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Read GoFisch: January 2019 Edition of GFLF’s Newsletter

man reading on tablet

The January edition of GoFisch is live! This month’s edition features:

Like what you read? Don’t forget to subscribe to GoFisch and tell your friends. I like to think of it as the least boring law firm newsletter you could hope to read! Also, if you ever have any suggestions for content you would like to see, do not hesitate to contact me.

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Top 10 Estate Planning Goals

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An estate plan is simply a set of legal documents to prepare for your death or disability. The specific documents you’ll need depends on various factors, including the number, size, type of your assets, and your overall estate planning goals.

If forced to list the top 10 major components and the associated goals of a comprehensive estate plan, I’d list the following (in rough order of importance):

  1. A plan for orderly disposition of all your property of your choosing.
  2. Naming guardians to raise and care for minor children.
  3. Naming fiduciaries to handle minor children’s assets.
  4. A plan to help fund the charities you supported during your lifetime.
  5. A financial power of attorney so you can name an agent to manage your financial decisions, if you are ever unable to do so, with as specific (or non-specific) directions to the agent as you desire.
  6. A healthcare power of attorney so you can name an agent to manage your financial decisions, if you are ever unable to do so, with as specific (or non-specific) directions to the agent as you desire.
  7. A plan for succession or sale of a business (often a close corporation or family business).
  8. A plan to dispose of property in a tax advantaged manner.
  9. Planning for life insurance to support those economically dependent on you and/or to provide liquidity for the estate.
  10. Making known your wishes (whether simple or complex) regarding the disposition of your final remains.

Of course, any order of importance is unique to that individual. Someone with, say, minor children will find items #2 and #3 incredibly important. Someone else with adult children, or no children at all, but with a very large estate may look at #8 as quite significant. One list doesn’t fit all, just like there’s no one-size-fits-all solution for estate planning.

 

woman cheering at water's edge

What are your estate planning goals? Feel free to share with others in the comments below.

Estate planning is a smart step you can take today. The easiest way to get started is with my free, no-obligation estate plan questionnaire. If you have questions or want to discuss your individual situation, don’t hesitate to reach me by phone (515-371-6077) or email.

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Young People Should Be the Most Concerned with Estate Planning

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Young couple holding hands

So, WHO needs an estate plan, anyway?

Who needs to be most concerned with estate planning? What age group? Ask Iowans this question, and I’ll bet most would conjure up the image of a retiree who just spent 50+ years working hard to acquire significant assets. Of course, it’s important for this demographic to have a quality estate plan, that’s fairly obvious.

But, imagine a young, married couple. They both have good jobs, live in a fine starter home, and have a baby.

 

crying newborn baby

This young couple tries to put away a little bit of money for savings, in a 529 college fund, and for retirement. Why should they worry about estate planning?

The truth is, this young couple should be just as concerned–arguably, even more concerned–with estate planning as the retiree.

Here are four reasons why:

  • Choosing guardians for minor children. In an estate plan, you can choose the guardians of minor children (e.g., children under age 18). If you should become incapacitated, or even die without any estate plan, an Iowa court would have no choice but to appoint a guardian for your children – but it may not be who you wanted or would have chosen. Better to have plenty of time to consider and make a careful, well-reasoned choice.

Show Your Kids You Love ‘Em with a Testamentary Trust

  • Save on fees, court costs, and taxes. A good estate plan can save you and your estate money on fees, court costs, and taxes. These savings can be even more critically important for a smaller estate (more likely when you’re younger), than for larger estate (more likely as you grow older). Often, young folks actually have the greatest need to save money to pass along the greatest amount they possibly can to family and loved ones.

 

  • Help favorite charities. Having an estate plan means that you can put into place immensely helpful donations for your favorite charities. Without an estate plan there’s no opportunity for you to help your favorite charities

Let’s Head Back to School! First Lesson is on Planned Giving

  • Life is uncertain. It may be awkward to talk about, but life isn’t guaranteed for any of us, young or old. There’s an old saying in estate planning circles that goes, “People don’t always die when they are supposed to.” Wives usually outlive their husbands, parents usually outlive their children, and so on, but not always. It is best to be prepared for anything and everything.

