Estate Planning

Why Life Expectancy Is Important to Financial Planning

Published on: September 27, 2017 | By McCulloch & Miller, PLLC

Statistically speaking, women live longer and earn less than men. That makes financial and retirement planning far more important for women.

It’s not pleasant to contemplate, but because women often take time out from their careers to raise children or take care of elderly parents and still earn less than their male colleagues, their life-time income is usually lower than the average male. While both sexes need to do financial and retirement planning, women are more likely to find themselves facing financial difficulties as they age.

The Marietta Daily Journal’s article, “With women living longer, more financial planning may be needed,” notes that while the gender pay gap is narrowing, in 2015 women earned 83% of what men earned, according to Bureau of Labor Statistics. This can mean that women get fewer Social Security benefits, save less for retirement, and have smaller pensions. Women are also more likely to live on their own in their senior years, either by choice, divorce or the death of a spouse.

How Long Does It Take to Get a Payment from a Life Insurance Policy?

Published on: August 9, 2017 | By McCulloch & Miller, PLLC

Most life insurance companies are quite efficient. However, you will need the right documents.

One of the basic tasks that follow the loss of a spouse or family member is figuring out what life insurance policies were in place and contacting the insurance company or companies to find out how to file for claims. How long it takes to receive the death benefit varies, but for the most part, insurance companies move quickly.

As a follow-up, what happens if the beneficiary doesn't know about the life insurance policy?

Estate Planning 101: Check Your Beneficiary Designations

Published on: August 7, 2017 | By McCulloch & Miller, PLLC

Unless you really want to give your ex the proceeds of your life insurance or 401(k), it is best to take the time to do this one task.

If you haven’t looked at the paperwork for your life insurance policies, bank accounts, retirement accounts, investment accounts and any other asset that names a beneficiary, right now would be a good time to take a look—especially if you haven’t done so in years. The number of horror stories of assets going to untended people would surprise you. It’s such an easy fix that is all too often forgotten.

MarketWatch’s recent article, “Make this estate planning move right now: Check your beneficiary designations,” explains how the Fifth Circuit Court of Appeals reversed the trial court by finding that a pension plan administrator didn’t abuse her discretion in determining that a deceased plan participant’s stepsons weren’t considered his “children” under the terms of the plan. As a result, the deceased participant’s siblings, not his stepsons, were entitled to inherit the plan benefits in Herring v. Campbell (5th Circuit 2012).

Your Mid-Year Estate Planning Checklist: 10 Things You Should be Doing Now

Published on: June 29, 2017 | By McCulloch & Miller, PLLC

Here is a helpful checklist of the top ten ways to keep your estate plan current.

Review your existing Will and any trust agreements. Over the course of a year our personal and our professional lives can change dramatically. Tax laws and regulations are also subject to change as new political administrations come into office. It is therefore important to periodically make sure that your documents will work the way you want them to. Some questions to ask: Is your plan tax efficient? Do you need to make any changes about the timing and manner in which your assets will transfer to your beneficiaries? Do you need to change any beneficiaries or add anybody new? These are all basic questions to keep in mind when reviewing your existing documents.
Consider whether your named fiduciaries are still appropriate. Your executors and trustees will be tasked with some significant responsibility. You should consider whether the persons you appointed in your documents are up to the tasks that lie ahead of them or if an alternate person or persons should be appointed.

You May Miss the Estate Tax, but Your State May Have Its Own Death Taxes

Published on: May 19, 2017 | By McCulloch & Miller, PLLC

Some states are cheaper to die in than others, that is, when it comes to death taxes.

The average American doesn’t have to worry too much about paying a federal estate tax, as the current federal estate tax exemption is a generous $5.49 million for 2017 and twice that if you are married. But that’s not the only death tax you and your heirs may encounter, depending on where you live or, more accurately, where you die.

MarketWatch’s article, “Here are the 20 most expensive places in America to die,” reminds us that about 20 states and DC have their own estate or inheritance taxes, or both. Some have exemption thresholds below the federal amount. Therefore, if you live in one of these states, you may be exempt from the federal estate tax, but still exposed to a significant state death tax bill.

