MODERN LOVE, a/k/a The Inlaws Have Arrived

               Second (and even third and fourth) marriages following a divorce.  Remarriage after the death of a spouse.  Couples who live together without getting married so they can keep their deceased spouse’s Social Security or retirement income.  Same-sex couples who cannot legally marry.  We all know someone who falls into one of these “Modern Love” categories.  What I’m referring to is any committed relationship other than a nuclear family represented by dad, mom, and their 2.3 children.  No matter how these Modern Love Birds found one another or why they have chosen the living arrangement that they have, estate planning in Modern Love relationships is very important.  The concerns may include such things as providing for your mate and also for children from a prior marriage, or providing for your care if you don’t have children.  Then there’s always the problem of greedy in-laws who swoop in when one Modern Love spouse dies thinking they are just going to take everything.

                Over the past several weeks, I have received a number of calls from clients who have Modern Love problems.  Not the kind Dear Abby addresses in her column.  These Modern Love problems go a little like this:

An older couple met and married late in life and both had enough money to be comfortable.  Over the past 20 years, they put both of their names on some but not all of their assets.  They each have grown children who get along, but don’t really know one another because they live all over the U.S.  Now the couple is getting older and they can no longer manage their affairs.  Who should be appointed to help them?  If you pick just one child from one side of the family, the other side worries about their parent’s needs not being addressed.  Do you choose someone from both sides of the family?  And how do you ensure they are carrying out the wishes of the couple, not their own personal agenda?   A tricky situation at best, and definitely time for a family meeting. 

Another senior couple married over 10 years ago, and they are both over 70.  In all of those years, they never revised their wills or trusts that were created long before they married.  Here again, both have adult children, and in this instance they want to make sure that everything they have goes to their respective families. 

Then the all-too-common story of the wealthy man failing in a nursing home and his estranged sister suddenly arrives on the scene and bilks the estate out of over $1.5 million while her brother is still alive.  The patient isn’t in any shape to fight his sister, but his intended heir learned of the sister’s actions and is pursuing criminal charges against the sister, filing suit to establish a guardian over the patient, and filing suit to recover the embezzled monies from the estranged sister. 

Unmarried couples are another special group.  One couple just wants to live together the rest of their lives without getting married because they can each continue to receive retirement benefits through their deceased spouses.  Another couple is in a same-sex relationship and cannot marry.  Since the laws of the state do not provide for inheritance by a non-spouse, both of these couples need an estate plan leaving their assets to their mate as though they were married. 

Other even more serious situations exist involving nasty in-laws who never come around until one Modern Love spouse dies.  It may be a nephew, a sister, or even a child, and all they want is whatever they can get.  If there’s no will or estate plan, the law may very well provide for them, leaving the surviving spouse to deal a hostile and sometimes tragic situation. 

By today’s standards, all of these clients really live fairly common lives.  So you see it doesn’t take much for an “uh-oh” situation to arise.  If you are in Modern Love or you love someone who is, I encourage you to take these issues to heart. 

For more information on estate planning and other legal needs, or if you have a legal question you would like for me to address, please visit my website at www.leflerlegal.com, email me at slefler@leflerlegal.com, or call me at 512-863-5658.  My office is located in Georgetown, Texas.

ANDY ROONEY & OTHER CELEBRITY PROBATES: Procrastination Landed Their Estates in Court

            I always enjoyed watching Andy Rooney’s closing commentary on the television show, “60 Minutes”.  That little touch of humor with a dash of sarcasm was a nice recipe for a lighter take on things.  Whether talking about such things as “wash and wear shirts that you can wash, but cannot wear”, or observing that “if dogs could talk, it would take a lot of the fun out of owning one”, for 33 years Mr. Rooney entertained audiences with his satire.  He died November 4, 2011, at the age of 92, just one month after delivering his last show. 

I remember his frequent opening line, “What’s all this talk anyway about . . . . ”  Paying homage to Andy Rooney, this week I’d like to ask, What’s all this talk about estate planning?

There’s nothing new about estate planning, per se.  It’s just that people eventually reach a point in time when they need it, so it’s an evergreen topic that comes up for every family.  For decades, only the wealthy elite used estate planning tools such as trusts and family partnerships as a way to accomplish tax goals and transfer wealth to later generations.  Less fortunate people had a simple will, if they had anything at all.  Over the past 25 to 30 years, however, not so wealthy individuals are also using trusts and estate plans as well to make disposition of their assets upon death and to plan for their own care during their lifetimes in the event an illness left them unable to care for themselves. 

