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Melbourne Florida Estate Planning Law Blog

Estate planning can give loved ones peace of mind

Many people in Florida may put off thinking about estate planning, but preparing these key documents can be critical in helping to provide peace of mind to a person's loved ones in the future. People can act to ensure that their wishes are carried out after they pass away as well as putting in place safeguards to respect their financial and healthcare decisions if they are incapacitated.

In many cases, people think of a will when they think about estate planning. A will is an important document to distribute property held in one person's name, but it is also important to think about other kinds of property transfers. For example, joint accounts will go to the other person named on the account. Life insurance policies, retirement accounts and other funds will go to the named beneficiary, so it can be particularly important to ensure that this information is accurate and updated. People often delay making out a will, viewing it as a task they will take on when older. However, creating a will now can help to assure that matters are cared for in case of an unexpected event.

High interest rates influence trust planning strategies

Interest rates are expected to increase for the near future in Florida and throughout the U.S. After a decade of consistently low interest rates, the market conditions now signal a change for financial advisors. Advisors must recognize the new era that they are in and tailor their trust planning advice accordingly. Since the environment is right for trust planning, reviewing grantor retained annuity trusts and charitable lead annuity trusts is recommended.

In a GRAT, the trust is combined with the annuity. The trust is set up for a specified number of years. Each year, it pays the grantor a certain amount annually. In addition, the named beneficiaries receive a portion of the estate. The fair market value of the property being transferred into the GRAT is based off the current market value of the property named in the GRAT less the retained interest. Interest is calculated using the annuity stream retained over the life of the GRAT.

Changing an estate plan during divorce

People in Florida who file for divorce may be overwhelmed by all of the emotional, practical and financial changes in their lives. At the same time, however, there are key tasks that can be important to address as quickly as possible in order to protect themselves and their finances from unwanted consequences, especially while the divorce is still pending. One of the most important avenues that can be critical to explore, even while the divorce is not yet final, is updating an estate plan.

There are some kinds of changes that cannot be made until a divorce is finalized. For example, people cannot change the beneficiaries of their life insurance policies, retirement funds, investment accounts, pensions or similar accounts until the decree is issued. However, these can be some of the most important accounts to address immediately after the divorce is final. There have been many lawsuits and family disputes over the years sparked by a failure to update insurance policies and other accounts, even years after a divorce.

Using professionals for estate planning

Florida residents may not think twice about seeking out professional assistance when they are sick. The same principle should apply to estate planning. Using professionals when creating an estate plan can help reduce the likelihood that there will be complications with a person's estate after they die.

An estate planner can be just one part of a team of professionals a person can use to take care of their estate affairs. The team may include a CPA or accountant, a financial adviser and an estate planning attorney.

How Medicaid and Veteran’s A & A can work to your benefit

If you are a senior citizen and a military veteran, you may be interested in obtaining government help for your health care needs.

Perhaps you are thinking in terms of Medicaid, but the Aid and Attendance program for veterans is also available. These programs address different goals, and you must consider certain factors when you apply.

Don't forget the house when creating an estate plan

A home can be a Florida resident's biggest asset. Therefore, it is worth including in an estate plan. Doing so can prevent a potential source of family infighting after a homeowner passes on. What is done with the home after the current owner passes depends on a variety of factors. For instance, potential heirs may not want to pay taxes, insurance and maintenance costs.

It is also important to consider whether there is an outstanding mortgage to contend with. If a potential heir doesn't have enough money to cover those expenses, it may be best to plan on liquidating the property. However, even if the property is liquidated, it's important to determine how the proceeds from the sale will be split. Selling the home may also be the ideal solution if the children can't make up their minds as to how to account for it.

What a pour-over will can accomplish

A pour-over will can provide a convenient way for a Florida estate owner to ensure that assets find their way into a trust after they pass. The document states that any assets that haven't been put into the trust are to be placed there upon the grantor's death. It is important to note that a will itself is subject to probate even though a living trust is not.

Furthermore, assets only go into the trust if there is no other designated beneficiary. If a person fails to properly title assets, intestacy laws could determine who gets property left in an estate. Generally speaking, spouses and children tend to inherit most property if an estate owner doesn't have a will or trust properly created prior to death. Therefore, siblings, cousins or other intended beneficiaries could receive nothing if the necessary estate plan tools are not used correctly.

Understanding changes to military retirement

Military retirees in Florida may find themselves confused by the veterans' benefits system, especially the changes to the retirement system that took place on January 1, 2018. The new system is known as the Blended Retirement System because it brings together two types of retirement income, annuities for people who retire after 20 years of service and income from the Thrift Savings Plan or TSP. The TSP is a government-run 401(k) retirement account that allows people to invest their own savings in stocks as well as receive an employer contribution.

The new system changes the annuity formula currently used for veterans' benefits, which is based on 36 months of basic pay at their highest, multiplied by 2.5 percent of their years of service. Under the blended system, the multiplier used is 2 percent instead. However, the offset is made up by government contributions to the TSP. Each month, the government will automatically contribute 1 percent of their basic pay, and the member of the military will be enrolled for a 3 percent contribution. The government will begin to match contributions up to 5 percent after two years of service.

Steps for successful estate planning

Florida residents who have accumulated a lot of assets will want to create an estate plan that can help sustain wealth throughout future generations. While this may be a common goal, in reality, wealth is rarely sustained past the children. However, there are steps that can be taken to safeguard one's estate so that the goals for the assets are achieved.

The first step is to address is how the estate should be divided. Funds can be divided equally, fairly or in an equitable manner. Estate owners generally have a difficult time dividing their assets because each heir may have a different level of capacity for being responsible as well as different talents or prospects for the future.

Estate planning answers important end-of-life questions

Estate planning tools do provide solutions for elderly people who have some significant assets they want to leave to their heirs. However, the idea that end-of-life matters are unique to seniors is a misconception. If you are 18 years old or older, you should have some sort of estate plan.

Why? Even if you are young and broke, you should think about what will happen to you and your assets if a tragedy occurs. Here are some reasons you should start estate planning immediately.

Consult Our Florida Lawyer for Veterans Aid & Attendance

Feel free to contact us and schedule an initial consultation where we can review your circumstances in an intimate setting and discuss how our Brevard County Elder lawyer can help you. Simply call Amy B. Van Fossen, P.A., locally at 321-426-1848 or toll free at 800-495-9153. We look forward to meeting you.

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