Articles Tagged with Beneficiaries

8.15.19“Until death do us part” sounds very different when you are in your twenties and getting married for the first time. As a couple travels through a life together, the time comes to create or revise an estate plan.

Granted, the estate planning process isn’t as much fun as planning a wedding but preparing for property distribution and planning for incapacity is a way to protect your spouse from having to deal with most preventable issues during a crisis. It can also prevent any number of unpleasant surprises.

Despite this, 17% of adults don’t think they need a will, believing that estate planning is only for the very wealthy. No matter how few assets it seems someone owns, completing a few documents can make a huge difference in the future.

5.13.2016Recent change in tax laws have many people rethinking their estate plans. Also, changes in the normal course of life make it a good idea for persons with estates that range from small to large to review wills, trusts, powers of attorney and beneficiary designations of insurance, IRAs, and other interests to achieve the most beneficial tax advantages.

In the beginning of January 2013, Congress made permanent the ability of a person to acquire his or her deceased spouse’s unused estate tax exemption through portability, and approved the larger estate and gift tax exemption of $5.45 million (for 2016) per person adjusted every year for inflation. For a married couple the exemption is potentially double that amount, or $10.9 million (for 2016). We believe that it is important for you to know that you may have an alternative to simplify your current trust structure without paying any estate tax, and in fact, for your beneficiaries to pay less income tax.

You may have an “AB Trust” or “ABC Trust,” or a Family Trust that creates a Decedent’s Trust (also referred to as a “Bypass Trust”) and a Survivor’s Trust on the death of the first of you or your spouse. The recent legislation makes it useful to examine whether such trusts should be changed to simplify their operation. The trust could be simplified by eliminating the need to create new trusts if one spouse passes away survived by the other. Simplification of a trust would result in several benefits:

5.12.2016It is not easy to be a member of a military family. They face many challenges that civilians do not, and—all too often—they do not receive the support in two critical areas that could make a difference.

Risks for Houston military families include accidents during training, battlefield injury and the stress of frequent moves. Service members have a far greater than average chance of becoming disabled or dying prematurely. This makes it especially important for military families to have access to financial and estate planning advice.

The Wall Street Journal article, "How to Serve Military Families," says that in many instances military spouses are young and financially immature. Military families don't settle in one place for very long, so a nonmilitary spouse may have trouble finding a steady job that would provide a second income and a retirement plan. In that situation, if something happens to the service member, and benefits are paid out, they need to be able to access them immediately. It's more likely that young military families will need help getting these estate documents in order and updating their beneficiary designations.

Wedding cake topperNaming a beneficiary for your IRA, 401(k) or any other retirement plan and then making sure that the name is right as you go through the many stages of life could be one of the most important financial decisions you make, according to The (Crystal Lake, IL) Northwest Herald in "Rectifying the retirement minefield."

Of course, if you want to give your retirement savings to your first husband, he won't mind. But your second husband might!

If you're married, you'll want to designate your spouse as the primary beneficiary. Federal law requires your surviving spouse to be the primary beneficiary in employer-sponsored retirement plans, like a 401(k), unless your spouse signs a written waiver letting you name someone else as the primary beneficiary. In most cases, spouses will name each other as the primary beneficiaries to their retirement plans. Those funds help maintain the lifestyle they've enjoyed in their marriage.

Bigstock-Senior-Couple-8161132"If you are looking at Baby Boomers, they are looking at what their cash flow will be in retirement," says Carol Kroch, managing director, wealth and philanthropic planning at Wilmington Trust in Wilmington, Del. "Can they do the things they want to do? Can they retire? Can they keep the house? They are not focused on death."

Failure to consider wills and estate planning is a frequent issue, and not just for Houston Boomers. Seniors usually think that it’s something they can put off and deal with later.

USA Today recently published an article, titled “Big retirement mistake: Boomers with no estate plan,”that offers several tips for people who might be lagging behind in their retirement savings. The article emphasizes that there are three very important things to think about when you start your estate planning (this week!):

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