Estate planning isn’t only for the wealthy, nor is it a topic people enjoy thinking about. However, the Dallas Better Business Bureau advises consumers that if they own something of value they would like to pass on to family or loved ones at their death, they should create an estate plan.

A 2007 Harris Interactive poll, conducted for Lawyers.com, found that more than half (55 percent) of adults surveyed didn’t have a will. Some of the main reasons for why they didn’t have a will included not wanting to think about dying, not knowing where to start or who to talk to about setting up an estate plan and not believing they had enough assets to need one.

“Those who don’t have a will are leaving it up to the state to decide where their money and children should go if they should pass away,” said Jeannette Kopko, BBB Dallas spokesperson. “While no one enjoys thinking about their death, it’s important to create an estate plan so that assets go to the people you want and your children are taken care of.”

Will
At the very least, anyone who has assets that they would like to pass on to specific individuals should create a will.  A will can allocate assets as well as establish guardianship of children. Most wills have to go through probate after the individual’s death. In probate, a court oversees the payment of any debts and distributes inheritances—the process can last several months.

Living Trust
While a trust might sound like something only wealthy people need, it’s actually a tool for anyone who would like to set conditions on how and when their assets are distributed. A trust can also help reduce the amount of taxes paid on the inheritance and does not have to go through probate—unlike a will. Examples for creating a trust include wanting to give a child their inheritance over time, rather than in a lump sum, and restrict how the money can be spent.

Living Will
A living will provides a way for an individual to communicate their desire for life-saving measures in case they are incapacitated.  In addition to a living will, individuals can also assign medical power of attorney to someone they trust who can further ensure that their wishes are fulfilled.

Many Web sites offer an inexpensive do-it-yourself approach to creating a will; for more involved estates, it’s best to enlist the help of a lawyer. BBB advises researching any estate planning companies or lawyers first at www.bbb.org before paying for assistance.

After creating an estate plan, BBB recommends communicating the terms of the plan with the family members and loved ones it impacts.

For more advice you can trust from BBB on managing personal finances visit www.bbb.org.

Image: tmelaw.net

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Q – My mom’s been thinking about selling her home, which she has maintained even though she is currently living with a relative. After doing some research online, I realized there are some significant tax implications of selling a home, especially when it is mortgage free. Is there a better option to allow her to minimize the tax costs and maximize her assets?

A – The best bet is to have an estate planner review your mother’s specific circumstance and those assets that can be found in her property. However, there are a few options available such as reverse mortgages, trusts, and transfer of assets. Otherwise, at the time of her death, the property will be transferred to the named recipient as outlined on her will. An inheritance and/or estate tax will apply, which can be substantially less than the taxes your mother could pay if selling her home. At that stage, the person responsible for the estate under the will can sell the property to pay for funeral costs, can distribute profits to named family members, rent the home, or live in it themselves. Talk to an estate planner before making any definite decisions about how to handle your mother’s estate!

Sources:
1. ThinkGlink
2. Wikipedia

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Grants for seniors in Dallas are available from the Federal Government and foundations that provide financial assistance for seniors relating to housing, education and more. There are Federal Grants for seniors that cover a number of areas like housing, volunteerism, nutrition and housing.

Popular Federal Grants for Seniors Include:

•    Capital Assistance Program for Elderly Persons and Persons with Disabilities provides funds to provide transportation to elderly persons in areas public transportation services are not available, or when they are inappropriate due to a senior’s physical or mental condition.
•    The Foster Grandparent Program encourages seniors to volunteer in their communities, specifically with special needs children, through funding which is available for seniors 60 and older who have limited incomes.
•    Mortgage Insurance-Rental Housing for the Elderly -  this grant insures mortgage lenders against loss, to increase the number of quality and affordable rental properties available for seniors.
•    Retired and Senior Volunteer Program encourages community service by seniors 55 and older by offering reimbursement
•    Nutrition Services Incentive Program works with the Department of Agriculture to provide nutritious foods to senior meal delivery programs and other nutritional-focused organizations.