 

Mom and daughter hugging

Who should be most concerned with estate planning? I actually think young people should be!

Whatever your age, if you are interested in estate planning (as everyone should want to check it off their list), a good place to start is my free Estate Planning Questionnaire. Questions? Want to discuss you personal situation? Contact me for a free consult!

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Read GoFisch: November 2018 Newsletter

reading on phone in office

The November edition of GoFisch is live! This month’s edition features:

Like what you read? You could think of it as a free holiday gift to yourself to subscribe! Here at GFLF we like to think of it as the least boring law firm newsletter you could hope to read.

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You Need a Financial Power of Attorney ASAP

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Financials in book

What is a financial power of attorney?

A financial power of attorney is a legal document that designates someone to handle your financial decisions on your behalf.

What happens if I don’t have a financial power of attorney?

If you do not have a power of attorney and you were to become incapacitated, any financial decisions would need to be made by a court-appointed conservator. At a court’s direction, the conservator would handle your financial assets. It’s a quite expensive and time consuming process, especially compared to the relative simplicity of executing a power of attorney.

After I die, can my agent continue to operate under my financial power of attorney?

A common misperception is that your agent will be able to use this power after your death. At your death, any power of the agent is automatically revoked and it will be necessary to switch management to the representative appointed through probate.

Laptop with finance info on it

Who should I choose to serve as an agent?

The agent you choose will be managing your finances, so it is critically important to choose someone trustworthy; someone who will not abuse or exploit this power; someone who will listen to your wishes, goals, and objectives, as included in the document or otherwise communicated; and, someone who will look out for your best interests.

You also have the option of designating a successor agent who can take over if the original agent is unable or unwilling to serve. This is highly recommended.

Who should receive a copy of my financial power of attorney?

The person named as agent and any person named as a successor agent should receive a copy. It would also be wise to share a copy with your financial institution(s), such as your bank or credit union.

First in Class: Importance of Power of Attorney for College Students

Can I revoke the financial power of attorney?

Yes, you may revoke the document, at any time. You can also amend the document (change it, revise it, etc.) at anytime.

Financial power of attorney is one of the six main documents which comprise Iowans’ estate plans. To get started on establishing your financial power of attorney contact me by phone at 515-371-6077 or email.

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5 Scenarios for Estate Planning Revisions

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Estate planning revisions

You have an estate plan? High five! You are already better off than most of your fellow citizens. In fact, numerous surveys have shown that about half of adult Americans do not even have a basic will. So, kudos to you if you’ve already knocked out this major life decision and planning initiative. If you already have a will, there are at least five major scenarios in which you should revisit and make changes accordingly:

  1. Moving out-of-state or out-of-country. What makes a will legal and valid in Iowa is not the same in other states, like, say, Ohio or Rhode Island. Each state has its own set of laws governing wills, probate, and so on. Also, if you buy property in another state and/or set-up a secondary residence, this must be included in your estate plan.
  2. If something happens to one of your beneficiaries or fiduciaries. Life happens to everyone else in your plan, and sometimes this means beneficiary passes away or a fiduciary retires. Reviewing your plan’s key contact list at least annually, in addition to on an as-needed basis, will keep everything fresh and relevant.
  3. If your marriage status changes. Needless to say, you will want to update your estate plan in the case of a marriage or divorce. Most estate planners you’ll meet can attest to horror stories on behalf of their clients of what happens when an ex-spouse inherits a huge sum of money, merely because an estate plan wasn’t properly updated.
  4. If you have kids (or more kids). You’ll want to ensure that in case something happens to you that your children are going to be protected by a trusted guardian. And, also, presumably you’ll want to add the children as beneficiaries, etc.
  5. If your financial situation changes significantly. This includes inheriting money or complex assets. Perhaps your business accelerates astronomically. Maybe you have what professional advisors call “a liquidity event,” (e.g., you’re flush with cash). Your estate plan, and its distributions, will need to be revisited to accommodate such changes in fortune.

