Month: June 2017

Pros and Cons of Wills and Living Trusts | Harris County Will and Trust Lawyer

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As a Harris County will and trust lawyer, I realize that those of us in the estate planning industry often use technical language or “legal jargon” that is hard for most people to understand when setting out to get their affairs in order.  In fact, even the words “estate planning” can confuse people by making seem like you only need to plan if you have a large estate.  Not true!

There are other terms that you have probably heard along the way that can be equally confusing, as they are similar in theory, but different in execution. For example:

  • Estate planning versus Asset Protection
  • Healthcare Directive versus Advanced Directive versus Living Will
  • Power of Attorney versus Executor of an Estate

However, there are probably two estate planning terms that you will hear more than any other; trust and will.  These are key documents that do essentially the same thing, in theory. They both specify your last wishes and appoint someone to carry them out. However, there are reasons you would choose one over the other and sometimes you might choose both!

Hopefully we can help you understand the basic differences so that you have an idea of which legal tool (or combination of tools) would be best for you and your family.

Living Trusts

Pros

  • Ensures privacy, keeps your affairs out of the public record and helps you avoid probate.
  • If you own property in another state, a living trust may keep you out of that state’s probate court.
  • Some trusts offer protection from creditors, lawsuits and predators during your life.
  • You can designate a person who can take over management of your assets in case you are unable to function or incapacitated during your
  • You may not need to hire a lawyer when it comes time to distribute your assets.

Cons

  • A living trust can be more expense to set up initially.
  • You will also have to transfer ownership of all assets that are placed in the trust.
  • It can make it more complicated if you want to refinance property.
  • You cannot create a guardian for your children in a living trust. (However, you would be able to add a designation of guardian to supplement your trust that would take care of this.)

Wills

Pros

  • Setting up a will is less expensive and much simpler.
  • Creditors can only bring claims against your estate for a certain period of time.
  • You may name a guardian for your children.
  • You do not need to transfer any property.

Cons

  • After probate, your will becomes a matter of public record.
  • Probate can be take years to resolve and can be expensive.
  • A will does nothing for you while you are Your loved ones will be unable to manage or transfer assets using your will if you are incapacitated and/or unable to function.

There is quite a bit more to it, but this gives you an idea of the different techniques. If you really want a plan in place that will work when you need it, it is best to talk to a Harris County will and trust lawyer. Only an attorney that has had extensive experience can understand the nuances that could impact whether you have solid plan or simply a stack of paper that will not stand up in court. We help families throughout Houston gain the peace of mind that only comes with knowing your family will be okay no matter what. Call us today and mention that you read this blog and we will give you a free consultation so you can start the ball rolling on this important task.

Houston Estate Lawyer: 3 Talking Points to Help Your Reluctant Spouse Get Serious About Estate Planning

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Need help motivating your spouse to meet with a Houston Estate lawyer?  In my experience, I have found that the planning process is usually initiated by one spouse and is often met with hesitation by the other. It is understandable why one or both spouses would be reluctant to meet with an estate planner. Thinking about our death is scary, and many people will avoid any attempt to broach the subject.

Unfortunately, while we stick our heads in the sand, life continues to happen, and our need to create an estate plan does not lessen. But you know that, right? So, below I have laid out the top three excuses I hear, as well as a few quick talking points that you can use to help your spouse understand the necessity of planning for the future.

  1. “We have plenty of time to deal with this…” is the most common objection to creating an estate plan. Most people want to wait until later in life before creating an estate plan, but this is a mistake. As you know, tragedy can strike at any time. People also mistakenly believe that they only need an estate plan if they have a great fortune. Estate planning is much more than dividing your assets. With an estate plan, you can can ensure that there are guardians named who can care for your kids if you die while they are still young, or appoint someone you trust to make financial or medical decisions if you are incapacitated.
  1. “If something happens to me, you (the spouse) will inherit everything anyway…” is another common excuse you might hear to avoid creating an estate plan. While the spouse will inherit the majority of the estate, this is not a good reason for not creating an estate plan. What if something happens to both partners? If you have children, who do you want to raise your them if something happens? With an estate plan, you can make your wishes known and avoid long and costly custody battles for your loved ones. If you are on a second marriage, then you won’t inherit without a plan.
  1. If all else fails, you can remind your spouse that you, in fact, already have an estate plan. You have the default estate plan created by the state of Texas, and the state does not take any of your wishes into consideration. The process of settling one’s estate through the courts is long, expensive, and stressful for your loved ones. With an estate plan, this can all be avoided. Children of second marriages are usually disinherited.

