pet-trust-estate-planning

How can you use estate planning to take care of your pet?

If you have a pet, he or she probably feels like part of your family.  So it makes sense to take care of your pet if you become incapacitated or pass away. Because if you don’t make any plans, your beloved companion could end up in an animal shelter or worse.

The law looks at pets as personal property. So you can’t just name your pet as a beneficiary of your will or trust without some careful planning.

Be careful with your Will.

Since you can’t name your pet as a beneficiary, you might consider leaving your pet and money for its care in your will to a trusted person who would be your pet’s new caregiver. But your pet’s new caregiver would not be legally required use the funds properly. In fact, your pet’s new owner could legally keep all of the money for themselves and drop off your beloved friend at the local shelter.

You’d like to think that you could trust someone to take care of your pet if you leave him or her money in your will to do so. But it’s impossible to predict what circumstances might arise in the future that could make adopting your pet impossible.

Also, a will has to go through the court process known as probate, which can last for months. That can leave your pet in limbo for a while.  And remember that a will only goes into effect upon your death, so if you’re incapacitated by accident or illness, it would do nothing to protect your companion.

Consider a pet trust.

A pet trust in a revocable living trust in order to be completely confident that your pet is properly taken care of and the money you leave for its care is used exactly as intended.

This way, you can lay out detailed, legally binding rules for how your pet’s chosen caregiver can use the funds in the trust. And unlike a will, a pet trust does not go through probate. So it goes into effect immediately and works in cases of both your incapacity and death.

Also, a  pet trust allows you to name a trustee. That trustee is legally required to manage the trust’s funds and carry out your wishes. And to provide a system of checks and balances to ensure your pet’s care, you might want to name someone other than the person you name as caregiver as trustee.

Do right by your pet.

With Myrna’s guidance and support, you’ll have peace of mind knowing that your beloved pet will receive the kind of love and care it deserves when you’re no longer around to offer it. Contact us today to get started.

Call us at (813) 902-3189.

Case Update: Jeffrey Epstein’s Estate

When the wealthy financier, Jeffrey Epstein, died under mysterious circumstances (the Medical Examiner determined that is a suicide, but many people are skeptical), he left behind a huge fortune close to $600 million, along with creditors and lawsuits. Just two days before his death, he signed his Will, which left his estate to his trust, the 1953 Trust. Because that Trust is not filed with the Court, its contents should remain private, barring litigation involving the Trust’s beneficiaries or trustee’s duties.

In the Will, Epstein is listed as a resident of the U.S. Virgin Islands. After his death, his Will was filed in the U.S. Virgin Islands, probably because his attorneys thought the probate process would be more private.

For regular people who are not rich or famous, privacy is still a huge deal. That is why many people opt for using trusts in their estate planning, instead of just relying on a Will.

Here are some important differences between a Will and a Trust:

Will characteristics:

  • A will goes into effect only after you die
  • A will only covers property that is in your name at your death
  • A will passes through a court process called Probate. In Probate, the court oversees the will’s administration and ensures the will is valid and the property gets distributed the way the deceased wanted.
  • Because a will passes through Probate, it’s a public record.
  • A will allows you to name a guardian for children (Note: Our firm recommends that in addition to this, you use a stand alone guardian nomination.)

Trust characteristics:

  • A trust can be used to begin distributing property before death, at death or afterwards.
  • A trust covers only property that has been transferred to the trust. In order for property to be included in a trust, it must be put in the name of the trust.
  • A trust passes property outside of probate, so a court does not need to oversee the process, which can save time and money.
  • A trust remains private Unlike a will, which becomes part of the public record, a trust can remain private.

Secure your wealth, your legacy, and your family’s future

Regardless of how much or how little wealth you plan to pass on—or stand to inherit—it’s vital that you take steps to make sure that wealth is protected and put to the best use possible. We have unique processes and systems to help you put the proper planning tools in place to ensure the wealth that’s transferred is not only secure, but that it’s used by your loved ones in the very best way possible.

By working with us, you can rest assured that the coming wealth transfer offers the maximum benefit for those you love most.

