Trusts and Estates Blog

Probate: Having a Will vs Not Having a Will

TaxmanDealing with the death of a loved one can be a difficult and painful process. The emotional roller coaster of dealing with death compounds the necessary process of settling the deceased’s estate. One aspect of settling an estate that should be avoided is probate.

Probate is the legal process of settling an estate in a probate court. If a person establishes a will before dying, the executor of the will presents the will to the probate court. The court then determines if the will is valid, listens to any objections to the will (should there be any), and orders the executor to appropriate possessions, lands, monies, and the contents of the will to the proper beneficiaries.

If a will has not been established, the estate is probated according to the law of the deceased’s state of residence and if any minor children are involved, the state determines the caretakers of the children.

The main difference between dying with a will and dying without one is the distribution of the estate. A person with a will has the say of who receives the contents of the estate. A person without a will has no say over the distribution of their estate, but the authority of the estate is given to a court to be distributed in accordance with state law. (Under both circumstances, however, you will not avoid probate.)

Each state differs in probate law, but most are not ideal in following the wishes of a deceased person. Unless a will has been established correctly under state law, the courts have no obligation to follow the deceased’s verbal or written wishes.

If you would like more information concerning probate, www.EstatePlanningSpecialists.com is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts (which allows you to avoid probate). Whether your estate planning goals are immediate or long-term, a California certified estate planning specialist will be able to counsel you on the best options available to you to meet your individual needs. Call us at (661) 945-5868.

Avoiding Retirement Planning Mistakes

seniors having teaI once ran into a retiree who had a considerable amount of wealth and lived very luxuriously. Over the course of our conversation it was discovered that he had spent his entire life working as a janitor of an elementary school. Floored, I asked the obvious, “How did you accumulate such worth in such a moderate career?” He replied, “I just started putting money into a retirement account when I first began work here, a little bit each paycheck.”

How do some people retire in such ease and others struggle to keep up with inflation after quitting work? Sadly, many people fall into some of the most common retirement planning mistakes as are listed below. Take note to these mistakes and be sure to avoid them so you can retire in ease.

Waiting until you’re 55. The number one retirement mistake people face is not beginning planning soon enough. Beginning early makes all the difference in the long run, for if begun early enough, your retirement total will not be as impacted by your immediate salary. Allowing time to compound your wealth will give you a more comfortable retirement.

Decide what percent is enough. Another common mistake people make in planning is assuming too small of a percentage of their yearly income. True, times are tough and money is not at a surplus currently, but if you make retirement planning a priority, your sacrifice now will pay off for years to come. Determining your percentage of investment depends on several factors. Consult a financial planner for help in setting a percentage to invest.

An undetermined goal. True, beginning early is key, but when you begin, take time to set a goal for your retirement total. This step will take strategic planning and help from someone in the business of retirement planning. Not only must you set a goal for a comfortable life after retirement, but you must assume inflation for such a time.

Using retirement monies now. With the downturn of the economy many people were forced to look to alternative means of income for a time. Many looked to retirement accounts and pulled monies saved for the future. If you can ever avoid it, don’t use the monies in your retirement account. Besides the fact you’ll need these monies in the future, often penalties and taxes are charged on monies removed from retirement accounts prematurely.

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

6 Steps for Helping Parents with Retirement Planning

Tree lined roadOne of the benefits of a struggling economy is the increased attention to retirement planning. Granted, some people will have a retirement plan in place early in life, but the average American isn’t fully prepared to retire into a life of comfort. As the child of an aging parent, it would be wise for you to sit down with your parents and discuss the specifics of their retirement plan. Here are a few questions to ask to help them as they plan for retirement.

Start Early. The sooner your start planning for retirement, the better. Even more so for your older parents, the time to talk to them about retirement planning is immediately. By age 50, you should have talked to them about their retirement plans, even if just in an informative manner. Even if your parents are retired, it’s not too late to have this conversation.

Know their Goals. Where do your parents want to live when they retire? Do they wish to travel often? Do they plan to move? Do they wish to begin any new hobbies or activities? Get an idea of where they envision themselves once retired so you can help determine their financial needs during retirement.

Determine Finances. You may not feel comfortable asking about your parents financial situation, but finances are important in determining how to plan for retirement. You need to know if they’ve saved enough to sustain their lifestyle during retirement. Remind them that they cannot survive solely on Social Security benefits alone (according to studies these only cover roughly 40% of retirement costs). They need more planning.

Check into Social Security. Although your parents can’t survive on Social Security benefits alone, knowing how much they will receive in benefits will factor into their financial retirement planning.

Early Retirement? Let your parents know that early retirement may be a possibility, especially if the industry in which they work is being hit hard by the economy. They may be able to avoid lay-offs or cut-backs by retiring early if their affairs are in order.