There are many more advantages to be gained from creating an estate plan and absolutely no advantages for doing nothing. An estate lawyer in Houston will be able to create a plan that is right for you and will never pressure you to into doing anything before you are really ready. Call our office today to start this difficult, but necessary, conversation.

 

Trust Lawyer in Houston Answers, “What is a Trustee?”

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When you work with a trust lawyer in Houston to set up a trust, you will be asked to name a trustee. Before you can select someone for this important job, you need to fully understand the role and responsibilities this person will be given.

A trustee is the person who will manage the assets that are in your trust. Many people choose to be their own trustee and can continue to manage their affairs as normal. Married couples can be named co-trustees. In that case, when one dies, the other can continue to make financial decisions without any other legal steps needed.

You can also name a successor trustee. A successor trustee is the person who will take over your decision-making if you (or the co-trustee) are no longer able to do so. In some cases, several successor trustees are named in case the previous one is unable to serve. In other cases, people choose to select two or more adult children who will act together. Some people choose a completely unbiased corporate trustee, usually a bank or trust company, who will take over decision-making.

The following list contains some of the responsibilities that are required of a trustee:

  • Make decisions regarding assets in your trust. This typically involves managing the trust investments, property and making decisions that are in the best interest of the trust beneficiaries. Assets must also be managed according to the terms of the trust and governing law.
  • Keep detailed records for all of the trust transactions.  All transactions need to be accounted for by maintaining a record of receipts and other documentation.
  • Comply with all federal and state law requirements. It is critical that a trustee follows the terms of the trust documents and the trust creator’s instructions. Additionally, a trustee is responsible for complying with federal and state laws, meeting any reporting requirements, and filing federal and state taxes.

Administering a trust is often complicated and confusing. The trustee not only has to manage the details of the trust, they are also dealing with emotions and conflicts that can arise among the beneficiaries of the trust. That is why many trustees contact us to assist. We can help you avoid all of this by walking you through the entire trust administration process. Doing so will relieve you of tremendous stress and might help you avoid litigation brought on by unhappy beneficiaries.

Long-Term Care Insurance and Alternatives | Houston Elder Law Attorneys

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As Houston Elder Law Attorneys, we know that taking care of an aging relative can be emotional, time-consuming and expensive. Most people who have taken care of an aging relative can tell you there are many costs associated with long-term care that are often not considered. For example, you might need someone besides yourself to start helping with household and personal tasks and/or home health care.

As your loved one’s health declines, you may also have increased medical costs.  It is really best if you consider this in advance so that you can focus on your loved one’s emotional well-being, rather than being stressed about where money is going to come from. The good news is there are a few options for planning for this financial burden.

One option would be hybrid long-term care insurance. These policies combine the benefits of an annuity or life insurance agreement with a traditional long-term care contract. With hybrid policies, the consumer has the guarantee of long term care benefits or, if no care is needed, the promise of insurance benefits to themselves and their beneficiaries.

Another option that would offer income over the lifetime of the individual would be an annuity. Annuities offer security for a steady stream of income with a low amount of risk. Unlike other insurance option you do not have to prove insurability by completing an application with present or prior medical conditions. Many annuities also have long-term care riders which would waive any fees for certain conditions.

Lastly, many single-premium whole life insurance policies have an attached long-term care rider. These types of plans typically have a higher cost and may have a maximum figure that can be applied to long-term care benefits.

There are pros and cons to all of these choices. Selecting the right way to invest so that you are ready for long-term care is tricky, as there is no one-size-fits-all answer. That is why it is critical to talk to an experienced Houston elder attorney before you invest. He or she will consider all of the options above and have several other techniques that you may want to utilize to meet your needs.