Attorney & Mediator
Attorney & Mediator

Estate Planning: After the documents are signed – additional next steps – LEAVE A ROADMAP

In addition to leaving a spread sheet of information concerning all of your bills, I encourage clients to also print out a copy of the statements from their asset accounts. This is easily done when quarterly reports are received, either by mail, or via electronic format.

There should be a copy of your bank savings and checking account statements, your retirement account statements (401K, IRA, Roth), annuity statements, investment statements. It is less important to update these than it is to have the account information with your estate planning documents. This will give your agent (under your Durable Power of Attorney) or your Personal Representative (under your Last Will and Testament) a road map to your assets with the institution, account number and broker or agent.

Additionally, include a copy of all of your real property. Often times, clients have parcels of property in a different area of the state or in another state that their agents are not aware of. Make certain that this information is readily available.

In this way, your agent or Personal Representative will know exactly what you own, where it is located and the value of the property involved. It is only when an agent has this information that they can effectively do the job that you have requested.

Estate Planning: After the documents are signed – the next steps

So you have signed your Will or Trust, your Durable Power of Attorney and Patient Advocate Designation.  Are you all done?  Not yet.

First, have you made and given copies of the Power of Attorney and Patient Advocate Designation to your agents?  This is an important step.  They must sign the acceptances; further, they will need a copy of the document if they are to act on your behalf.

Next, have you checked beneficiary designations?  These override the provisions in your Will.  This can alter the distribution that you anticipated.  Make certain that these are consistent with your overall plan.  Also, make certain that there are not beneficiaries that were listed long ago that are inappropriate for today.  This includes IRAs, 401Ks, life insurance and bank accounts.

Another very important step concerns the availability of information for your agents.  If you were incapacitated, how would your agent under your Durable Power of Attorney know which bills to pay and when?  Today, with on-line banking, we do not receive statements in the mail.

Make a spread sheet of all of your bills and how they are paid.  List whether they are automatic debits from savings or checking, or automatically charged to one of your credit cards.  Are there monthly bills that are not automatic?  Are there bills that you must do on-line to pay?  If so, the account number, user name and password are critical for your agent to access the account.  These should be listed and left in a secure location.

Tell you agent where this information is kept so that in an emergency, it can be readily accessed.

If this information is on your computer, does your agent have the password to open your computer programs?

While this may seem time consuming, it is important to have all of this information in one location: account numbers, when bills are due, how they are paid, user name, passwords.  In this way, your agent can assist you effectively if you are incapacitated.

Estate Planning: 529 Plans for Children & Grandchildren

Summer is passing by at lightning speed and it’s getting closer to “back to school” time. So, it is probably a good time to think about options available for your children’s or grandchildren’s college education.

The 529 Plan is a college funding plan, sponsored by the state. It permits you to make cash contributions to this investment account and the earnings are not taxed federally so long as the withdrawal is made for qualified higher education expenses. Those would include tuition, books, supplies, computer equipment, and some room and board.

You may make gifts of up to $14,000 per recipient (or $28,000 for married couples) per year without triggering gift taxes without using any of your lifetime exemption. Additionally, 529 Plans permit you to “bunch” five (5) years’ worth of annual gifts into a single year. Therefore, you may gift $70,000 per recipient ($140,000 for married couples) in the first year. Once you do this, you may not make another contribution to the plan until year #6.

There are a few disadvantages. One is that the contribution must be cash. You cannot gift stocks or real estate. Additionally, the money will be counted if the student is seeking financial aid.

If the child or grandchild decides to forego college, the beneficiary can be changed to another child or grandchild.

While a 529 Plan may not be ideal for everyone, it merits a closer look when you are planning for your child or grandchild’s future.

Probate Matters: You are not Responsible for the Deceased’s Debts


When someone dies, they just as often leave debts as they do assets.  The family is concerned that they will be responsible for the debts of the deceased family member.

They will receive calls from bill collectors who try to shake them down for the money – threatening lawsuits and liens.  After all, that is their job, to get as much money on the outstanding bill as they can.

Generally speaking, a spouse or child is not responsible for the debts of their deceased spouse or parent.

You are only responsible for the debt if you co-signed for the loan or obligation.  This could be true on a mortgage or a credit card that is in both names.  If you have not co-signed, you are not responsible for the debt.

Sometimes a family will find that the assets of an estate are less than the debts that the deceased had.  In such a case, the only ones who will be benefitted by opening a probate estate are the creditors.  They will divide up the assets that are left.  In such a case, you as a family member do not have an obligation to open up a probate estate.  If the creditors want to open an estate to get paid, they may do so.  It is not up to you to do it for them.

The estate of a decedent consists of the property that he or she had in his or her own name alone at the time of death.  Therefore, the jointly owned property such as bank accounts or real estate (unless it has a mortgage) will simply pass to the family members outside of the probate court process.  All that will be left will be the assets in the deceased’s name and lots of debts.

If your parents have died, before you start paying bills, evaluate whether the debts of the estate are greater than the assets available.  If you are uncertain, call a Probate attorney and sit down for an evaluation of the estate and whether you should pay the claims.

Do not be bullied by creditors and bill collectors.  Call an attorney first – you may save thousands of dollars.