One of the most overlooked aspects of estate planning is failing to properly title your assets. Coordinating the way that you title your assets with the type of estate plan you have can save you time and money and such a great deal of heartache for your loved ones.

Titling is directly tied to what happens to a person’s assets upon death. If a person’s assets are not titled in a manner that coordinates with their estate plan, upon death, certain dispositions specified in the will and/or trust may not be fulfilled. Therefore, your estate plan is only as good as your account titling. Understanding who owns what is a very important key to efficient estate planning; without the proper titling of property, even the most sophisticated and well-thought-out estate plan will fail.

A common example of this is that oftentimes people own different types of properties that have been acquired at different times in life. If assets are incorrectly titled in their will, they will not be distributed where they are intended to go. The title on the will often supersede what the will says and any other legal documents.

There are three ways that assets can be held at the time of death: fee simple (individually), tenancy in common (jointly), or by joint tenancy with right of survivorship (by contract). If assets are held fee simple, they are in your own name. If assets are held tenancy in common, they are held with at least one other person. And if a named beneficiary holds assets, they are held by joint tenancy with right of survivorship. Depending on your goals in life, and your wishes after death, the way you title your assets could be the difference between financial security and financial hardship for your family and/or beneficiaries. It is generally considered the best option to have major assets, such as real estate and investment accounts, held in the name of a couple’s or person’s revocable living trust.

As an experienced attorney in estate planning, Jim Ward will help you understand the differences between the various types of property ownership. His expert advice will not only guide you through a complicated process, but also ensure that your savings, investments, valuables, and real estate are distributed according to your wishes.

Please do not hesitate to call us today for a free assessment, 1-800-JIM-WARD.

When it comes to estate planning, making the proper beneficiary designations is an integral component of an effective estate plan. Understanding how your assets will transfer after your death helps you create an estate plan that ultimately grants your wishes and prevents unnecessary obstacles for your heirs. Some people may believe that creating an estate plan is too much work, or that they may not have enough assets to qualify as an estate. However, what you may not realize is that, (a.) your retirement savings are an important part of your estate, and (b.) your retirement savings will pass on to the beneficiaries named on the forms of your retirement savings accounts — not to the heirs named on your will or other estate planning documents. The same is true for life insurance.

“Avoid making mistakes that can cause an undesired effect after you die by properly designating your beneficiaries,” said Jim Ward. “As an experienced attorney in estate planning, I can help you avoid many of the common mistakes that are made when designating beneficiaries.”

A beneficiary designation clearly states who you wish to receive benefits upon your death. It’s imperative that you periodically review your estate plan with an attorney to make sure that all of your beneficiary designations are clear and current. This is particularly important when major life changes occur – including divorce, the birth of a child, the death of a beneficiary, or the marriage of a beneficiary.

Naming an “estate” as a beneficiary, not naming a beneficiary at all, listing a parent as a beneficiary after getting married and having children, not removing the name of an ex-husband or ex-wife as a beneficiary, or not having a contingent or secondary beneficiary are all very common mistakes.

In essence, reviewing and updating beneficiary designations is essential to creating an efficient distribution of your assets to heirs. Call Jim today for a free initial consultation so that he can assist you in choosing your beneficiaries strategically and within the context of your entire estate plan.

 

With regard to estate planning, when individuals fail to plan, they plan to fail. When someone dies, his or her assets automatically become part of the estate, which is then distributed according to the decedent’s will.

Probate is the system through which a court determines whether a will is legally valid before the inheritances it covers can be given out. The probate process encompasses more than just proving the validity of a will. It includes the entire administrative process, including determination of the decedent’s total assets, paying debts, liabilities and taxes — and the distribution of remaining assets to beneficiaries. In effect, probate is the process that enables the beneficiaries to receive property that is rightfully theirs.

However, if no will is left, state law determines the relatives who should receive the assets. Structuring financial affairs with the assistance of an estate planning attorney will help avoid probate costs. The administration of an estate is a technical process that requires strong legal knowledge as well as the consideration of possibly complex family dynamics.

