Estate Planning Goals

Advice to Husbands Whose Wives Don't Handle the Money

One of the most important things you can do to enrich the lives and relationships of those you leave behind is to make sure all of your estate affairs are in order - and I'm not even talking about your estate legal documents. Sure, having all your estate legal documents in order is an important component to leaving a legacy (and not a headache) to your family, but here are five OTHER MATTERS that our best clients do for their loved ones to ensure a peaceful, stress-free, harmonious estate settlement:

1.    Funeral and Burial Instructions. If you've had your estate planning legal affairs documented by our law firm in the last 25 years, you received an Estate Planning Portfolio containing numerous sections. One of those sections includes your customized Burial and Funeral Instructions. Countless people have revealed their heart-felt wishes regarding their burials to me, but it really doesn't do much good to tell ME what you want, because I'm not likely to be the one handling your funeral arrangements. Document your detailed wishes in the appropriate section of your Estate Planning Portfolio. Your family will thank you for it and they'll brag about you to others.

2.    List Your Closest Family Members and Friends. There's a section in your Estate Planning Portfolio that we assemble for our clients where you can list the names, addresses, and telephone numbers of your closest family members and friends. Don't leave your family with the job of having to track down the contact information for those dozens of people who need notification. Do this work ahead of time and keep it up to date.

3.    Instructions to Your Executor / Successor Trustee. If you've worked with us and you have your Estate Planning Portfolio, there's a section in your Portfolio which has detailed instructions for the person that you designated to handle your legal, tax, and financial affairs when you are gone. You simply need to let that person know of the existence and location of your customized Estate Planning Portfolio, and they'll be able to flip through to the section that contains their instructions on what to do to get the job done.

4.    Organized Asset Information. You can have the most superior set of estate legal documents customized for your family, but if your surviving wife or other surviving family members do not have detailed records of what you own and what you owe, you will leave them with a frustrating, never-ending headache.  This will delay your estate settlement because no one will ever know if there is another account or asset that will be uncovered at a later date that will cause all of your heirs to drudge through more settlement paperwork. In a Rabalais Estate Planning Portfolio there is a section that includes the assets you own which will take the "guesswork" out of your estate settlement.

5.    Your Estate Planning Letter to Your Heirs. Included in a Rabalais Estate Planning Portfolio, you can communicate your wishes to your family regarding your desired distribution of personal effects, such as guns, jewelry, furniture, and other personal non-titled items. For some, making sure the personal effects wind up in the right hands is more important than the division of funds. Plus, it's easy to divide $1,000,000 among four children, but many families have been torn apart because of a fight over personal effects which had far less fair market value than other estate assets, but FAR MORE SENTIMENTAL VALUE than a bank account or investment portfolio. So take a few moments to describe your wishes and your feelings to your surviving wife, husband, children, or other loved ones. It will be your final message to them.

If you left your lawyer's office with your estate legal documents folded up in an envelope - without an organized set of supporting documents, you've missed the boat. Sure - having a superior, customized set of estate planning legal documents is critical to easing the process of settling your legal affairs, but having all of the above supporting letters, records, and instructions for those you leave behind can be the key to leaving a legacy.

The Two Secrets to Bill Gates Completely Avoiding Estate Tax

It's no secret that Bill Gates is one of the wealthiest people on the planet. You would think that the IRS will mop up when he dies, collecting billions in estate tax to be redistributed in whatever way our government distributes it - that's another story.

While Mr. Gates has not yet contacted me to customize his estate legal documents, there is little doubt that he will take advantage of two "often little known" tax rules to minimize or completely avoid federal estate tax. While I'm sure Bill has several trusts to avoid probate and make things simple, here are the two tax rules that Bill will take advantage of:

1.    The Unlimited Marital Deduction. If Bill dies before his wife, Melinda, he will leave his estate in a way so that $0 estate tax will be paid when Bill dies. You can leave an unlimited amount of assets to your surviving spouse when you die, and no estate tax will be due (the idea is that the tax is due after the surviving spouse dies);

2.    The Estate Tax Charitable Deduction. After both Bill and Melinda die, they will leave the bulk of their estate to the Bill & Melinda Gates Foundation. Anything you leave at your death to a charity escapes the federal estate tax.

Voila! No estate tax. The richest man in the world will take advantage of two often misunderstood tax principles to avoid a tax that is specifically designed to tax the rich.

When Bill calls, I'm sure we'll have a discussion about this. Moral of this story? Make sure you take the necessary actions to protect your estate from the government. Be like Bill!

 

Don't Just Sit There! Resolve Your Estate Planning Concerns Today

    I was working with a really nice family recently out of Baton Rouge. The husband and wife came into the office to visit with me, as well as their daughter. They were referred by their financial advisor who also works out of Baton Rouge.  That financial advisor has a really good, trusting relationship with me and I’m fortunate that he entrusts his clients with me and our legal services. Nonetheless, the father was real clear about what their estate planning goals were. He said their main concern was to make sure they maintained their worth. Number two, they wanted to make sure there would be a fair distribution of their assets to their children when they pass away. And, number three, they wanted to minimize taxes.

     So, we started talking about those things and you know, I thought to myself, he didn't bring up anything about potentially losing his assets if there was a nursing home situation. So, I brought it up and he said, “You know what? That's not something we've given a lot of thought to. It’s not something we've talked a lot about. Our plan is to stay out of the nursing home, but you never know.  If our family can’t take care of us, we might have to go into a nursing home.  So, protecting ourselves from that fits right in with our number one goal, which is maintaining our worth.”

    They own a home and a couple of pieces of rental property, and they quickly learned that if there was a nursing home situation, they would have to sell all of their rental property and use all of the proceeds to pay for those nursing home expenses -- many thousands of dollars a month. So, they were real pleased and eager to get started on setting up a plan where they could arrange things so that no additional income tax would be due.  There's not going to be any estate tax when they pass away.  Everything's going to be arranged so that if in the future, there is a nursing home situation, that rental property and their life savings will be protected. They felt good about that. We started immediately and they are well on their way to having everything in order.  So, if that's a concern of yours, the most important thing is addressing this ahead of time.  If you'd like to have a conversation with us, feel free to let us know.