To apply for senior grants provided by the Federal Government or foundations, Dallas seniors must write a proposal, demonstrating the benefits that they would receive, or be able to dispense to others were they to become an approved recipient of the grant.

Sources:
1.    LovetoKnow
2.    Foundation Center

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Q – What should be included in a living will and should all seniors have them?
A – A living will communicates a senior’s wishes with regards to their healthcare, to ensure that family and medical practitioners carry them out once they no longer have the ability to voice what they want. Every senior should prepare a living will before their health comes into question, because unfortunately illness just can’t always be predicted.

When creating living trusts and living wills during the process of estate planning, seniors should understand their options and clearly state their wishes when different medical issues occur. In a general statement, seniors can include treatments they would consider having or prefer should specific medical issues arise (for example, chemotherapy to treat cancer); while general statements are not legally binding, doctors will keep them in mind when determining the course of treatment. Advance decisions and advance directives also allow seniors to refuse specific treatments and actions by a medical doctor; for example, refusing life support under any circumstance. When creating a living will, seniors should also appoint an advocate, which can be a family member or caregiver, to ensure that medical wishes outlined in the living will are abided by.

Having a living will ensures that all seniors have a voice, and play a role in their own medical care; even when they are not physically able to communicate their healthcare needs.

Sources:
1.    CNNMoney.com Gerri Willis
2.    Directgov

Image: eHow.com

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2009’s Economic Stimulus Plan brings both good and bad news for senior Americans. While some of the bills President Obama is hoping to have passed by the senate do benefit seniors’ financial needs; there are advocates who fear that the provisions might hurt Social Security benefits and healthcare long-term. The American Recovery and Reinvestment Act (ARRA), recently passed by the House, does includes some senior-friendly elements such as $87 billion to help fund state Medicaid programs; $650 million to continue the DTV coupon program (allowing people to convert from analogue to digital cable); and $500 million dollars has been allocated to the Social Security Administration to process the rise in disability and retirement claims.

According to the Stimulus Plan, unemployed people age 65 and older will be able to retain their COBRA health insurance coverage, so they are not burdened with exorbitant medical costs until they are eligible for Medicare coverage. Healthcare provisions have also been added that will allow medical institutions to store information about senior health electronically to increase senior medical care. However, they also include a controversial component which requires that medical providers choose medical treatments that are cost-effective. While this may help keep seniors’ bills for medical care low, advocates also worry that this will impact the quality of care received by those with Medicare benefits or private insurance coverage.

Obama’s 2009 Economic Stimulus Plan will also put money directly into seniors’ pockets, with eligibility for one time payments for retirees, including $300 for seniors receiving SSI, Social Security, Railroad Retirement and Veterans Benefits.

Sources:
1. Spectrum

2. Bloomberg.com (Betsey McCaughey)
 
3. Associated Press:  (Adrian Sainz)

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Family Matters-Legal decisions

If your loved one is approaching a point where you and your family members decide that they are not able to function independently anymore, you will have many legal issues to discuss. These are a few important points that need to be discussed:

* Who will be in charge of managing your senior’s personal affairs while they are still alive

* Who will manage their personal care, such as In Home Health care, and make medical decisions

*  Arranging for payment of long-term health care

* Protecting the family assets: making sure that the patient’s spouse are adequately protected

* The distribution of the person’s assets on his or her death.

Get an Attorney immediately. The maximum number of planning options will be available while the patient still has the legal capacity to make his or her own decisions. The question of their capacity can be a gray area, and needs to be determined on a case-by-case basis.

If you sit down and discuss these steps with your family before the actual meeting when these issues are discussed, it may alleviate some of the stress involved with discussing these sensitive topics. Being united is always the best way to help your parent, and to keep the peace while going through this difficult time.