Month: August 2021

We fully support learning a new skill. Refinishing furniture? Great! Learning to knit? Awesome! DIY estate planning? Uh oh. 

There’s a learning curve for everything, and for some things that’s ok. The paint drips on the refinished table can be hidden. The sweater you knit that turned out comically too small might be perfect for the dog. But when it comes to your estate plan, DIY mistakes can have a bigger, and sometimes irreversible, impact. Let’s look at some common pitfalls: 

DIY Pitfall #1: Misdiagnosis 

When you need medical care, you don’t self-diagnose and then order up your own treatment. (Well, some people might—much to the chagrin of their physicians—but that’s a topic for another blog.) Generally, we all understand why self-diagnosis (and subsequently misdiagnosis) is a problem. Without the correct diagnosis, you could end up with the wrong treatment. And the wrong treatment could do more harm than good. 

The same is true for creating your estate plan on your own. You could end up with the wrong components, or pieces that are missing altogether. With that said, you might wonder why sites promising DIY legal document preparation are so popular. Like many things in the Internet age, they satisfy the instant gratification we desire. But to understand why that’s not always a good thing, let’s revisit our doctor example.  

There’s only so much your doctor can do for you online. You can schedule a telehealth visit, but there’s a limit to what your doctor can treat without seeing you in person and getting to know you and your health history. A good doctor treats the patient, not just the symptom. Likewise, you need an attorney who will get to know you, your goals, and your circumstances to ensure your estate plan is set up properly and includes all the components necessary to provide the right protection.  

DIY Pitfall #2: Execution 

Let’s say you’re convinced your situation is as cookie cutter as possible. You’re certain using a wizard online to create your estate plan is sufficient. After all, millions of people can’t be wrong, right? 

Wrong. What those millions of people can’t tell you is what happens after they use that online wizard. Turns out the process isn’t as one-and-done as it seems. Unlike e-filing your taxes, you can’t just e-file your estate plan and call it a day. In order for it to be recognized by the court, there’s a process to follow. For example, your documents have to be notarized and signed before a witness. Just when you thought you could do it yourself, suddenly there are more costs and people involved than you’d planned for. 

Procedure aside, let’s not forget there’s also the risk of invalidating your will through mistakes that are hard to spot if you’re not a legal professional. Legal language can be tricky and the wrong wording can cause headaches down the line. Plus, laws vary from state to state and change all the time. It’s impossible to stay on top of these things unless it’s literally your job to do so.  

DIY Pitfall #3: Support 

That’s the perfect segue into pitfall #3: support. Knowing that laws constantly change, the plan you have today may need modifications in the future for that very reason, or any number of other reasons—like life changes, family changes, or financial changes. The point is that plans can become outdated. They need to be revisited periodically. Ideally, you have someone you can count on to ensure that happens. 

At AlerStallings, we offer lifetime support for every plan we create. That means providing complimentary meetings—including annual update meetings—and no-fee phone calls. The relationship doesn’t end when you sign the plan. We’re with you however life changes, serving you with heart. Our duty is more than just ensuring that you and your family have a plan that protects you today; it’s also to ensure that you continue to have a plan that protects you in the future. It’s service we hope gives you greater peace of mind and more time for the things close to your heart—like those DIY pursuits.  

We’re here for you.  

Call us at (614) 654-5860 to schedule your complimentary consultation.  

Help Make a Difference in this Year’s Walk to End Alzheimer’s® 

The fight against Alzheimer’s is one we take to heart. That’s why we’ll be walking in this year’s Walk to End Alzheimer’s® to bring us one step closer to a cure. But we need your help. 

Columbus Walk to End Alzheimer’s® 

Sunday, Sept. 26, 2021

Columbus Commons

1670 S High St

Columbus, OH 43215

Registration at 12 p.m.

Ceremony at 2 p.m.

Walk at 2:15 p.m.

View our team page to join us or donate!

Whether you choose to walk and fundraise with us or donate to the cause, every little bit makes a difference. We know this because we’ve seen the resources Alzheimer’s requires—from the medical costs to the time loved ones provide in unpaid care—and the impact is immense. That doesn’t even include one of the biggest impacts of all—the toll on the emotional well-being of patients and their loved ones—which is impossible to quantify. The Walk to End Alzheimer’s® funds critical support that addresses all of these, as well as research that’s providing hope for the future for our clients and for the generations that succeed us. 

