Houston Estate Planning and Elder Law Attorney Blog

A Revocable Trust is Just One Part of an Estate Plan

Published on: October 4, 2019 | By McCulloch & Miller, PLLC

The last step of an estate plan is one that all too often gets forgotten. That’s too bad, because unless you retitle assets so that they are owned by the trusts created for the plan, means that all good planning could be worthless.

When you are done creating an estate plan, your estate planning attorney might give you a list of items that you need to take care of, including retitling or changing the ownership of things like bank accounts, brokerage accounts, shares of a privately owned business, real estate and other assets.

These assets must be put into the trust while you’re alive, to avoid probate or be distributed to the trust as a beneficiary upon your death.

How You Can Make the Most of Social Security

Published on: October 2, 2019 | By McCulloch & Miller, PLLC

Just because you can take Social Security at age 62, doesn’t mean you should. Taking it earlier means that your monthly benefits will be reduced. The longer you can wait, ideally until age 70, the better.

Applying for Social Security benefits is a pretty simple process, according to Investopedia’s recent article, “When To Apply For Social Security Retirement Benefits.” The earliest you can apply is when you are 61 plus nine months, or four months before benefits are scheduled to begin. Your first Social Security payment will occur four months later, which is going to be the month after you celebrate your 62^nd birthday. After that, benefit payments arrive after every full month that you are eligible, if you apply as soon as you are eligible.

Applications can be submitted either online, over the phone, or in person at your local Social Security office. A very convenient way to apply is online at the Social Security Administration website. The application itself takes about 15 minutes and can be saved at any point for future completion. This application can also be used to apply for Medicare.

Helping Parents Be Sure Their Families are Protected

Published on: September 30, 2019 | By McCulloch & Miller, PLLC

Yes, it is old-school, but if your family is on the traditional side, headed up by a breadwinner dad who runs the finances, then you need to make plans to ensure that your family will be okay, if something should happen to you.

This advice also applies to mothers who are the main breadwinners and run their family’s finances, even though the title of this Forbes article is “How Fathers Can Make Sure Their Families Are Financially Protected.”

Do you have enough life insurance? Be sure you’re adequately insured, so your family won’t struggle to pay the bills without your income. Many employees only have enough life insurance from work to cover a year’s worth of salary, which may be enough for some families. However, if your spouse can't make the mortgage payment on their own, and if they would be unwilling or unable to sell the home, you might want to at least make sure you have enough life insurance to pay off the mortgage. Once you know how much you need, buy a low-cost term policy for the maximum length of time you might need the coverage.

Next Steps When the Diagnosis is Alzheimer’s

Published on: September 25, 2019 | By McCulloch & Miller, PLLC

We hope to enjoy out golden years, relaxing after decades of working and raising children. However, as we age, the likelihood of experiencing health issue increase. That includes Alzheimer’s disease and other forms of dementia.

Learning that a loved one has Alzheimer’s or other diseases that require a great deal of health care is devastating to the individual and their families. The progressive nature of these diseases means that while the person doesn’t need intensive health care yet, eventually they will. According to an article from Newsmax, “5 Insurance Steps After Alzheimer's Strikes Loved One,” the planning for care needs to start immediately.

Alzheimer’s Disease International predicts that 44 million individuals worldwide have Alzheimer’s or a similar form of dementia, and 25% of those living with it never receive a diagnosis. Healthcare, including assisted living, memory care and in-home care is expensive. Health insurance is an important component of managing the ongoing expenses of living with Alzheimer’s.

How the Blended Family Benefits from an Estate Plan

Published on: September 23, 2019 | By McCulloch & Miller, PLLC

With about half of all marriages ending in divorce, second marriages and blended families have become the new normal in many communities. Estate planning for a blended family requires three-dimensional thinking for all concerned.

An article from The University Herald, “The Challenges and Complexities of Estate Planning for Blended Families, ” clarifies some of the major issues that blended families face. When creating or updating an estate plan, the parents need to set emotions aside and focus on their overall goals.

Estate plans should be reviewed and updated, whenever there’s a major life event, like a divorce, marriage or the birth or adoption of a child. If you don’t do this, it can lead to disastrous consequences after your death, like giving all your assets to an ex-spouse.