Daughter Sues Mom, Charging Her with Draining Her Inheritance

Published on: May 15, 2017 | By McCulloch & Miller, PLLC

Legal battles that lasted longer than the marriage, continue to plague the daughter of a real estate investor.

A court action brought by a young woman, whose mother devoted nine years to gaining control of her trust fund, is now trying to free herself from her mother’s financial grip. Her daughter claims that her mother sold as many as seven Gramercy Park co-ops and an apartment building in Brooklyn and pocketed $13 million.

The New York Post reports in “My mom swiped more than $13 million from my inheritance,” that the daughter, Elizabeth Marcus, has tried for years to get a hold on a trust fund from her mom, Geraldine Lettieri. The trust was established for Marcus by her dad, real-estate investor Alan J. Marcus, before his death in 1994. The fight over his estate has been going on in Bronx Surrogate’s Court, where Lettieri first won control of the trust in 2003. Elizabeth says that Lettieri used the fund like a piggy bank, buying fancy cars and a mansion in the Hamptons.

Millennials, It’s Your Time to Start Planning for the Future

Published on: March 31, 2017 | By McCulloch & Miller, PLLC

Now that many members of the millennial generation are parents, it’s time for them to protect their families with estate plans, including naming guardians for their minor children. Yes, that generation is growing up!

The numbers are pretty extreme. A recent study by caring.com reveals that 88% of 18–36 year-old Americans don’t have either a will or a trust, as reported in Financial Buzz in a recent article, “Millennials: Start thinking about estate planning now!”

This compares to the 81% of Americans aged 72 and older who do have a will or at least a trust. If it seems like younger adults don’t think they need to deal with estate planning, that’s true. But they do, especially if they have minor children.

RMDs for Retirement Accounts: What You Need to Know

Published on: December 16, 2016 | By McCulloch & Miller, PLLC

New Year’s Eve is the deadline for taking RMDs if you are older than 70 ½. Haven’t started yet? Get on this right away to get it done in time. Otherwise, be prepared to pay a penalty.

You still have a little time to beat the last minute rush on taking your Required Minimum Distributions (RMDs) from traditional IRAs and 401(k)s, according to Kiplinger’s “FAQs About Required Minimum Distributions for Retirement Accounts.” However, you had better hurry if you are older than 70 ½. You only have until December 31^st and any delays could be expensive. Remember that you aren’t the only one making this transaction at this time of year, and you’re hardly alone in waiting until the last minute.

Here is some additional information to help you meet your deadline for IRA withdrawals and some special rules for 401(k)s.

For Entrepreneurs, Make a Succession Plan Part of Your Estate Plan

Published on: November 28, 2016 | By McCulloch & Miller, PLLC

Estate planning for entrepreneurs is not complete until it includes a succession plan. Individuals who create successful businesses often find it hard to consider handing over the reins.

Entrepreneurs would not succeed without their ability to focus all of their energies on their business. It is not easy for this type of person to imagine that one day they may want to retire or that the possibility exists that they might become ill, injured or even die. Without an effective estate plan that includes a succession plan, their work, staff and families may be placed in jeopardy.

A recent business.com post, “5 Estate Planning Tips for Entrepreneurs,” lists these important estate planning essentials:

When Naming a Guardian for Minor Children, Don’t Stop at One

Published on: November 7, 2016 | By McCulloch & Miller, PLLC

Many people put off doing their wills because of the difficulty of deciding on a guardian for their minor children. But if choosing one is difficult, choosing two might actually make the process easier.

This is the situation no one wants to even think about: both parents dying unexpectedly and young children being raised by someone else. But it does happen. That’s why having a will and naming a guardian is so important for anyone who has children. Usually the problem is deciding between someone who is really good with your kids but who might not be so good or experienced with handling money and investments. But there is another way, as explained by NJ 101.5 in “Choosing guardians for your minor children.”

Yes, you can appoint one person as a guardian of the person—he or she will care for your child—and designate another person as a guardian of the estate—this person will care for your child’s assets. Typically when minors are part of estate planning, the parents’ assets are put into trust until the minor reaches a specified age(s) when distributions are authorized or required to be made. As an illustration, the trust can dictate that a third of the balance be distributed when the beneficiary reaches age 25, a third when he or she reaches age 30, and the remainder when the beneficiary reaches age 35. At that point, the trust will be terminated.