No one should walk alone in the fight against Alzheimer’s, which is why we’ll be walking in honor of all our clients who have been affected by this disease. Here’s how you can join us: 

Become part of our team, Heart & Sole, and help raise funds for the Alzheimer Association. It’s free to participate and people of all ages and abilities are welcome. This year’s walk will be held in person with COVID-19 safety measures, but there will also be a walk from home experience if you prefer.

-or- 

Donate to help us reach our fundraising goal. Even if you are located outside of Central Ohio and unable to join us for the walk, a donation will go a long way in helping us reach our goal. All funds go directly to the Alzheimer’s Association and are tax-deductible as allowed by law. 

The Walk to End Alzheimer’s® is the world’s largest fundraiser for Alzheimer’s support, research and care. The teams participating in Ohio’s walk have set a goal to raise $750,000. With your help, we can make it a reality. 

And Better Yet, It Ought To Come Free

Do you know what your estate plan is missing?  We’ll give you a hint…  

Think about the people who provide some of the most critical services in your life—like an excellent physician, a reliable dog sitter, or even a beloved hairstylist. What do these all have in common? They don’t serve you transactionally. They’ve formed relationships with you. They’ve earned your trust by giving you the support you need. 

So why is it that when it comes to one of the most critical services of all—estate planning—your estate attorney interacts with you transactionally? They create a plan and bill you for the work. Then, most of the time, you never hear from them again. It really doesn’t make sense, does it? 

Now back to our question above. If you haven’t already guessed, the answer is support. As in lifetime support. Your cardiologist doesn’t perform your heart surgery without any follow-up. Likewise, your attorney shouldn’t create your estate plan without any follow-up either. Here’s why that’s important: 

Because life changes

And when it does, your estate plan might need to as well. You need someone who’s familiar with your circumstances, as they’ve changed over time, and won’t miss a beat.  

Because you’ll have questions 

And when you do, you shouldn’t have to worry about whether you should ask because the simple act of picking up the phone might trigger a bill. 

Because you don’t know what you don’t know

And it helps to have someone check in with you and flag anything you might not have known about that could necessitate an update to your estate plan. 

Because the unexpected happens

And when it does, you want a familiar voice on the other end of the phone, not someone who asks, “Who is this again?” 

The cost of not having lifetime support isn’t just emotional; it can also add up financially. Consider an outdated estate plan. It may contain critical omissions or provisions that are no longer applicable. Dealing with the effects of this could cost significant legal feels or time in probate court. Or, in the example of long-term care, if the estate plan hasn’t been updated to plan for the cost, you could risk losing your home or savings to nursing home fees. All of these instances are entirely preventable. 

Providing lifetime support may not be par for the course at most law firms, but it’s something that’s important to us at AlerStallings. Every estate plan we create for our clients includes annual reviews and questions answered year-round for the rest of your life. We do this because good estate planning should never be transactional. You deserve to have someone who’s with you every step of the way.

These Four Examples Are Completely Avoidable 

We may not have control over everything in life, but when it comes to estate planning, there’s a vast toolbox available to ensure that you don’t become the next cautionary tale. Yet somehow, despite ubiquitous stories about the guy who lost everything, or the family in shambles, many people don’t recognize estate planning as the way to prevent these things from happening. Let’s take a look at four of the most common consequences you can avoid with good estate planning:  

 1. Having no say in major medical issues

It’s a common misconception that estate planning is something you don’t have to worry about until you have kids. Consider this example: Imagine you have a college-aged child away at school who suffers a serious accident. They’re taken to the hospital, but the hospital won’t talk to you because your child is no longer a minor. It’s an unthinkable situation, but it can be prevented with a healthcare power of attorney. It should be part of every kid’s off-to-college planning, ranking right up there with finding the perfect twin extra-long bedding for their new dorm. 
 

But perhaps you’re past that phase, with adult children who have families of their own. There’s still reason to be concerned. But now, the concern pertains to who will make decisions for you in the event of cognitive issues. Without a healthcare power of attorney for yourself, that could be a court.  

