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Estate Planning: 5 Things You Should Consider

by Thomas D. Begley, Jr., CELA

  1. Grandchildren

Many grandparents would like to leave something to their grandchildren. Frequently, the grandparents have not thought of this idea, but are enthusiastic when it is presented to them. One way to remember the grandchildren in a Will is to leave a flat sum of money, i.e., $10,000 per grandchild, another is to leave the grandchildren a separate share. For example, grandparents with three children may want to divide their estate into four shares, one for each of the children and one to be divided equally among the grandchildren. Some grandparents want to establish trusts for their grandchildren and limit distributions for education. 529 Plans are also a popular idea for many grandparents.

  1. Gifts/Loans to Children

Frequently, parents have made gifts or loans to one or more children, but not to all children. The Estate Planning attorney should ask whether the parents intended the gifts to be an advancement against the child’s share of the estate and whether they intend the loans to be repaid from the child’s share of the estate. Frequently, these loans are not documented and often children make no payments or default rather quickly.

  1. Blended Families

A fairly high percentage of the population is engaged in a second or subsequent marriage. They have children by a previous marriage or marriages. Do the parents want to treat their children and stepchildren equally? If not, do they want to provide for their current spouse, and upon the death of the current spouse direct their estate to their own children? Do they want a portion of the estate to go outright to the children immediately upon death? Do they want their current spouse to have a life estate in the real estate in which the couple resides at the time of the first death? If so, who will pay the taxes, utilities and upkeep? Would the life estate end if the surviving spouse cohabits or remarries? Has a Prenuptial Agreement been signed? Should a Contract to Make a Will be considered?

  1. Disability

Is there a family member with a disability? If so, is that family member receiving or likely to receive in the future any means-tested public benefits such as SSI or Medicaid? If so, a Special Needs Trust should be prepared.

  1. Beneficiary Designations

The beneficiary designations on life insurance policies, annuities and retirement plans must be coordinated with the client’s estate plan. Clients should be advised to retitle any POD or TOD assets. IRA beneficiaries should be designated with a view toward rolling over and/or stretching out IRA distributions.

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