It’s wise to hire a skilled and effective estate planning attorney to help before running into any legal issues, such as the scenarios listed here:

Estate Litigation

Please be aware of the fact that estate litigation is common and may arise. It’s one of the fastest growing areas of the law. Once the assets in a will are made known, creditors, tax collectors, heirs, and other parties may suddenly want to have a say in the way the funds of the deceased are disbursed.

Contested Wills

Contested wills oftentimes create a legal issue. The interpretation of wills is a very intricate and complex area of law. A will can be opposed or contested on the grounds that the document is void due to the incapacity of the testator at the time the will was made; the failure to comply with the formalities required by law, or any matter sufficient may show the nonexistence of a valid will.

Guardianship

Guardianship challenges may occur as well. Conflicts over the care of minor children, or, in some cases, legal wards of the deceased, are some of the most emotional disputes that can occur during probate.

Jim Ward is an experienced estate planning attorney with offices in San Jose and the South Bay area. If you are an executor of an estate, or simply have questions about how probate works, seek knowledgeable legal counsel from Jim today.

 

 

 

 

How Do You Learn About Medi-Cal Benefits?

As an estate planning and elder law attorney, I’m frequently confronted with clients who have been misinformed about the law. This is particularly true regarding Medi-Cal and the coverage of nursing home costs. Conflicting information results in confusion. It also sometimes results in lack of action or taking the wrong action. Make sure you’re talking to someone who really knows the current law.

There are attorneys, Medi-Cal “consultants” and insurance salespeople who pass on erroneous information to clients. This can be extremely harmful. I recently read a published column by an insurance agent who stated that “the loophole that some people used to try to hide assets in order to qualify for Medicaid (Medi-Cal) was closed by the Deficit Reduction Act.” That’s true in most states, but the DRA 2005, which became law in early 2006, has still not yet been adopted in California. Anyone who tells you otherwise simply doesn’t know the law in California.

(Also, if you do things lawfully, you aren’t “hiding” anything at all. That’s ridiculous. Hiding assets will get you charged with Medi-Cal fraud. Following the law is a safer bet.)

One client of mine recently called me after she met with the investment professional at her bank, and she informed me that the investment professional had warned her about trying to get Medi-Cal to pay for her mother’s nursing home expenses “because there is a 60 month look-back period that will mess everything up.”  My response was, “Well, that investment professional must be working in Texas, because that certainly isn’t the law in California.”

These people will also frequently warn about estate recovery and how the government can get back all of the benefits at a later date. That simply isn’t true with proper planning. Don’t be scared away from doing the right thing by people misleading you with false information.

One of the easiest ways to see that an “expert” doesn’t know what they’re talking about is to discuss the look-back period for transfer penalties. I frequently see literature or a website quoting a 36 month or 60 month period. If you see that, don’t make an appointment to see the person, or get up and walk out if you’re already in their office. That isn’t the law in California.

Medi-Cal is a confusing area of the law, and many people take advantage of seniors’ lack of understanding of the Medi-Cal laws to sell them overpriced products and consulting services. CANHR (California Advocates for Nursing Home Reform, a non-profit organization) fights against elder financial abuse and this type of misinformation. CANHR states that the prices for these non-attorney consulting services to “pre-qualify” seniors for Medi-Cal generally ranges from $5,000 to $20,000, and the products being sold generate large commissions. They state that “the prices for these services are typically two-thirds higher than what a licensed estate planning attorney would charge.”

I’ve seen it in my own practice. One client came to me when her son discovered that she had paid for Medi-Cal “consulting” from some insurance people who were currently being sued for selling nearly worthless products to other seniors. She had already paid thousands of dollars in consulting fees to these people, and she wanted to get that money back. Another “consultant” told the client that the consultant “could handle it all, and there was no need to go see an attorney.”  The result was that the man was charged several thousand dollars more than an attorney would have charged.

Protect yourself. Use a licensed attorney who is knowledgeable about Medi-Cal and works with the Medi-Cal regulations on a regular basis.