Discuss Health Care. One of the biggest expenses during retirement will be health care. Consider the medical history of your family, any diseases or disabilities your parents have, and factor in costs of doctors’ visits and existing medication. Also discuss their desires regarding health care facilities and assisted living homes.

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

Financial Planning for Retirement

stack of coins isolated on whiteMany Americans understand the importance of retirement planning and many begin such plans early in life through employer programs or other methods. But facing the task of figuring out just how much to set aside for a comfortable retirement can be a daunting problem.

There is no set amount that will allow all individuals to retire comfortably. Just as each person has individual needs and a certain comfort level of living, so each person’s amount needed for retirement will vary. Several factors are involved in the determining of your specific financial retirement needs. Also, length of life will factor into financial planning. Since the average life expectancy rate is increasing in North America, persons should plan for retirement to an average age of 90.

So how much should planners save for comfortable retirement? Many financial planners state that a good goal is fifteen times your current annual income. This amount should fund your most basic needs until the age of 90. If you plan on beginning new hobbies, traveling more often, or incurring new expenses during retirement, adjust your goal amount accordingly (roughly twenty-two times your annual income).

Many financial planners advise people to begin financial retirement planning in the 20’s and 30’s, yet it is never too late to begin saving for the future. The sooner you begin, the smaller the amount needs to be saved each month (and the better chance of reaching your retirement goal amount).

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

Family Legal Decision

WOK, but I have few important questions yet.hat happens when your loved one approaches the point that they can no longer function independently? While definitely a scary time for many, a few steps must be taken to ensure their legal affairs are in order.

The following are a few important points that must be discussed between you and family about the legal affairs of your aging loved one.

–Who will be in charge of managing your loved one’s personal affairs while they are still alive?

–Who will personally care for your loved one as they are unable to care for themselves? Will you pay for in-home care, appoint a loved one to be a caregiver, or choose a nursing care home at which they will live?

–How will you pay for long-term health care? Does your loved one have funds set aside for medical costs?

–Are your loved ones financial affairs in order? Be sure their assets are protected and their spouse will be properly cared for financially.

–Does your loved one have a will established? Reacquaint yourself with the specifics of their will and their wishes for the final days of their life.

This time can be overwhelming, so be sure to consult your family attorney or hire one immediately. If your loved one still has the legal capacity to make his or her own decisions, the number of planning options increases and an attorney can guide you through this process.

Sit down with your family and discuss the above questions to alleviate the stress of this transition period. Have a family meeting before meeting with an attorney so you are prepared with answers to questions the legal counsel may ask.

If you need help maneuvering through the many legal questions during this time in the life of your loved one, give our offices a call at 661-945-5868 and we will be happy to help answer any questions you have.

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

Conducting Elderly Parent Care Meetings

OK, but I have few important questions yet.As parents age, the difficult task of addressing elder care falls on adult children or other family and friends. Many children would love to seek advice from family members on the care of their parents, but maybe you’re like some families and have those couple extended family members who will want to get involved even if you don’t want them to. Nosy, overbearing, or opinionated family members can make the transition to elder care stressful on you. To deal with such loved ones, consider the following tips to making the transition as painless as possible.

Start Small. Begin meeting with only immediate family members. After you first seek the advice of those who know the situation best, then add extended family members, loved ones, or close family friends. Remember that the ultimate burden of this falls to you and those closest to you.

Choose a Quiet Spot. When meeting, be sure to eliminate background noises or distractions. Be sure everyone present can be clearly heard. Consider the seriousness of the task and choose an appropriate spot.

Be Thorough in Your Presentation. Come prepared with material about the move, information about the facilities available, and a list of pros and cons in the situation. Be sure everyone has a copy, and if possible, record the meeting for future reference.

Set Ground Rules. With many people comes many opinions. Before the meeting starts, set some ground rules such as only one person talking at a time. Encourage respectability and civility between those who might have strong differing opinions.

Stay Focused. Your ultimate goal is your loved ones well-being. Don’t lose sight of that fact amidst all the opinions. If needed, state early the purpose of the meeting such as “helping (loved one’s name) maintain independent living as long as possible” or “developing a plan of care for (loved one’s name)” or “planning for a facility based care for (loved one’s name).” Don’t waste time bringing up past hurts or current issues. The focus is on your elderly loved one.

Elevate Respect. Even if someone has a differing opinion, respect what they have to say. No matter your differences, others may have a unique view of the situation that will be helpful to the overall goal.

Create an Agenda. Pass out the agenda with the other printed information and refer to it if topics get off track. Use it as a guide to keep the meeting moving.

