Estate Planning 4 the Non-Traditional Couple
You have rights. Rights, privileges and choices. And yet for many of us, the day to day grind of the here and now distracts us from taking the simple steps to insure our choices are of our own making.
During our lifetime we invest heavily. We invest in our careers, we invest in our material possessions and we invest in our relationships. We accumulate stuff, mementos of special times, art and music. We purchase vehicles and homes. We build relationships, friendships and partnerships.
And yet, with the things we consider ours – the laws of the state can step in and dictate their dispensation at the time of our passing – unless we act upon our legal rights.
Rules, laws and regulations have long been in place to protect the privacy and rights of individuals and families. These rules grow stronger as the fear of litigation permeates almost every aspect of society. One segment of the population that benefits from this protection are those that are vulnerable due to age or infirmity. When we become sick who will care for us? Who will advocate on our behave? Who has the right to speak with the medical professionals and to make decisions regarding your care?
If you are part of a non-traditional relationship, the old adage Blood is Stronger than Water holds very little truth. And yet it might be said that certain laws base the rights of decision and ownership upon this questionable axiom. These same laws allow for personal choices – But Only If one takes the proper legal steps to establish and declare their own wishes and decisions.
A Catastrophic Illness or a simple accident can land us in a hospital or nursing home, and these serious incidences are not strictly reserved for the elderly. More and more often medical facilities will only discuss the condition and care of the patient with the patient’s ‘legal guardian’. If the patient has not taken the simple legal steps, prior to the unexpected illness or accident, to appoint whom they want to serve as their legal guardian in matters of health care, and they are unable to make decisions due to their condition, the courts may now have to intervene. A court appointed conservator or a costly court proceeding by a relative is often the next step. But what if the undocumented choice would have been someone other than a blood relative? Would the domestic partner of the patient have a better idea of what choices need to be made, what the patient would want to have done? In many cases this may be true, but lacking the required legal paperwork, the domestic partner has no say in the medical care or decisions that will need to be made.
When the medical facility directive is that no one other than family can visit the patient, what previously documented steps could allow for the presence of a domestic partner? Failing to prepare for this possibility could find a person sitting in the waiting room hoping that a sympathetic family member will be willing to share information.
The passing of a loved one is difficult enough. In a non-traditional partnership where a residence is shared, assets are mingled and possessions are held in common, life becomes difficult as the blood relatives step in to exercise their legal responsibilities and rights.
Think about that last sentence. “Their legal responsibilities and rights”. You need to carefully consider that statement. Today you control what happens to your assets and possessions. Do you want to sell, buy, trade, make a gift of, donate, invest or hang onto the things you have worked hard to acquire. This is your legal right, which we easily take for granted. Of course with these rights we understand that there are also responsibilities and obligations.
But we can not be naive about the inevitable. Your legal rights and responsibilities, at some point in the future, will and must be transferred to another person. Illness, incapacitation, incompetency, old age or death require that someone step in to manage your business affairs, make decisions about your care and eventually administer the assets that make up your estate; home, car, cash & investments and all your material possessions. Who will that be?
If you have planned ahead, taken the necessary steps and acquired the proper legal documents – your wishes will and must be honored. This is not a difficult undertaking, but one that requires a certain commitment and maturity. A commitment to those people you love and care about and a maturity to face up to the reality that all of us will at some point in the future face illness and / or death. The fact that you are reading this now is an indication that you still have time to take these important steps, but procrastination can be your enemy here just as our inability to face up to our own mortality. We all know people who died way too soon, unexpectedly. Living well includes leaving behind your affairs in an orderly manner that honors your friendships and relationships.
So what are your choices when it comes to Proper Legal Documentation? At this point I will restate that any and all information here is for informational purposes only and what documents and planning is best suited for you and your situation will be determined in a personal interview with your qualified estate planning attorney.
There are only two documents that are recognized by the state when a person passes away. The deceased either has a Will or a Trust. If they have not taken the steps to acquire one or the other of these, the state will give them a will and lets just say it has a very good chance of falling short in reflecting the true wishes of the deceased.