Call our office today at (813) 902-3189 to schedule a Planning Session and mention this article to find out how to get this $500 session at no charge.

 

How Will The Coming Wealth Transfer Affect Your Family?

Whether it’s called “The Great Wealth Transfer,” “The Silver Tsunami,” or some other catchy-sounding name, it’s a fact that a tremendous amount of wealth will pass from aging Baby Boomers to younger generations in the next few decades. In fact, it’s said to be the largest transfer of inter-generational wealth in history.

Because no one knows exactly how long Boomers will live or how much money they’ll spend before they pass on, it’s impossible to accurately predict just how much wealth will be transferred. But studies suggest it’s somewhere between $30 and $50 trillion. Yes, that’s “trillion” with a “T.”

A blessing or a curse?

And while most are talking about the benefits this asset transfer might have for younger generations and the economy, few are talking about its potential negative ramifications. Yet there’s plenty of evidence suggesting that many people, especially younger generations, are woefully unprepared to handle such an inheritance.

An Ohio State University study found that one third of people who received an inheritance had a negative savings within two years of getting the money. Another study by The Williams Group found that inter-generational wealth transfers often become a source of tension and dispute among family members, and 70% of such transfers fail by the time they reach the second generation.

Whether you will be inheriting or passing on this wealth, it’s crucial to have a plan in place to reduce the potentially calamitous effects such transfers can lead to. Without proper estate planning, the money and other assets that get passed on can easily become more of a curse than a blessing.

Get proactive

There are several proactive measures you can take to help stave off the risks posed by the big wealth transfer. Beyond having a comprehensive estate plan, openly discussing your values and legacy with your loved ones can be a key way to ensure your planning strategies work exactly as you intended. Here’s what we suggest:

Create a plan

If you haven’t created your estate plan yet—and far too many people haven’t—it’s essential that you put a plan in place as soon as possible. It doesn’t matter how young you are or if you have a family yet, all adults over 18 should have some basic planning vehicles in place.

From there, be sure to regularly update your plan on an annual basis and immediately after major life events like marriage, births, deaths, inheritances, and divorce. We maintain a relationship with our clients long after your initial planning documents are signed, and our built-in systems and processes will ensure your plan is regularly reviewed and updated throughout your lifetime.

Discuss wealth with your family early and often

Don’t put off talking about wealth with your family until you’re in retirement or nearing death. Clearly communicate with your children and grandchildren what wealth means to you and how you’d like them to use the assets they inherit when you pass away.

When discussing wealth with your family members, focus on the values you want to instill, rather than what and how much they can expect to inherit. Let them know what values are most important to you, and try to mirror those values in your family life as much as possible. Whether it’s saving money, charitable giving, or community service, having your kids live your values while growing up is often the best way to ensure they carry them on once you’re gone.

Communicate your wealth’s purpose

Outside of clearly communicating your values, you should also discuss the specific purpose(s) you want your wealth to serve in your loved ones’ lives. You worked hard to build your family wealth, so you’ve more than earned the right to stipulate how it gets used and managed when you’re gone. Though you can create specific terms and conditions for your wealth’s future use in planning vehicles like a living trust, don’t make your loved ones wait until you’re dead to learn exactly what you want their inheritance used for.

If you want your wealth to be used to fund your children’s college education, provide the down payment on their first home, or invested for their retirement, tell them so. By discussing such things while you’re still around, you can ensure your loved ones know exactly why you made the planning decisions you did.

 Secure your wealth, your legacy, and your family’s future

Regardless of how much or how little wealth you plan to pass on—or stand to inherit—it’s vital that you take steps to make sure that wealth is protected and put to the best use possible.

Call our office today at (813) 902-3189 to schedule a  Planning Session and mention this article to find out how to get this $500 session at no charge.

Part 2: The real cost of not planning

This article is part of a series discussing the true costs and consequences of failed estate planning. The series highlights a few of the most common—and costly—planning mistakes we encounter with clients. If the series exposes any potential gaps or weak spots in your plan, meet with us to learn how to do the right […]