Identify a Secretary. Designate someone as the meeting’s note-taker to record the ideas stated. Be sure the person is thorough, and if at all possible, don’t take the notes yourself. You should be free to keep control of the meeting and guide the discussion.

Above all else, value the care of your loved one over any personal feelings or opinions. This meeting isn’t for you or another person to exert dominance, but for your loved one to receive the best possible care available.

If you would like more information concerning estate planning, contact Antelope Valley estate planning law firm Thompson | Von Tungeln (TVT) at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com. www.EstatePlanningSpecialists.com is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts. www.Medi-CalHelp.com is a comprehensive online resource for long term nursing home care for the middle class. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve clients with the creative, effective and custom solutions they demand.

How Securities Are Valued At Death

U.S. tax forms with glasses, pen, and calculatorEstate plans containing securities have specific rules that are best negotiated by a certified estate planning specialist. The federal government has specific rules for the valuation of securities and financial instruments included inside or outside of estate plans. Since there are a vast number of financial instruments available in the market, this article will focus on the more common instruments included in estate plans which include stocks, bonds, mutual funds, Treasury securities, cash and cash-equivalent accounts and retirement accounts.

The federal rules for valuation are:
Stocks, bonds and mutual funds – for stocks, it is the average of the trading range on the date of death, or in the event of a weekend or holiday, the average of the preceding and following trading days. Bonds are priced by averaging the closing price on the date of death and the preceding trading day, and must include any accrued interest. U.S. Savings Bonds are valued at their redemption value at the end of the month, according to the redemption value published by the U.S. government. U.S. Treasury notes and bonds are valued the same as commercial bonds. U.S. Treasury bills are valued at their redemption price, since interest in included in their price.
Cash, bank, and credit union accounts – All cash and cash-equivalent accounts must report the exact value on the date of death. Any uncleared checks must be listed separately so their value can be deducted from the account.
Retirement accounts – including IRA’s, pension, 401(k) and similar retirement accounts must account for the value on the date of death. Any stock, bonds or mutual funds will be valued using the rules mentioned above.

Proper recordkeeping of all of the investments in your estate plan will make the valuation process much easier for your estate planning attorney and loved ones. Keeping meticulous records with your estate planning documents will enable them to efficiently value your assets and avoid any unnecessary investigation that will be subtracted from your estate value.

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

Move Quickly on Very Long Term Dynasty Trusts

file system - focus on the taxation sectionFor years now wealthy people have used dynasty trusts to shield their assets from estate taxes for tens and hundreds of years, or even forever. But the dynasty trust is under attack from a new piece of legislations in President Obama’s 2012 budget. The bill would limit tax-free dynasty trusts to a maximum of ninety years. While experts say the bill has little to no chance of passing this year, the fact that its shown up is reason enough for investors and those seeking to transfer wealth to act quickly on establishing dynasty trusts as the bill will not be retroactive.

Besides the short time span before a bill limiting the effectiveness of the dynasty trust is signed, several positive reasons exist for establishing such a fund. The dynasty trust contains a generous terms on the state and gift tax—a $5 million individual exemption and a top 35% rate (both of which will expire after 2012).

Since a tax overhaul in 1986, many people have begun using dynasty taxes to transfer funds without penalty. For example, a man who wishes to leave money to his children, grandchildren, and great grandchildren would leave the money in a Dynasty Trust to his children and the trust would be rolled on to the next generation without estate taxes until it reached its final recipient. Without using a Dynasty Trust, each generation would amass an estate tax to be paid. Rather than losing wealth on taxes, this man could place his entire estate into a Dynasty Trust and avoid the many layers of taxes. In essence, heirs don’t have to spend their inheritance on estate taxes.

The Obama administration proposal would remove the federal estate tax exemption after ninety years so the trust can go on indefinitely but the tax exemption cannot. Because allowing such a trust affects many current state tax laws, only the following states allow dynasty trusts: Alaska, Delaware, District of Columbia, Idaho, Illinois, Kentucky, Maine, Maryland, Michigan, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, North Carolina, Ohio, Pennsylvania, Rhode Island, South Dakota, Tennessee, Utah, Virginia, Wisconsin, and Wyoming.

Again, while the bill should not be passed this go-around according to experts, the fact dynasty trusts are being targeted is a good reason for those wanting to roll inheritance monies on to many generations to establish a trust as soon as possible.

Antelope Valley estate planning law firm Thompson | Von Tungeln, A P.C. (TVT) offers sophisticated estate planning and administration for the affluent, discriminating client. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com.