A Will is the most common document of which we are aware. Most of us had not considered nor thought there was any other option – a person gets a will and when they die………….??
Well what does happen when a person who has a will dies? First we need to understand that a will only has provisions for after a person dies. Legal guardianship and power of attorney which become of great importance if Illness occurs, are handled in separate documents, which can be loosely tied together with the will.
A will is a simple document that can be prepared by an attorney or an individual. With proper witnesses and unambiguous language you can express your wishes on how your possessions will be distributed after your death. But these are only your wishes. The final decision of how your estate is settled lies with the judicial supervisor in whose court room your estate will be probated. Probate is the required legal process through which all Wills are taken. The probate process is difficult to describe since every one’s experience with it differs. Some will say it was not a big deal while others will tell you of the nightmare they went through dealing with attorney’s, relatives, forms, fillings and fees. In most cases, time, money and emotions are heavily invested and the potential for disagreement and disappointment can be high.
Since probate is carried out in the public courts – it is a matter of public record and therefore falls under the rules of open records, allowing anyone to access all the details of your will and distribution of your assets. In studies conducted by AARP, Elder Law Solutions and in the book Beyond the Grave by Gerald Condon, it has been estimated that the cost of probate can deplete an estate of between four and seven percent of its total value.
What will it cost to probate your estate? – no one can say. Will the cost of probate be increased by family members who wish to contest your will and your wishes? “Contestable” means someone disagrees with the provisions of your will and goes in front of the judge to complain. By law it is up to the judge to decide the merits of the complaint and to alter your will if they deem the merits of the contest are valid. So – your will and your wishes may not be honored using this document choice.
In addition since a will is contestable and the final decision on how assets will be distributed happens within a court of law, there is great uncertainty. The full implications of this uncertainty are ones we must be aware of as we plan for our future. This is especially true if we are involved in a non-traditional relationship and our wishes are that our possessions be distributed to people other than blood relatives. What will happen to my home and financial assets? Who will be allowed to live in my home? Can my family of origin simply pack up my belongings and sell my home? Addressing these questions and concerns is an important part of good planning.
In summary – the probating of a will takes time, costs money and is a public affair. It is often contested and the final decisions rest with the courts.
What other options do we have?
(Again let it be clear that any and all information here is for informational purposes only and what documents and planning is best suited for you and your situation will be determined in a personal interview with your qualified estate planning attorney.)
The only option aside from creating a will as your estate planning document or ignoring the reality of the issue and doing nothing – is a Trust. For the purpose of this discussion we will speak in general terms of a Revocable Living Trust. There are multiple ‘flavors’ of trusts and which would be the best for your situation will be determined by you and your attorney.
Unlike a will which is a document and stipulates what will occur after death, a Revocable Living Trust is an entity providing living benefits as well. As an entity it can own and hold property. It specifies who controls the assets it holds (the Trustor, that’s you); who manages the assets (the Trustee, that’s you also) and who benefits from the assets held in the trust (that’s you again). It clearly specifies who takes over in managing the assets within the trust when you no longer can, due to illness or death and of course it spells out who will receive the assets when you are gone.
By making changes to the ownership of our assets from you to the trust (a process called ‘Funding’) you now own nothing and the trust owns everything. Who controls and manages the trust ? – You do. The legal concept is that at your death whatever assets are in the ownership of the trust avoid the probate proceedings. By assuring that all of our assets remain in the trust our successor trustee (the person you choose to take over at your death) can settle the trust without having to go through the courts. The reduced amount of time needed for this process and the privacy involved allows a trust to be handled free from being contested. Your wishes are honored.
Revocable Living Trusts, by name, can be altered and changed by the trustor (you) any time prior to death. Once a person passes away the trust becomes irrevocable and can not be changed. A properly drafted Revocable Living Trust should also include provisions for guardianship and power of attorney if the owner of the trust becomes ill and needs help with medical or business affairs.