The Alzheimer’s Association strongly advises beginning legal plans if you or a loved one has been diagnosed with Dementia or Alzheimer’s disease. Dementia is a general term that refers to a cluster of symptoms such as the loss of memory, problems with communicating, and loss of other intellectual abilities serious enough to disrupt everyday life. Alzheimer’s disease is the most common form of dementia. Once a person is diagnosed with early dementia it is important that a family member, domestic partner, or friend assist the person in making legal plans. Legal planning includes making plans for health care and long-term care coverage, making plans for finances and property, and naming another person to make decisions on behalf of the person with dementia – and the planning needs to take place before the dementia becomes too severe.

A Durable Power of Attorney is a legal document that allows a person with dementia (called the principal) to name another individual (called an attorney-in-fact or agent), to make financial and other decisions for the principal. The person appointed is oftentimes a trusted family member, domestic partner, or close friend.

There are several areas that can create costly problems if you do not have a proper Durable Power of Attorney in place designating an Agent to act on your behalf during any period of incapacity. Conflicts can arise with real estate property, retirement benefits, estate and asset protection, and healthcare decision-making. On average, guardianship proceedings take months and can be quite costly in that they involve court filing fees, attorney fees, physician’s fees and court reporter fees. A well-drafted Durable Power of Attorney will give your Agent the authority to act on your behalf and to protect your physical well being as well as the financial well being of you and your family.

As essential as Durable Power of Attorney is, it faces new—and continuing—obstacles. Disruptions in the financial services industry as well as recent scams and frauds make it imperative for individuals to consult with a law attorney that can aid in creating a plan that not only provides financial protection for their family, but also ensures planning for their future.

Of importance, an attorney can explain what makes a Durable Power of Attorney “elder law friendly”. Many documents in existence today do not meet the potential needs of elder clients. These should be replaced with “elder law friendly” documents. As an elder law attorney, Jim Ward can assist in navigating the many variables associated with a Durable Power of Attorney. For example, whom can you trust as an agent? What powers should be included? When does the document take effect? When is a Durable Power of Attorney valid?

Jim Ward is an experienced elder law attorney who has offices in San Jose and South Valley. If you or a loved one has been diagnosed with Dementia or Alzheimer’s, proper legal planning is critical to avoiding financial hardship and emotional distress. Take the time to call Jim for a free initial consultation today.

Along with the increased number of the people in our society, the amount of caregivers in demand is expected to increase two-fold.

As people reach their mid-70s, nearly half will experience physical problems that will likely result in limited mobility or a decreased ability to care for themselves. They’re going to need help, but the challenging part is that there’s no job tougher or more demanding than that of a caregiver. Oftentimes, caregivers become emotionally or physically drained. The job of a caregiver can oftentimes result in anxiety, depression, loneliness or illness. This is true with professional caregivers as well as family member caregivers.

With a majority of California households requiring a second income, families often can’t take the time off to care for their parents. Because of this, it’s more than likely that most California families will need to hire someone from outside of the family. Usually, this will come in the form of an assisted living facility or in-home care. This can include anything from assistance with shopping and transportation to cooking meals, housekeeping or bathing.

Since a large number of households feel the weight of the responsibility of taking care of family members, it’s important to put a plan in place. The purpose of a plan is to help the “main” caregiver. Since caregivers are in danger of a breakdown when not given a break, family relationships are at stake. Unfortunately, it’s not uncommon for the process of caregiving to tear a family apart.

When families take the time to divide tasks into the categories of time, money, and labor — everyone can share the responsibility. Additionally, I recommend holding family meetings either in-person or by phone to discuss the condition of a loved-one or to re-negotiate the core responsibilities.

At The Law Offices of James A. Ward, we walk families through the process of caregiving. Our specialty is estate planning and Medi-Cal planning, and we help to establish asset protection plans both for a crisis situation and also long before any loved ones fall ill or are in need of care.

Don’t hesitate to call us today for a free assessment, 1-800-JIM-WARD.

San Jose Elder Law

For baby boomers moving into retirement and their golden years, times can be tough. Adult children are becoming caregivers and some are relied on to provide financial support for their parents and in-laws.

Statistics show that a little more than 32 percent of adult children chip in to help their parents out. And more than 75 percent of those that gave financial support to their parents wonder if their generosity will have an impact on their own financial situation in the future.