But even with a topic as common as this, a surprising number of people either still haven’t done any form of estate planning, or what they have prepared isn’t standing up well in court.  Recent celebrity examples are Amy Winehouse and Michael Jackson.  Probate records show that Amy Winehouse died without a will and she amassed a fortune having an estimated worth of $6.7 million.  It is rumored that Winehouse still loved her ex-husband, despite his lengthy prison sentence for burglary related to his drug addiction.  But without a will, he gets nothing.  The same is true for her brother.  By law, the estate goes to Amy’s parents.  Michael Jackson, on the other hand, did prepare a will.  But he died $500 million in debt.  The executors now claim to have earned $475 million for the estate over the past 3 years and by law they are allowed to keep 10% of that as a fee.  The Jackson family is up in arms, filing claims against the executors and promising more claims to come.  So even with a will, there’s no apparent end to this estate battle in the foreseeable future.  A carefully drafted trust could have avoided all of that.

So when you are ready to take the plunge regarding your own estate plan, just know that there is no “one size fits all” and many documents are involved, including a trust, will, advance health care directive, and durable power of attorney, to mention a few, and each client’s unique circumstances should be reflected in their plan.  Beware of lawyers who try to fit every client’s estate plan into the same template. While some clients have very similar needs, estate planning just doesn’t work that way.  In more than one instance, I had clients who were charged terribly high fees by other lawyers only to receive nothing more than 75 pages of fairly useless boilerplate form language that had absolutely nothing to do with that particular client’s needs.  If you already have an estate plan, don’t forget to have it reviewed now and then, especially if you moved to Texas from another state.  Laws and document requirements vary from state to state. 

Andy Rooney, by the way, died with assets worth $9 million, and because he didn’t prepare a trust his will is being probated in the New York courts.  His estate will be divided among his four children after the court completes the probate and the lawyers take their nice big fee.  That’s one more thing about which I’m sure Andy would have had a few choice words.    

For more information on estate planning and other legal needs, or if you have a legal question you would like for me to address, please visit my website at www.leflerlegal.com, email me at slefler@leflerlegal.com, or call me at 512-863-5658 or 512-677-5LAW (-5529).  My office is located in Georgetown, Texas.

An Ounce of Prevention, a Legacy of Love

         Today I want to share with you the true story of Jim and CB and their estate plan.  It begins in 1991 when Jim turned 65 and retired from a successful sales career.  Their daughter happened to be a lawyer, and since Jim and CB were already busy taking care of other details related to retirement, their daughter insisted that they also prepare their estate plan.  So they did.  It’s not that they had a large estate, but what they did have was the result of a lifetime of hard work and they wanted to make sure they took care of what they had.

 

21 years passed.  In that time, Jim and CB bought and sold real estate, inherited a small interest in some producing mineral rights, added (and subtracted) in-laws, and celebrated the birth of five grandchildren and six great grandchildren.  But along the way CB discovered during a routine physical that sometime in her lifetime she had contracted a chronic disease that could not be cured; it could only be managed.   Doctors warned that CB had a long, tough road ahead of her, and they were right.  In the beginning, the symptoms were light or non-existent.  But in April 2012, her beautiful life came to an end, after spending the last 5 years under intense medical care and supervision. 

With CB now gone, the question for Jim became:  How sound was their estate plan? 

Fortunately, from time to time, Jim and CB took the time to review their plan with their daughter.  They amended their trust only on a couple of occasions as the need arose.  They saw to it that their children knew their wishes and they sought advice from others when needed.  Because CB and Jim took the time to prepare a good estate plan some 21 years before, the family was able to be together when CB died, taking their time to grieve together.  They weren’t distracted by any legal obligations they had to handle, because there was nothing to do.  The trust and related documents took care of those details and there was no probate to file. 

Unfortunately, this story represents the exception and not necessarily the rule.  Too many families do not plan ahead.  Then they feel lost when illness strikes, or when someone dies they have to hire an attorney to sort out and handle details for them.  Sometimes they have to file probate.  The majority of the probate actions I have filed in my career involved clients with feuding family members fighting for anything and everything they could get their hands on.  You may be thinking, “Oh, that would never happen in my family.”  You’d be surprised.  You can avoid that with an ounce of prevention.

 

I’m glad that my family sees the value in estate planning.  You see, CB (whose real name is Clarabelle) was my Mom.  She was a good ol’ Texas gal born in Kirby 77 years ago and raised in San Antonio.  She met and married a handsome war veteran and they celebrated 59 years of marriage together.  They took turns taking care of each other in life.  And through their estate plan, they took care of each other in death too.  This article is dedicated to Jim and Clarabelle Lefler, and is written with love and appreciation for them.  We all miss you, Mom.

For more information on estate planning and other legal needs, or if you have a legal question you would like for me to address, please visit my website at www.leflerlegal.com, email me at slefler@leflerlegal.com, or call me at 512-863-5658 or 512-677-5LAW (-5529).  My office is located in Georgetown, Texas.