Non-traditional couples will often find a Revocable Living Trust to be the best method to assure that in a relationship not recognized as binding by the laws of the state, that their assets and possessions are distributed according to their wishes and avoid costly and time consuming heartaches. The Revocable Living Trust also stipulates who will be in attendance and in charge in medical matters, another important benefit for the non-traditional couple.
Is a Revocable Living Trust right for your situation? This is a choice you need to make. Doing nothing, avoiding the issue, only causes our loved ones problems and anxiety in the future.
Obtaining a Trust to protect your estate and your loved ones is only the first step. Properly funding the trust (retitling all of your possessions into the trust) can be a complicated process. Assuring that the trust stays current also is important, as your life, assets and tax laws change. Most importantly is arranging that assistance is on hand for the time when you are no longer here and the task of settling the Trust is given to the person you have chosen to be your Successor Trustee. Arranging for this needed assistance can mean the difference between a long and costly settlement and a quick and cost free process for those you leave behind.
I congratulate you for persevering through the reading of this information. It probably has brought up many additional questions for you. It would be my pleasure to continue educating you on this subject and tell you how I coordinate protecting you, your estate and your loved ones with professional and legal experts.
Please contact me at
608 / 225 -7314
Conversation on WHAT EVERY MAN NEEDS TO KNOW
Your thoughts and opinions are welcomed and encouraged here. No judgments no right or wrong. How do you feel about your ability to response honestly to the questions about Where you come from, Where are you at Right Now, Where are you going, Your Friends and Your Gifts?
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Nine Things Every Guy Oughta Know – What’s the Tenth?
This is a space to get your opinion on what is the 10th or 11th or 12th that every guy oughta know.
Some friends have suggested changing the oil in a car, fixing a bike, gutting an animal, and planning a night out.
What do you think? Any comments on what you read? Corrections, feedback.
Get the conversation going!!
Not Everything is an EVENT!!
I love a party. A holiday gathering, a celebration. A time set aside to honor or remember a loved one, a friend or event. Good food, libations, conversations, laughter, dancing. A time set apart from the everyday activities and routines to mark a special occasion. We as humans have much to gain from celebrations. Some cultures do this better than others, some do it more often. Whether religious in nature or secular, patriotic or the simple recognition of another passing year celebration is good for the soul.
But not everything is a celebration. Not everything should be made into an event. Before you think that I am getting all scrooge about this let me explain.
With the New Years celebration so recently behind us, decorations from the holidays and Christmas lights still adorning most homes, many of us are preparing to launch upon our New Year’s Resolutions. We’re eyeing that pair of slacks that we’ll fit into once our new diet kicks in, or mentally spending the money that will certainly be there once our new work commitment or family budget is in place. We’ve got the goal and set the beginning date of when our new plans take effect. Next week we begin. As soon as the holidays are over. Right after the relatives leave and the house is in order. The problem is that we’ve done this before, and it didn’t work then, or even the time before that.
All of life is a celebration. A series of events, some happy some joyous some sad some just everyday normal humdrum. We string these together and they become our life story. We seek happiness and opportunities to break out of the normal day to day routines, although routine does provide a foundation and stability. Within routine are the habits that provide mental, emotional and physical security. It is within routine that we perform all the functions that we know and do well. On a routine day we can often slide through our required activities with adroitness and grace. It is within the routines of a regular day that our habits exist.
Our habits, those things we do without even thinking about them. We wake up at a certain hour, do our grooming, get dressed, go off to our work place or other responsibilities and can often flow through these activities without much mental exertion since we’ve done it hundreds of times before. We have eating habits, exercise habits, study habits, good habits and bad habits.
Here is a quick exercise. Grab a sheet of paper and right down all your good habits. Next write down all the things you know you should be doing, dividing both lists into categories. For example under financial you might have that you are price conscience when shopping for groceries as something you already do. Then you add to the list that a good habit (you know this because you have heard it, read it, or been taught) would be to spend from a predetermined budget. Under the category of health you list all the truths you know about good eating. Less sugar, more vegetables, drink water, daily physical activities.