With the lagging economy we have seen, decreasing home values, investments that have gone bad, and savings that have been torn apart. Health care costs are climbing, and with most California households requiring a dual income, many cannot keep up.

“An experienced elder law attorney can help to preserve assets, as well as connect people with government benefits and resources to create a contingency plan that addresses possible changes in family health or finances,” said attorney Jim Ward of The Law Office of James A. Ward.

Doing the right thing by your parents is the main priority, however not being fully aware of the legal implications of this could possibly lead to lost Medi-Cal eligibility or negative tax consequences.

As an elder law attorney, Jim Ward can help mitigate these pitfalls. Consulting with Jim or someone who has the right knowledge in this area should be the main priority. Relying on advice from financial advisers or others that do not know the law is not a good idea when putting together a game plan for aging parents.

Jim Ward is an experienced elder law attorney who has offices in San Jose and South Valley. Consulting with an elder law attorney is critical at the outset of the beginning stages of retirement and when any sign of poor health or dementia comes into play. Take the time to call Jim for a free initial consultation today.

Estate planners and elder law attorneys are regularly confronted with clients in a crisis situation. The critical element for handling many of these cases is whether the client took those vital steps necessary to plan ahead before the crisis. Was there any planning at all? Were the planning documents prepared properly? Do the choices made earlier still reflect the current wishes? Are the documents legally valid?

It’s not uncommon to find people in their 60s, 70s, and even 80s who have done no planning. If they’re still mentally competent, they can set up a plan now. The problem cases are when there’s an accident, a sudden stroke, the rapid onset of dementia, or death. Who takes care of things for the individual, and what happens to the family? The family can always ask the government to intervene, but subjecting your family to Conservatorship (Guardianship) proceedings in court can be a very tortuous and costly experience, and the end result may not be what anyone really wanted.

Making advance arrangements for other people to make your decisions for you can save your family a lot of anguish, time, and money. You’re also more likely to get the end result you had hoped for in the event of a crisis.

Before a crisis hits, people should consider their long-term care needs and their family dynamics. If family members have squabbles or resentment now, that will likely intensify in a crisis situation. Frequently, an individual doesn’t want to offend a sibling or adult child by naming someone else to be the responsible person, so they name co-trustees for their trust, co-executors for their will, and co-agents for their durable power of attorney. The naming of two people to make the decisions together is an idea that frequently results in litigation and family members becoming enemies of each other when they disagree. It’s a risky option.

When it comes to family circumstances, families are always changing — births, deaths, divorces, second marriages, and self-destructive behaviors by heirs, are common issues. Is your son-in-law still the right person to make decisions for you even if he’s in the middle of a nasty divorce from your daughter? What if your financially astute mother is in the early stages of dementia when it comes time to make decisions that will affect you and your children?

Our laws are quite specific regarding the legal requirements of your planning documents. The do-it-yourself approach often leaves people with documents that are not valid, or are unclear as to the individual’s wishes. The use of do-it-yourself documents in estate planning is generally considered to be the number one reason for the growth of probate and estate litigation. You might save a few thousand dollars up front, but then your family burns through a few hundred thousand dollars in litigation expenses. It happens regularly.

If you haven’t yet arranged for others to make the necessary financial and health decisions for you, take the time to do it now. If you don’t have a legally valid document establishing the distribution of your assets upon your death, take the time to do it now — and do it all properly. You owe it to yourself and to your loved ones to get it done, and to get it done right. Lack of planning, and errors in planning, can be very costly for everyone.

 

What have you done about planning for yourself or your spouse down the road? Have you made it easy for others to care for you? Do you have the proper documents in place? Do you have long term care insurance? Is it adequate?

If you have long term care insurance, check it out and make sure that the coverage is adequate for you. Some policies may only cover a portion of what you’ll need, but check the monthly coverage amount and the lifetime benefit amount, and then add in your other income from Social Security or pensions to see if you think it will be enough. The cost of most nursing homes in our area is about $8,500 to $10,000 per month. If your long term care insurance will cover in-home care, then it may permit you to remain in your home much longer without moving to a facility that provides a higher level of care. Think about the total cost.