The bottom line? Every adult in your family—no matter their age—needs a healthcare power of attorney.  

2. A court making the important decisions

Maybe you don’t care what happens to your potholders, but surely there are some things you’d like to see in the hands of a specific loved one, like a treasured collection or a family home. However, without a will, the only guarantee is that a court will get to decide. Surely that’s not what you had in mind. 

What about minor children? The court would decide that, too. Do you really want that decision in the hands of strangers? That’s why it’s critical to have a will. In addition to indicating the heirs of your possessions, a will can also provide direction for who would be the guardian of your children and who would oversee their financial estate (which can be the same person or two different people).   

3. A surviving spouse being left impoverished

This is a situation no one wants to imagine, but it happens more frequently than you think. The culprit is long-term care costs. 

While you don’t need to assume you, your spouse, or both will go into a nursing home, you’d be wise to plan for the possibility. That’s because statistics show nearly 70% of the 65-and-older crowd will need some form of long-term care. And the cost is staggering, with a private room in a nursing home averaging over $7,500 per month. Because the figures are so overwhelming—and long-term care insurance so expensive and difficult to find—many people choose to bury their heads in the sand instead of creating a plan. Or, perhaps they’ve visited an estate planning attorney in the past but have a type of trust that offers no protection against long-term care costs, such as a revocable trust (also known as a family trust).

So how can you ensure that a surviving spouse doesn’t lose their home, or suffer a precipitous decline in their standard of living to pay for long-term care? The answer is an asset protection trust. When put in place at least five years prior to when you might need care, assets placed in the trust will be shielded from nursing home costs. It could be the difference between losing your home and keeping it in the event of the worst. 

4. Your family being left with a huge tax bill and disagreements

When we pass away, we’d like to think we leave our loved ones with warm memories of our time together. But unfortunately, without an estate plan, sometimes those warm memories are accompanied by big headaches—like infighting and unexpected tax bills. 

As we mentioned in the second point, a will can solve arguments about who receives what by clearly outlining your intentions. But a will can’t address the other source of angst: the widow and kiddo penalties. 

The widow penalty refers to the change in tax filing status that happens when one’s spouse passes away. The surviving spouse then files at the single rate, which will yield a significantly higher tax bill than married filing jointly. The effects can be minimized with advanced planning. A good estate planning attorney should have you consult with an experienced retirement planner who will help you develop a de-tax draw strategy for your retirement accounts and can advise on whether you ought to consider converting any IRAs to a Roth IRA to take advantage of your married filing jointly rate. 

A good estate planning attorney will also have you work with a retirement planner to avoid the kiddo’s penalty. That’s when your adult children or other loved ones pay taxes on your inheritance at a higher rate than the one you enjoy in retirement. Why does this happen? Because they’re in their peak earning years, and likely at the highest tax bracket of their lives. A retirement planner can help you devise a sound gifting strategy and help you adjust it accordingly if tax law changes over time. 

While it may seem inconsequential to put off creating or updating your estate plan for one more day, the consequences of being caught without the right plan in place are anything but. Don’t go another day without the protections in place that you and your family need. We’re here to make the process painless and support you every step of the way. Schedule a complimentary phone consultation to learn more. 

When you envision what you might spend money on in your golden years, does the image include travel, spoiling your grandchildren, or perhaps indulging in a hobby? What about long-term care? If you’re like most retirees, that last one wasn’t what you had in mind.  

Nobody wants to plan for long-term care, but what’s worse than having to think about the possibility is not being prepared for it. That’s why we created this post with sample questions for your estate planning attorney and tips to make the discussion a little easier. Now you can spend less time worrying about the “what ifs” and more time enjoying the good stuff.

When it comes to planning for long-term care, you’ve got options. Here’s what we’ll discuss: 

Government benefits

Self-funding 

Insurance 

Legal tools such as asset protection trusts 

Government Benefits

There are some government programs that may provide assistance with long-term costs if you qualify. We’ll break them down below. But before we do, we should address what you might have noticed is missing from the list: Medicare. That’s because Medicare will only pay for some home or nursing home care so long as it’s rehabilitative and not long-term.   