These are the habits of a good life. The truth is we already know them. We’ve heard the messages, read the reports, and probably even practiced them at one time or another. If you feel your list is difficult to complete in a certain area, or are truthfully uncertain about the activities that would produce a desired result in your life then you now have a goal – an obligation – to search out the knowledge. And knowledge is everywhere!
Let me divert to what might seem to be an unrelated topic and then we’ll tie it back in. When a pilot prepares for a flight there are many factors to consider. Wind, weather, distance, altitude, etc. In a larger commercial plane much of this is precalculated with the use of computers and the automatic pilot is engaged (think habit). It is the automatic pilot’s job to make constant small adjustments bringing the plane back on course. I have heard it said that a plane is off course most of the time and it is the job of the pilot to regularly and consistently bring it back on course. Obviously if the plane is allowed to veer off course for too long the adjustments will need to be greater. But the course is programmed and the destination is always in sight.
The list you made of good habits is the journey, the route, the preprogramed course plan. The wind and changing weather are the events of our life, some under our control, some not. These events can take us off course, if we allow them. A family members birthday celebration. To cake or not to cake? An unscheduled meeting at work. Do I allow my goal of completing my daily report to slide? It was a late night out with friends, do I sleep in or stay committed to that daily run?
If we allow everything in life to become a special event then we are also allowing everything in life to disrupt our good habits. ‘Lets look at the desert menu, we haven’t been out with these friends in so long, this is a special night’. ‘I can catch up on these reports tomorrow, that sale deserves to be celebrated’. ‘I can run longer tomorrow, last night was a pretty exciting time’. Nothing is bad or wrong, yet everything is under our control.
While we participate in the events in our life, be they special or ordinary, we also tend to turn our goals into events. A diet becomes a special program. A family budget becomes is a special plan. Reading a book a week is a special goal. And now that they are events we place them into a certain time frame. Right after the holidays I will begin my diet program. Our family spending plan kicks in on January 15th. I plan on getting to the library this weekend. The problem is that good habits don’t have ending points like events do. An event eventually ends. Most of us will always be eating something, spending money and hopefully reading for the rest of our lives. No end to these activities.
By making a goal an event we also can blow it. We get off track by missing a deadline, a workout or eating too much. The event is over and we’ll have to decide when to start again. Until then we just fall back into the bad habit routines anticipating the next starting date.
Not everything is an event! Just like the airplane on it’s flight across country, course corrections are not an event, they are routine and necessary to a safe trip and successful landing. When we accept the list of good habits as our travel plans through life then each day is simply a matter of making small course corrections. Our knowledge of what is good and right in our lives is our standard, the place to which we come back to on a daily basis. “I had a donut from the break-room this morning, the chicken salad looks good for lunch” is a lot better than “that donut I had blew my diet, no reason not to have the burrito plate for lunch”.
By allocating the habits which we know to be good, those that lead us through a life of love, peace, kindness, good health and self control, to be our standard for living, our daily objective is clear. By regularly renewing our minds to keep on course, to return to the standard, our lives become a sacred dance. While not everything is an event, the gift of life itself is a celebration. By focusing our thoughts and actions on the standard of good habits and ignoring our past deviations each day becomes a sacred celebration.
Even if we have wandered far off course, our choice to simply renew our mind and return to the proper course of what is right and good for us is a decision and not an event. This mindset allows us to think and act in terms of who we are now, not who we were or what we did in the past. We are not a participant in an event of a life change, but rather a person living life according to a standard of predetermined healthy habits.
The scripture is the best place to begin building a standard of daily habits. How we treat our bodies, how we go about our work, how we treat others, how to pray and study are all given as examples throughout the bible story. Since God has forgotten our past deviations we need to do the same. Just as God calls us back to Him regardless of the date or time or place or how long it has been since we were last in His presence, we can return to a lifestyle of habits that will edify us and others – any time and all the time.
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