If you have assets that can be used to provide for your care, do you have the proper documents in place so that your spouse or children can access those assets? Do you have a durable power of attorney that is specific to the needs of elder law planning? Do you have a gifting plan in place, or have you given your agent gifting powers?

One of your goals should be to have the right documents in place so that others can care for you without going to court to establish a conservatorship over you or your assets. A conservatorship is something that you generally want to avoid. The emotional and financial costs of a conservatorship are high, but they can be avoided through proper planning.

What about Medi-Cal Planning? Nobody wants to go to a nursing home, but sometimes that’s the best — or only — option for someone. Statistics show that if you reach the age of 65 years, there’s a 50% chance that you’ll spend some time in a nursing home. And, the average stay for people who go to the nursing home is two and a half years. That’s 30 months.

A major problem faced by elder law attorneys who practice Medi-Cal planning is simply the lack of knowledge by the public. Most people don’t know that advance planning and crisis planning are available, and that the Medi-Cal laws specifically allow for this. A classic example of this is a woman I met at a wedding a few years ago. When I told her that I was an elder law attorney, she leaned forward and told me that they had spent over $500,000 of her mother’s money on nursing home care before anyone told them to go see an elder law attorney.  …  Shocking? It happens all the time.  …  But it doesn’t need to be that way.

Is there someone in your family who is struggling with dementia? Line things up in advance. Don’t wait.

I have a client whose father has had Parkinson’s disease for years, but he was still managing his own affairs okay so nobody sat down with the father to plan ahead. When the father suddenly slid into severe dementia, he couldn’t tell his son where his safe was hidden, why he had taken out a reverse mortgage that now had a high balance, or where all the money had gone. Was the father a victim of elder financial abuse? We don’t know.

The comment I often hear is, “I wish we would have started this two or three years ago.” Don’t let that happen to you. Plan ahead.

Jim Ward helps couples and individuals throughout the bay area with medi-cal planning. Call Jim today for a free consultation – 1-800-JIM-WARD.

Whether your children are minors or adults, there is always the question of whether you have taken care of them with proper planning, and whether you have made the right choices so that they can easily care for you if needed.

Life insurance can be a great asset in caring for your children, but people need to think it all the way through. Money alone won’t necessarily solve everything. Do you have legal documents that establish guardians for your minor children? Have you set up a trust for the money and established rules for using the funds?

One individual recently told me that he had no will or trust that would set rules for the support of his 3 and 5 year old daughters, but he and his wife had more than $2 million in life insurance set up to care for them. Really? Do you want your child to receive $1 million outright at age 18? How would you have handled $1 million when you were at that age? There’s more to it than just providing money for the support of minor children. Guardians should be named, and rules for the distribution of the funds should be established. Maybe they’ll need financial support before they turn 18. Who will control the funds? Think things through.

If you want your children or grandchildren to attend college, you can build incentives into the trust — but incentives are tricky and you should discuss options with an experienced estate planning attorney who can help you work through the downside to certain options. Some trusts only provide support if the child attends a four-year accredited institution, but what if the child wants to attend a community college first to save money, or wants to attend a special trade school or art school that doesn’t qualify as a four year program? Likewise, many trusts require that the child be a full-time student, but what if he or she is a young parent or single parent and can’t study full-time? What if they have a great full-time job and want to keep studying part-time? We’ve all seen these examples in families we know. The best results are usually obtained through having the money held in trust, and then granting flexibility to the trustee.

You should also give more than just a casual thought to the standard of treating all of your children or grandchildren equally. If your children are already in their 50s, you may have a good idea whether one may need more help than another, and you can determine whether that result is justified in your mind. When children or grandchildren are very young, however, or when you’re leaving money to children who haven’t yet been born at the time you sign your documents, you should consider the possibility that the children or grandchildren may have different financial needs as they grow up. Imagine the possibility that one child excels and has scholarship offers to great universities, while another child has a serious accident and needs special care and has special expenses just to get through the basic activities of daily living.

Estate planning attorneys deal with these issues on a regular basis and can help you through the different considerations to develop a thoughtful and caring plan for your loved ones. If you don’t have a plan, maybe you should put something in place now. If you’ve already established a plan, you should review it periodically and make sure that it still reflects what you want.