name a Guardian to raise your child if you are unable to be there to do so.  If you don’t, a Court will decide the child’s fate. 

While Probate Court Judges take this very seriously and want to make the “right” decision, they will never have enough information available.  They don’t know your family and friends the way you do.  Imagine the dilemma for a judge when a bunch of seemingly nice relatives all come rushing into court to be the Guardian of your child.  Who to choose?  His sister?  Her mother? 

This is often a difficult decision for the parents themselves to make and is frequently the reason that this does not get done.  Mom thinks her family should raise the child and Dad thinks his should.  As difficult as it is, you need to decide and put it in your Will.  In the event that both parents will to die in an automobile accident, someone needs to raise the child or children.

Next, unless your prospective guardian is wealthy, you will need life insurance to cover the cost of raising your child.  When you are young, this is relatively inexpensive.  You should purchase enough coverage to make sure that your child or children can be raised appropriately and have a little extra for college.

What if only one of you dies?  You still need that life insurance.  If the primary earner dies, the money will be required to continue the family in the home and at the same level of living.  If the parent who is primarily handling the child rearing tasks dies, it will cost a bundle to replace all of the services that he or she provided.

Two important steps to take before the new baby arrives – every bit as important as deciding on furniture for the nursery.

Second Marriages – Issues in a Pre-Nuptial Agreement

It is always highly recommended that a couple getting married for a second (or third) time enter into a Pre-nuptial Agreement. 

First, if you are seriously contemplating marriage, you need to be able to discuss the financial and legal issues that arise.  These issues affect your present, your future and your family when you are no longer here.

The issues break down into three primary categories:

 

1.         Financial issues concerning day to day living.  This may seem nit picky, however, if not addressed up front, it can be the root of many problems down the road.

Whose house are you going to live in?  Will the owner pay the taxes?  The maintenance?  The repairs?  If these are going to be jointly paid, will the non-owner acquire an ownership interest in the home? 

How will food, vacations, transportation and vacations be paid for?  Will there be a joint account into which you place money for the payment of these joint bills? or will each party bear the responsibility for his/her own expense?

What about the house you will live in?  What will happen to the house when the owner dies? If, for example, you both decide to live in one party’s home, but he/she wants his or her children to inherit the home upon the owner’s death, putting the house in joint names is not an option. However, how long should the survivor be permitted to live in the home prior to being forced to move?   Should the survivor have a life estate? Could that tie up the home too long?

 

2.         Death of One Party.  This is addressed in a Pre-nuptial Agreement for several reasons.  While the parties can agree that they will not be providing for one another at death, and then prepare Wills that give their assets all to their respective families, the law does not presume that an individual can disinherit a spouse.

Therefore, if there were no Pre-nuptial Agreement and the decedent’s Will totally disinherited the survivor, that survivor could then go in and challenge the Will and insist on getting the survivor benefits available to a spouse without a Will.

If on the other hand, there is a Pre-nuptial Agreement, this statutory benefit can effectively be waived by the parties.

 

3.         Divorce.  No one gets married with the anticipation of getting divorced.  It does happen.  Best to address this issue in a Pre-nuptial Agreement.

 

A usual arrangement for a second (especially later in life) marriage is to state that each takes away what they came in with.  Anything acquired jointly is to be split.

While the discussion may initially be uncomfortable, a Pre-nuptial Agreement is a very necessary component of a second marriage.                       

 

Young and Poor – Who needs an estate plan?

Young and Poor

The simple answer: Your kids do.  If they are over 18, you will be unable to help them make health care decisions or manage their money once they turn 18.  This is true even if they are still in high school.

They are on your health insurance plan but you cannot challenge the insurance company or even question the disallowance of a cost for them.  They are adults.  They may not have any idea of what question to ask or how to go toe to toe with the claims representatives – but that is the law.

You may be paying for their tuition at college but the college won’t talk to you about their bill because the student is an adult. 

If your 18 year old child is in an accident, you will not be able to assist in determining their health care needs.  You will have to go to Probate Court to be appointed as the child’s guardian if he or she is not able to speak for him or herself. 

Can this really happen?  Yes.  It happens every day.  Accidents are the leading cause of death for young adults. 

So on the 18 year old’s birthday, in addition to a cake and candles, you should give them a Durable Power of Attorney and a Patient Advocate Designation to sign. 

Parenting rights for same sex couples in Michigan – going to Supreme Court

I frequently get calls from same sex couples who either have or are contemplating having children. They want to know whether one partner can adopt. Sadly, the answer in Michigan is NO.

A creative judge apparently tried to assist, but the adoption was struck down. Now it is going to the Supreme Court.

Read more at: http://cnnradio.cnn.com/2013/03/12/michigan-moms-gay-adoption-heartbreak/?hpt=hp_t3

How much should I tell my children?

This is a question that I get quite often.  There is no correct answer.

 

First, your assets are your business.  You have no obligation to tell your children how you are spending your money, nor to tell them how you plan on distributing those assets at your death.

Next, legally, you do not have any requirement to give your assets to your children upon your death.  You cannot totally disinherit your spouse, however, you can leave your children either individually or collectively nothing.  It is not their inheritance until you have passed away.

This leads to the issue of what to tell your children.  If you are going to give them copies of your estate plan, then you need to continue to do this as you update the plan.  Children who believe that they are getting a certain percentage of an estate because they saw a Will or a Trust years ago will be difficult and angry if the plan was changed, they did not see the changes, and they get less upon the distribution of the estate.  This is the type of situation that leads to litigation.  Therefore, if you distribute copies of your Will or Trust to your children, make sure that you keep them updated as you make changes.

If you choose not to give them copies of your estate planning documents, what do you tell them?  Simply inform them that you have had an estate plan prepared and where you have secured the original of the Will or the Trust.

If you are planning on giving some of your estate to charity or to friends, you might want to mention this fact to your children.  Again, surprises are the situations that create anger and litigation.  If your children know that you will be giving some of your estate to charities or friends, they may not like it, but they will learn to accept it. 

Consistency is the key.