Medicaid & PASSPORT: Medicaid is the primary payer of long-term care in the country. This state-based program is available to those who have limited resources and fall below a set threshold for income and assets based on federal poverty guidelines, which means qualifying can be difficult. Plus, there are nuances that could make your eligibility less straightforward. For example, a healthy spouse may be able to keep some assets to live on without disqualifying the spouse in need of care from receiving benefits. And here in Ohio, it’s possible for people whose assets exceed the Medicaid threshold to qualify for a PASSPORT waiver—enabling in-home or assisted living care—by transferring assets into an asset protection trust, which is Medicaid exempt. We’ll expand on that under Legal Tools below.

VA: Veterans and their spouses may qualify for The Department of Veterans Affairs’ Aid and Attendance benefits, which can help pay for long-term care needs. This benefit provides monthly payments in addition to your pension for use toward assisted living costs. Note that you must be 65 or older, meet certain service requirements, and have income and assets below limits set by the VA, in addition to other eligibility factors. 

What to ask: 

How do I determine if I’d qualify for government benefits? 

If I do qualify, would the benefits cover the cost of care? 

Self-funding

Self-funding is just as it sounds: you’ll pay the tab and assume full risk for the cost. Because the cost of long-term care can vary widely, so too can the outcome. Since there is no risk-sharing, if the costs of care exceed what you’ve saved, you’re still on the hook. Alternatively, if you’re lucky enough to not need long-term care, the worst that happens is you’ve built a sizeable nest egg.  

In order to shoulder the cost of self-funding, you must have the financial resources to accommodate both an expensive extended long-term care stay and your retirement goals. Keep in mind that according to LongTermCare.gov, the average cost of one year of care in a nursing home with a private room is $92,376 and the average stay lasts three years.  

What to ask: 

What is at risk if I decide to self-fund? 

How much should I have saved to meet my goals? 

Insurance

Chances are you’ve heard of long-term care insurance. After all, it’s been around for decades. If you’ve also heard it’s expensive, then you’ve heard right. As people live longer, the cost and duration of care has risen, making it a losing proposition for insurance companies. For this reason, long-term care insurance isn’t as widely offered anymore and has risen tremendously in cost, making it unaffordable for most.  

Before you eliminate insurance as an option, be sure to check your life insurance policy, which may offer a valuable alternative to long-term care insurance if it allows for Accelerated Death Benefits. Policies with Accelerated Death Benefits provide a tax-free advance on your life insurance death benefit while you’re still alive to help with the cost of long-term care. The cap is usually around 50% of the death benefit, with monthly benefits around 2% of the policy’s face value for nursing home care, and half that for in-home care. 

What to ask: 

Would I be better off paying for long-term care insurance or investing the money? 

What are the limitations of Accelerated Death Benefits? 

Legal Tools

When it comes to reducing your risk, estate planning and elder care law attorneys offer a wealth of resources. One such resource is an asset protection trust, which we mentioned above. In an asset protection trust, ownership of your assets and property are transferred to the trust, effectively shielding your estate from creditors. This can help some individuals qualify for Medicaid or preserve a portion of their estate or property for their loved ones.  

It’s important to note that this is a proactive measure that requires some forethought. That’s because Medicaid has a five-year “look back” period. Any property or assets that haven’t been in the trust for at least five years could disqualify you from benefits. That’s why it’s especially important to work with an experienced attorney who can help you understand your options and ensure that your trust is set up properly. 

What to ask: 

Would I be a good candidate for an asset protection trust? If so, when is the right time to put one in place? 

Are there any other estate planning tools that might be beneficial for my circumstances? 

Planning Your Next Steps

While there is no one-size-fits-all approach to planning for long-term care costs, we hope this post has helped demystify the options and illuminate what may be the best fit for you. As you consider your next steps, we urge you to enlist the assistance of a qualified estate planning attorney. At AlerStallings, we know that choosing an estate planning attorney is a highly personal decision, and that’s why we offer a no-cost, no-commitment consultation so you can get to know us. After all, we’re with you for life. This is a partnership that starts from the heart. 

We’re Here for You.

Call us at (614) 798-9800 to schedule your complimentary consultation.