Houston Estate Planning and Elder Law Attorney Blog

Can Houston Baby Boomers Re-Write the Rules for Retirement?

Published on: September 18, 2014 | By McCulloch & Miller, PLLC

As the Boomer Generation continues to re-write the rules, the call for redefining "retirement" is growing louder each year. Our parents referred to their retirement years as "The Golden Years." However, our generation demands a completely new definition for "retirement." We're not happy with a word that shares a meaning with end-sound words like "depart," "relinquish," or "surrender." And "Encore Generation" sounds a bit too much like Madison Avenue for our generation. Some thought leaders are coining new terms such as "recreationist," as in recreating a new life. While a new term hasn't quite caught on for this wave of older adults, some linguists are batting around new terms such as "eldering" in hopes of defining the Boomer's next transition.

The "how's" and "what's" of transitions appear in many forms. A basic question is how does one really plan for thirty years of "retirement?" Do you remember what you were doing thirty years ago? Can you picture what you will be doing thirty years from today?

It used to be you retired at 65 and died at 66. Now, healthy 65-year old men can reasonably expect to live until they are 85, according to Age Tables provided by the U.S. Social Security Administration. A couple where one spouse is 65 today, can expect that one surviving spouse will live into their 90s.

Houston: Do You Know If Digital Assets Die With You?

Published on: September 17, 2014 | By McCulloch & Miller, PLLC

Death is emotionally difficult enough without discovering that you have no idea what digital assets a person had or what they wanted done with them.

A growing concern among those wishing to properly manage their digital estate is "digital death," which questions what is an asset or special relationship—and how to balance privacy and security with passing on relevant information. A recent Smart Company article, titled "The business of digital life and death," reports that 70% of 65-74 year-old Americans are on Facebook, and there are 30 million accounts that belong to individuals no longer alive. The article cites several factors in dealing with digital assets. For example, there are no international standards on digital assets or for how to address them via estate planning.

Again, social media has not been a burning issue in estate planning as of yet; however, as younger generations start to look at planning for the future, it will become more relevant as it will be more common and because the legal treatment of digital assets after death is clearly defined.

Plan Now for the “What Ifs” of Life in Houston

Published on: September 16, 2014 | By McCulloch & Miller, PLLC

The most important thing for any patient with a long-term illness is to focus on his overall health and mental outlook. Having financial plans in place allows a patient to set other worries aside.

How do you plan for future illnesses or tragedies? The "what ifs" of life are all too real, so get your financial plans in place ahead of time.

Life Insurance is extremely important if you have young children who depend on your income. A recent Time article, titled "When Tragedy Strikes a Young Family," suggests a 20- to 30-year level term policy as a good start to help support your family through the children’s school years. Another often overlooked part of this type of planning is Disability Insurance. As many people have discovered, being unable to go to work due to an injury or sickness can be more financially catastrophic than death. Expenses typically increase with treatment and recovery, but your income stops. A disability policy either through your employer or through a private insurer can be a real wise move and offers a good deal of protection—it provides a portion of your income while you are unable to work.

Hollywood Couple’s May-December Marriage Sheds Light on Estate Planning Challenges

Published on: September 15, 2014 | By McCulloch & Miller, PLLC

Lauren Bacall's loss of husband Humphrey Bogart when her children were young does point to some of the issues surviving spouses face when there is a difference of age of 20 years or more. Of course, May-December marriages don't only happen in Hollywood, and the resources and circumstances can be very different.

Lauren Bacall lost husband Humphrey Bogart when her children were young. When interviewed by Vanity Fair in 2011, she considered herself lucky to be married to Humphrey Bogart, benefitting greatly from his knowledge of Hollywood. Bacall was 25 years younger than Bogart, but she didn't mind the age difference at all. However, losing her husband emphasizes the issues surviving spouses face when there is a significant age difference in the couple— in Hollywood or otherwise.

In May-December marriages, there is a strong possibility one spouse will survive the other by many years. Typically it is an older man and a younger woman, although vice versa as well. Since women generally live longer than men, when it is the husband who is the older spouse, the estate planning issues are even more critical. A young mother with children can be placed in a very tenuous position if she has stopped working to raise the family and the husband passes away. A young mom needs a financial plan that contemplates this situation.

Houston Boomers – Beware of These Estate Planning Blunders

Published on: September 12, 2014 | By McCulloch & Miller, PLLC

David Cutner, partner at Lamson & Cutner, attorneys for the elderly and disabled offered the following tips for both estate planning and long-term care for boomers.

A recent Fox Business article reported that the majority of seniors are completely in the dark on one of the biggest financial risks they are facing. The article, titled "Estate Planning Mistakes Every Boomer Should Avoid," sheds some light on the catastrophic costs of long-term care.

According to the U.S. Department of Health, 70% of the U.S. population over age 65 will require long-term care, and over 40% will need nursing home care for some period of time. Most people do not have insurance coverage for this risk and believe inaccurately that Medicare covers their long-term care. That is just not the case, and without planning, if care is needed, life savings are quickly wiped out. Fortunately, there are solutions that will protect an individual's assets and income, and at the same allow access to Medicaid benefits. An experienced elder law attorney will have the knowledge and background to provide you with needed advice and the skills to design a strategy that will achieve your goals. A well-drafted estate plan is a wise investment to ensure that your assets are passed to your beneficiaries efficiently—in a manner that avoids conflicts among your heirs and that minimizes costs.