Easing into Elder Care

Elderly hands holding adult handsElder care is a giant step for most families who go through the transition of an older loved one living on their own to living with assistance. Some transition well, yet others can become discouraged by the lack of complete freedom. To ease your loved one into elder care (and to reduce the burden on yourself as well) consider these three steps to take as you make the transition.

Ask for help. If you are becoming the primary carer for a parent or loved one, seek help from other friends, family, or those who’ve gone through the process. You don’t have to be the only one caring for your loved one. Others can help with certain tasks or providing relief for you once a week or so. Be sure to value your own health and freedom by seeking help from others.

Encourage social activities. Many communities have provided seniors with social activities to connect them with other older people and to help them maintain social interaction. Whether through a community center, a church, an independent group, or a retirement home, check into activities your loved one can partake in to keep their spirits high. Also, organize family game nights or other personal activities that will keep them connected with family as well as those their age.

Communicate with doctors. Doctors, nurses, caregivers, and other medical personnel are a vital part of your loved one’s life. If possible, accompany your loved one on doctors’ visits and speak with the doctor about your loved one’s health. Be willing to help with new medication, watch for side effects, better care for illnesses, and be an extension of the doctor in your home. As you stay current with their overall health, you’ll be able to better help them live in ease.

Remember that you and your loved one are both transitioning in this time. You are caring for others, but also will be forced to take better care of yourself. Plan time for yourself and get others involved so the burden doesn’t fall squarely on you. Also, make the needs of your loved one a priority in your life. Keep their spirits high by keeping them involved with the outside world. Also be a help to their doctor by being actively involved in their medical health.

Transitioning to full-time (or even part-time) care of an aging loved one comes with its challenges, but the benefits of spending time with someone you love and gleaning from their life wisdom is an invaluable opportunity to have.

If you would like more information concerning Elder Care or any other aspect of estate planning, contact Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) at 661-945-5868 or visit their websites at www.EstatePlanningSpecialists.com and www.Medi-CalHelp.com. www.EstatePlanningSpecialists.com is a comprehensive online resource for personal wealth management solutions through wills and revocable trusts. www.Medi-CalHelp.com is a comprehensive online resource for long term nursing home care for the middle class. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve clients with the creative, effective and custom solutions they demand.

Antelope Valley estate planning law firm Thompson Von Tungeln is offering a March 4, 2011 seminar on Medi-Cal for Long Term Care and how to access this benefit without spending everything

Elderly hands holding adult handsAntelope Valley estate planning law firm Thompson Von Tungeln is offering a complimentary seminar on the Myths about Medi-Cal program and how those myths can affect long-term care planning.

“Long-term care planning is an intricate process,” said Kevin Von Tungeln, partner at Thompson Von Tungeln. “Compliance with Medi-Cal is akin to a chess games with draconian penalties if you make a mistake. That is why consumers need to be informed about Medi-Cal and have expert legal counsel guiding them through the process.”

The recent changes to Medi-Cal, the California Medicaid program, center on the ability to give away assets such as a home or financial instruments, and changes regarding annuities. Many individuals have established planning strategies to give away assets that will need adjusting.

“Anyone living today has a greater than 50 percent chance of needing long-term care when he or she reaches age 65,” said Von Tungeln. “At least 70 percent of persons over 65 will require long-term care at some point in their lives. Being knowledgeable about the new rules and planning accordingly can save you, your spouse and your heirs a great deal of trouble in the future.”

The seminar is on Thursday, March 4, 2011 at the Hellenic Center in Lancaster – 43404 30th Street West (30th St West and Ave K-4) Lancaster, CA 93536. Registration is requested due to limited seating. To register for the complimentary seminar, call 661.945.5868

About Kevin Von Tungeln

With more than 20 years’ legal experience, Kevin L. Von Tungeln serves Thompson Von Tungeln in the areas of estate planning, probate, trusts, wills, trust administration, conservatorships, guardianships and elder law. He is certified by the State Bar of California Board of Legal Specialists as a Board Certified Specialist in Estate Planning. Get to know more about Kevin’s approach to estate planning by viewing his informational videos at: www.youtube.com/user/EstateLawyers. Kevin can also be found at LinkedIn by going to: (www.linkedin.com/in/kevinvontungeln)

About Thompson Von Tungeln

Antelope Valley estate planning law firm Thompson Von Tungeln (TVT) offers Medi-Cal and VA Pension benefit planning planning and administration for the middle class. As Board Certified Specialists in Estate Planning, Trusts and Probate as certified by the State Bar of California Board of Legal Specialization, partners Mark E. Thompson and Kevin L. Von Tungeln are expertly equipped to serve these clients with the creative, effective and custom solutions they demand. For more information, contact TVT at 661-945-5868 or visit their websites at www.Medi-CalHelp.com and www.EstatePlanningSpecialists.com.

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