Back to School: Political Science- How Changes to Legislation Impact Your Estate Plan

This, however, is just the tip of the iceberg! While your estate plan never expires, many other situations involving shifts in personal/financial goals, changes in needs (such as deciding you need a trust instead of just a basic estate plan), and even changes to legislation can mean estate planning revisions.

Have questions? Need more information?

If you think you may need to revise your estate plan and would like a free consult feel free to reach out at any time! You can contact me by email at Gordon@gordonfischerlawfirm.com or give me a call at 515-371-6077.

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Estate Planning: What About Trusts?

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brown books on shelf

When you hear the word “trust” it’s usually in the context of a belief of reliability of someone, such as: “I trust her to read about the past legal word of the day, quid pro quo.” Trust in the world of estate planning is entirely different, although you can certainly put trust in a well-crafted trust to maximize the benefits of an estate plan!

What is a Trust?

In simplest terms, a trust is a legal agreement between three parties: grantor, trustee, and beneficiary. This allows a third party (the trustee) to hold assets for a beneficiary (or beneficiaries). Trusts can be set up in a variety of ways and specify the details of when and how the assets will pass to the beneficiary. Trusts are a part of a well-crafted estate plan and can be used to minimize fees, costs, and taxes.

Let’s break it down further by looking at each of the three parties to a trust.

Grantor

 

All trusts have a grantor, sometimes called the “settler” or “trustor.” The grantor creates the trust, and also has legal authority to transfer property to the trust.

Trustee

The trustee can be any person or entity that can take title to property on behalf of a beneficiary. The trustee is responsible for managing the property according to the rules outlined in the trust document, and must do so in the best interests of the beneficiary.

What Is a Trustee & What Do They Actually Do?

Beneficiary

The beneficiary is the person or entity benefiting from the trust. The beneficiary can be one person/entity or multiple parties (true also of grantor and trustee). Multiple trust beneficiaries do not have to have the same interests in the trust property. Also, trust beneficiaries do not have to even exist at the time the trust is created (such as a future grandchild, or charitable foundation that has been set up yet).

Trust Beneficiary: Break it Down

Trust Property

A trust can be either funded or unfunded. By funded, we mean that property has been placed “inside” the trust. This property is sometimes called the “principal” or the “corpus.”

Legal Words of the Day: Tangible Property & Intangible Property

Any Asset

Any asset can be held by a trust. Trust property can be real estate, intangible property, business interests, and personal property. Some common examples of trust property include farms, buildings, vacation homes, money, stocks, bonds, collections, personal possessions, vehicles, and so on.

101 Assets You Could Place in a Trust

“Imaginary Container”

We speak of putting assets “in” a trust, but assets don’t actually change location. Think of a trust as an “imaginary container.” It’s not a geographical place that protects your car, for example, but a form of ownership that holds it for your benefit. For instance, on your car title the owner blank would simply read “the Jane Smith Trust.” It’s common to put real estate (such as farms, homes, vacation homes) and entire accounts (like bank, credit union, and brokerage accounts) into a trust.

After the trust is funded, the trust property will still be in the same place before the trust was created—your land where it always was, your car in the garage, your money in the bank, your stamp collection in the study, and so on. The only difference is the property will have a different owner: “The Jane Smith Trust,” not Jane Smith.

Transfer of Ownership

 

 

Putting property in a trust transfers it from personal ownership to the trustee, who holds the property for the beneficiary. The trustee has legal title to the trust property. For most purposes, the law treats trust property as if it were now owned by the trustee. For example, trusts may have separate taxpayer identification numbers.