Houston Scam Alert! Don’t Fall Victim to Estate Planning Cons

Published on: September 11, 2014 | By McCulloch & Miller, PLLC

Constantly in the news, it seems like there is a new scam making headlines. One surprising area in which scams are becoming more common is estate planning. Each year, more people fall victim to unscrupulous and unqualified sellers of ineffective estate planning documents. Often, these scammers are door-to-door salesmen or telemarketers.

Estate planning is a very personal and essential process to protect your loved ones and your assets. And all it takes is a scammer to mess that all up. A recent Webwire article, titled "How to Avoid an Estate Planning Scam," points out things to keep in mind when considering your estate planning options.

Employ a qualified estate planning attorney. Do-It-Yourself is very popular these days, from home improvement to filing income taxes. There are many websites that offer DIY wills. Beware! Estate planning is not a point-and-click or fill-in-the-blank proposition: it is a complex area of law with different rules depending on where you reside. Use a licensed, experienced estate planning attorney to prepare your estate plan. Check with the state bar and make sure he or she is licensed to practice law in your state.

Yes, Houston. You Really Do Need a Will

Published on: September 10, 2014 | By McCulloch & Miller, PLLC

If for no other reason, you need a will to name an executor (or executrix).

So, do you really need a will? Yes. Really.

A recent Forbes article titled "Do I Really Need a Will?" recommends that you should have a will to at least designate an executor or executrix to administer your estate. This individual will be responsible for taking care of your affairs after you pass away. Without a will, the probate court will appoint an administrator—this could end up being almost anyone. Anyone with a decent reason has the ability to petition the court to be appointed—like your cousin Reggie (who you last saw at your fourth birthday party) or your Uncle Ted (who is always dressed like it is 40 below, even in July).

Fundamental To-Do’s For Houston Families When Loved Ones Pass Away

Published on: September 9, 2014 | By McCulloch & Miller, PLLC

Losing a loved one is a difficult experience. Yet, during this time, you must complete a variety of tasks and make important financial decisions. The following checklist may help guide you through the matters that must be attended to.

If you have lost someone you love, it's difficult to know what to do next. In addition to the emotional stress of losing someone close to you, you may also be dealing with financial issues you weren't prepared for. Take some advice from a recent article in the Des Moines Register titled "Important financial steps to take following a death." The article contains a helpful checklist to help guide you through the matters that will need attention.

Here are some of the initial tasks:

Partial Roth IRA Conversions May Reduce Tax Impact for Houston Investors

Published on: September 8, 2014 | By McCulloch & Miller, PLLC

Today, ordinary income plus various other taxes could boost the effective tax rate on those second-level RMDs well over 40%. Who knows what tax rates might be in effect when current clients eventually pass their IRAs to future generations?

Some individuals choose to have partial Roth IRA conversions so they remain in their current income tax bracket and decrease other taxes and charges, according to a recent article in Financial Planning titled "Estate Planning: Smart Roth Conversion Trick." Along with a Medicare surtax and deduction phase-outs, Medicare Part B premiums are also part of the mix.

Medicare enrollees typically pay about $105 monthly for Medicare Part B. This covers doctor bills and some other medical expenses. However, seniors who have a modified adjusted gross income (MAGI) above $85,000 (or $170,000 on joint returns) will pay anywhere from roughly $145 to $335 a month for that same coverage. This is because Roth IRA conversions increase an individual's MAGI. The original article advises those in this situation to take an annual series of partial conversions now to thereby limit future taxes, as well as “stealth” taxes like extra Part B premiums.

The Elder Justice Roadmap Initiative May Help Houston Elders

Published on: September 5, 2014 | By McCulloch & Miller, PLLC

Given the widespread health, legal, social and economic implications of elder abuse, the Elder Justice Roadmap Project sought the input of experts and stakeholders from across the country in order to develop a strategic resource — by the field and for the field — to combat elder abuse, neglect and financial exploitation.

Impacting about five million Americans each year, elder abuse is a crime that can include physical, sexual, and psychological abuse, neglect, abandonment, and financial exploitation. This abuse results in thousands of cases of illness, injury and suffering for elderly victims, their loved ones and their caregivers. It is tragic that so few cases are reported to the authorities. According to some statistics, only about one in 24 is reported. With Baby Boomers retiring and this widespread impact of elder abuse, the Elder Justice Roadmap Project was initiated to collect the thoughts of experts and stakeholders from across the nation. Their aim was to develop a strategic resource to fight elder abuse, neglect and financial exploitation. The project's report identifies and prioritizes actions that direct service providers, educators, and researchers can take to benefit older adults in this situation. And as its name implies, it provides a roadmap for strategic investment and engagement by policymakers in both the public and private sectors to advance these efforts to prevent and combat elder abuse.

The Elder Justice Roadmap Project’s publication came about after President Obama pledged to eliminate the victimization of older Americans. On June 11, he proclaimed World Elder Abuse Awareness Day and declared that the government must improve the criminal justice response and work harder to ensure all Americans have the “right to enjoy their retirement years with a basic sense of security.”