What is a Special Needs Trust and Do You Need One?
Any parent or spouse who knows that their child or other beneficiary has special needs that will require them to avail themselves to governmental programs (like Maine Care) in the future will want to consider a Supplemental Needs (also known as Special Needs) Trust in their Estate Planning. A Supplemental Needs Trust is specifically designed to ensure that the beneficiary will not be deemed to have inherited assets that could potentially disqualify them for the program they are on. This can be especially important for children who have extreme medical needs and cannot afford to lose that funding. A Supplemental Needs Trust will protect the money so it will be there for the needs of the child/grandchild/beneficiary. It is a very restrictive trust that must last for the rest of that beneficiary’s life. This requires special care when choosing a Trustee and Successor Trustee to oversee the trust. If you think this may apply to your family situation don’t hesitate to call and learn more.
– Kathryn Bedell, Esq.
Is your Trust Fully Funded?
Many of my clients come to me with Trusts that have not been funded or fully funded. What does that mean? It means they had a trust document drawn up by their lawyer in the past, but everything they own is not in the trust. Their house is not in the trust, bank and stock accounts, etc. are not in the trust. They likely did the trust to avoid probate and in fact will not only have probate, but will also have to deal with the trust, who is likely the beneficiary in the Will. What should you do to prevent this? Check out my Determining Your Net Worth hand out and make sure that everything on that worksheet is either in your trust or has beneficiaries (IRA’s, 401Ks cannot be in the trust). Is the house in the trust? Are the timeshares in the trust? What about the cars? In order to have that seamless transition you are expecting when you pass you need to make sure EVERYTHING you own has been included. It doesn’t matter how big or small that account is. The details matter. Learn more about trusts in my hand out – Trusts are they Right for Me?
– Kathryn Bedell, Esq.
BUYER BEWARE – On-line Estate Planning Documents
In these uncertain times Estate Planning (Wills, Trusts, Powers of Attorney, Advance Health Care Directives) is on everyone’s minds. Many people use on-line services to generate basic forms. Unfortunately, those documents are often cut and paste, and can often have wrong information. Maine, for example, just passed a sweeping change to it’s Probate Code in September, and many on-line national programs have not caught up yet.
The Estate Planning Process is so much more complex than drafting a few forms. One of the most critical elements of the Estate Planning process is reviewing a client’s assets and making sure they are all titled properly. No on-line program can do this.
Working with an attorney is not as expensive as one might think. At Ballou and Bedell the entire process for a single person is $475 and $775 for a married couple. We offer a generous discount (25%) for any young families with minor children. These documents, if done well, can potentially last you the rest of your life, depending on your age. Don’t be penny wise and pound foolish.
Call us today and put your mind at rest.
– Kathryn Bedell, Esq.
Timeshares: Lots of fun until you die…
If you have not properly planned, timeshares can inadvertently saddle your loved ones with headaches and needless expenses when you die. Few people realize that most timeshares are deeded real property, even if it is only a week in Sedona or two weeks in Hawaii. If you own the timeshare jointly with someone (e.g., a spouse or friend), you may be fine. But what if you and your spouse die in a common accident? Or your spouse has passed and you now own it yourself alone? Owning real property subjects you to a probate in that state when you die. If you do own a timeshare, make sure you have thought about succession planning. Some options are to place the timeshare in a trust, or to add a child or friend you wish to inherit your timeshare deed before you die (assuming they are willing to take on the annual expense after you are gone). Otherwise, you may end up costing your family far more money dealing with the timeshare than it is actually worth, not to mention the added stress!
-Kathryn Bedell, Esq.
Who should I choose as my Personal Representative or Trustee?
Whether you have a will-based estate plan or trust-based one choosing the right person who will be in charge of your assets when you are gone is sometimes a difficult decision for people. Gone are the days when the oldest son is automatically chosen. I’ve seen too many family fights occur simply because the wrong person is serving in this position. You know your family and its particular politics best.
Blended families may want to utilize Co-Personal Representatives so that a child from each side is represented. In some situations it is necessary to go to a neutral third party, like a neighbor, sibling, or professional. Things to consider when choosing:
- Are they fair?
- Are they good communicators?
- Are they able to take criticism and not let it bother them?
Worry less about who is “local” and more about who you truly trust to get the job done. Always remember to have plenty of contingency planning in case someone you choose dies, gets sick, or just doesn’t want to do it.
Choose wisely and you will minimize family discord after you pass.
-Kathryn Bedell, Esq.