But trustees are not the full owners of trust property. Trustees have a legal duty to use trust property as provided in the trust agreement and permitted by law. The beneficiaries retain what is known as equitable title: the right to benefit from trust property as specified in the trust.

Assets to Beneficiary

The grantor provides terms in a trust agreement as to how the fund’s assets are to be distributed to a beneficiary. The grantor can provide for the distribution of funds in any way that is not against the law or against public policy.

game of chess

Types of Trusts

The types of trusts are almost limitless. Trusts may be classified by their purpose, duration, creation method, or by the nature of the trust property.

One common way to describe trusts is by their relationship to the life of their creator. Those created while the grantor is alive are referred to as inter vivos trusts or living trusts. Trusts created after the grantor has died are called testamentary trusts.

Another way you can describe trusts is by whether they are revocable or irrevocable. A revocable trust can be modified by the grantor; an irrevocable trust cannot be modified or terminated without the beneficiary’s permission.”

But again, there are so many types of trusts, and the aforementioned are just a few examples.

Calling all Word Nerds: 9 Terms to Know About Trusts

Do YOU need a trust?

If you have substantial or complicated assets (for example, you own more than one piece of real estate), own part or all of a robust business, or have any other special circumstances, a trust may be incredibly helpful.

Great Place to Start: Estate Planning Questionnaire

A great place to start is with the estate plan questionnaire, provided to you free, without any obligation. Also, feel free to reach out at any time by email, gordon@gordonfischerlawfirm.com, or on my cell, 515-371-6077.

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Tune In to Hear Gordon on the Radio

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radio studio

On Halloween (10/31) my voice will be making a radio appearance on KCJJ 1630 AM‘s “Senior Talk” program hosted by Rex Brandstatter! We’ll be talking on the importance of estate planning for seniors, as well as the need-to-know information that ALL Iowans should know about creating a successful, quality plan for the future.

The program starts at 12:10 p.m. and will last for about 30 minutes. If you won’t be around a radio over the noon hour on 10/31, don’t worry as you can listen live via KCJJ’s YouTube channel. Plus, the program will be archived on YouTube after the show!

Hopefully my conversation will Rex will inspire you (and all of your family members and friends) to send those estate planning excuses to the graveyard. (Sorry, I had to get at least one spooky pun in there!) One of the best ways to get started on my five-step estate planning process is with the easy, free Estate Planning Questionnaire.

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Need a Speaker? Drop Me a Line!

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Gordon Fischer speaking at event

One aspect of running my own firm that I love is getting out and teaching groups of people. Just like mission, my presentations center on maximizing charitable giving. Be it through estate planning education, nonprofit board training, or sharing tools and resources for professional advisors, I’m always open to speaking at different organizations and events across the state of Iowa.

Gordon Fischer speaking at event

Here’s an example of a presentation I gave in a workshop open to the public, entitled “Basics of Estate Planning.” This presentation on clauses to include in an executive’s contract was focused toward a different audience—nonprofit employers. And just in case those samples weren’t enough, here’s a presentation I gave to my fellow estate planners on effectively including digital assets in plans. Of course, I modify my content so it’s applicable to the event, organization, and audience.

So, if you’re in need of a speaker on any topic related to my core services, don’t hesitate to shoot me an email at gordon@gordonfischerlawfirm.com or give me a call at 515-371-6077 to discuss your upcoming event and potential speaking topics.

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Survey: I Want Your Valuable Feedback

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feedbackk survey

I could use your opinions! As a lawyer who strives to maximize charitable giving in Iowa (the mission of Gordon Fischer Law Firm), estate plans are a regular part of my job. But, for most people, estate planning isn’t a normal part of the day-to-day. So, I am doing research on how and why people obtain estate plans and would appreciate if you could take three minutes (or less!) to share your thoughts and experiences with me. The goal of this survey is to gather candid feedback and varying perspectives on this topic. Note that the survey is completely anonymous and confidential.

Click here to take the short survey.

 

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