The following is an overview of estate planning for retirees from ExxonMobil Corporation.
I've been fortunate to create, maintain, and oversee the estate legal programs for hundreds of ExxonMobil retirees. In addition, I was fortunate to inherit a few shares of Exxon stock when I was eight years old - from my grandmother.
While all ExxonMobil retirees are different, the "typical" ExxonMobil retiree is in his or her 60's, has worked at ExxonMobil for decades, and has a retirement account that is his largest financial asset.
The retiree either still has an ExxonMobil Savings Plan account, or has rolled it over into an Individual Retirement Account (IRA). Some ExxonMobil retirees take advantage of the Net Unrealized Apprecation (NUA) rules and have a brokerage account where they have transferred their employer stock out of their savings plan into a brokerage account. However, only a small percentage take advantage of this. Most retirees roll over their Savings Plan into an IRA.
In addition to the retirement account, the ExxonMobil retiree has other assets, such as a home, individual or joint brokerage account, vehicles, bank accounts, perhaps other real estate, such as rental property or family property, and perhaps they have their "toys," such as campers, RVs, boats, Harleys, Some retirees have no toys because it takes them a couple of years to get through their "Honey-Do" list.
The objectives of the ExxonMobil retiree often include having an estate legal program in place to keep things simple for themselves and their survivors, provide for their family the right way, be fair to all heirs, avoid tax, keep the government out of their estate, and in some circumstances, deal with nontraditional issues like blended families, children who can't handle a lump sum of money, or special needs children who are receiving valuable government assistance.
When it comes to plan design, we must address how to handle the distribution of the retirement account. This can be anything from simple to extremely complicated, particularly when retirement account owners name trusts as beneficiaries of retirement accounts. We need to keep an eye on the required distribution rules.
For the "probate" assets, we often create a revocable living trust (RLT) to avoid Succession/Probate both when the retiree passes away, and when the spouse of the retiree passes away. Real estate, brokerage accounts, and other probate assets get transferred to the RLT, and the RLT dictates the distribution of the assets after the death of the retiree and their spouse.
We'll have discussions about how assets are left to the spouse, and how assets are left to the children. We'll also address whether a bequest will be left to grandchildren, and, if so, how the grandchildren's inheritance will be managed for them while they are young.
The plan design component of the estate plan will also include conversations about who handles the retiree's money, and who makes the retiree's health care decisions in the even the retiree can't make those decisions on his or her own. We want to ensure that the court supervised Guardianship/Interdiction/Curatorship is avoided. We'll also discuss the life-support machines decisions.
No estate planning program for an ExxonMobil retiree is complete without a thorough discussion of the estate, income, and capital gains tax consequences of leaving assets to loved ones.
The, there will be miscellaneous things that will come up and be addressed, like putting people "on" the bank account and distribution of personal effects.
Once the plan is designed, our law firm then gets to work gathering family and asset information, and then customizing the various legal instruments necessary to make sure it is all in order.
After a review of these customized legal instruments, we'll get together for the execution of them, followed by titling/funding/beneficiary designation documentation, and organizing it all for easy access by yourself and others in your estate planning portfolio binder.
If you are an ExxonMobil employee or retiree, and you want to ensure that your estate is protected for yourself and your loved ones, give our office a call (225-329-2450, or toll free at 866-491-3884) to schedule an initial conversation with me. You and your loved ones will be glad you did - you've worked to hard NOT to protect what you have.
This post is for informational purposes only and does not provide legal advice. Please do not act or refrain from acting based on anything you read on this site. Using this site or communicating with Rabalais Estate Planning, LLC, through this site does not form an attorney/client relationship.
Louisiana Estate Planning Attorney
Phone: (225) 329-2450