Talking About Financial Planning with Aging Parents

Published on: September 19, 2019 | By McCulloch & Miller, PLLC

Unless you are raised in a family that talks about money, values and planning, starting a conversation with elderly parents about the same topics can be a little awkward. However, it is necessary.

In a perfect world, we’d all have our estate plans created when we started working, updated when we married, updated again when our kids were born and had them revised a few times between the day we retired and when we died. In reality, a recent report by Merrill Lynch and Age Wave says that only half of Americans have a will by age 50.

More than 50% said their lack of proper planning could leave a problem for their families.

Can I Do Anything About 401(k) Taxes?

Published on: September 17, 2019 | By McCulloch & Miller, PLLC

After years of enjoying the deductions for putting money into retirement accounts, it’s always an unpleasant stunner when people realize they have to pay taxes on their withdrawals. Or do they?

Converting a 401(k) to a Roth IRA or Roth 401(k) will eliminate the need to pay taxes on withdrawals, says Investopedia’s recent article, “How to Minimize Taxes on 401(k) Withdrawals.” However, you have to follow the rules for a qualified distribution. Make no mistake: you’ll also have to pay taxes on any funds that are converted.

The primary issue with converting your traditional 401(k) to a Roth IRA or Roth 401(k) is the income tax on the money you withdraw. If you’re near pulling out the money anyway, it may not be worth the cost of converting it. The more money you convert, the more taxes you’ll owe.

Did Groucho Marx Have Estate Planning and Elder Care Problems?

Published on: September 13, 2019 | By McCulloch & Miller, PLLC

“By the time Groucho was an old man, however, he experienced significant problems in his daily activities, medical decision-making and the management of his estate. He suffered from elements of dementia, a heart attack and congestive heart failure, falls resulting in a broken hip, and after that hip was repaired, another fall and broken hip, urinary tract infections, strokes and hypertension.”

Julius Henry Marx, better known as Groucho, died 42 years ago on Aug. 19, 1977, at age 86. Groucho teamed with three of his four brothers—Harpo, Chico, and Zeppo—to become stars of vaudeville, Broadway, film, radio and television. (A fifth brother, Gummo, wasn’t part of the act).

PBS News Hours’ recent article, “How Groucho Marx fell prey to elder abuse” reports that the legal battles over Groucho’s money and possessions went on long after he died. The unrest of his last few years is familiar to adult children concerned with the well-being of their elderly parents.

How Does the Social Security Disability Benefit Process Work?

Published on: September 11, 2019 | By McCulloch & Miller, PLLC

Social Security disability benefits are based on average lifetime earnings. How severe the disability is, or what the household income is, has nothing to do with the amount of money that will be paid.

If you have your annual Social Security statement, you can see what you’ll probably get in the Estimated Benefits section. However, this is an estimate and not a final number. The total amount a disabled worker and his or her family can receive is roughly 150% to 180% of the disabled worker's benefit. Eligible family members can include a spouse, divorced spouse, children, a disabled child and/or an adult child disabled prior to age 22.

The estimated Social Security disability benefit amount for a disabled worker receiving Social Security Disability Insurance (SSDI) in January 2019 is $1,234 per month. However, a beneficiary can receive either less than this or up to $2,861, according the article “What are the maximum Social Security disability benefits?” from Investopedia.

How Gray Divorces Impact Senior Lives

Published on: September 9, 2019 | By McCulloch & Miller, PLLC

It used to be unheard of, a divorce after fifty, sixty or even seventy years old. However, gray divorce is now becoming more common. There are pitfalls to be aware of, before taking this big step.

According to the National Center for Health Statistics and the U.S. Census Bureau, younger Americans are divorcing at much lower rates, while divorces for adults over 50 have just about doubled since the 1990s. Back in the 90s, for every 1,000 persons age 50 and older, only five divorced. In 2015, for every 1,000 married persons age 50 and older, 10 are divorced.

The issues of a gray divorce are very different than those of a younger couple, not to mention the financial and legal complexities of marriages that span decades.