Monday, June 1, 2009

Trying to Plan an Estate Around Specific Assets

Unless there are compelling reasons why a specific asset should go to a specific person, it is strongly discouraged to plan around specific assets. This is be called the “Ironing Board Will”

The problem: Including all specific assets in a will or trust, (even the ironing board hence “ironing board will”) to go to specific persons, there are chances that such assets will get lost or be disposed of by the time of death and it makes the Trustee or Executor responsible to the beneficiaries to find the assets or explain why they are not in the estate.

More practically if a estate plan is based on a division of specific assets to specific beneficiaries, if some are sold before death then the estate plan can become unbalanced and could result in an estate plan that was different than the intent of the decedent.

It is usually better to leave a limited amount of assets by specific bequest and the rest by way of a percentage of the estate.

Joseph E. Deering

632 Arizona Avenue
Santa Monica, California 90401
Telephone (310) 393-0701

Monday, May 4, 2009

Failure to Understand How Your Assets Will Pass On Your Death

Most People think that their property will pass by a will.

This usually is wrong. In most estates property passes by a variety of methods:

  1. Joint Tenancy—A method of holding property which automatically gives the property to the survivor regardless of the will says.
  2. Life Insurance—Gives the policy to the beneficiary unless the owner of the policy is married and then it will go one half to the surviving spouse regardless of what the owner wishes in California
  3. Pay on Death Bank or Stock Accounts (Totten Trusts)will automatically go to the beneficiary on the account regardless what the will states.
  4. IRA and other Retirement Accounts—will go to the beneficiary and if there is no beneficiary listed then it will go to whoever is designated in the retirement plan. This could be the estate or someone else—such as a spouse or child
  5. Property funded in a Trust—Will go to the beneficiaries of the trust regardless of what the will says
  6. Community Property—In California regardless what the will says only ½ of the community property will go the way the married person states in a will. The other ½ will go to the spouse

Usually only property which is titled in you name alone if you are single will go by way of the provisions of a will.

Joseph E. Deering

632 Arizona Avenue
Santa Monica, California 90401
Telephone (310) 393-0701

Monday, February 9, 2009

Family Loyalty out the Window

So what do you think?
In Mr. Condon's Living Trust, he provided that his grandson, Jeff, would get $150,000 on his death if the grandson had reached age 25. He also provided that if his grandson was not 25 at the time of his death, his son, Milton, would be appointed as the after-death agent to manage the $150,000 and deliver it to Jeff when he reached that age.

Jeff was 19 when his grandfather died. In accordance with his grandfather's Living Trust instructions, his father, Milton, secured the funds.

Fast-forward to six years later when Jeff finally turned 25, I noticed in my appointment book that Jeff had made an appointment to see me. In reviewing his grandfather's trust, I was reminded about the gift provision to him. Therefore, I assumed that Jeff wanted to meet with me for advice on the transfer of that gift to him. As I met Jeff in my waiting room, I said, "Happy Birthday! What's the first thing you are going to do with your gift?

He responded, "Sue my father!"

In my office, Jeff explained what he had meant by such a shocking statement. Upon turning 25, he approached his father for the money. When he did, his father said, "Hey, son, since my money is family money, your money is family money. You've been receiving your distribution all along in the form of food, clothing, and shelter."

Mr. Condon wanted his grandson to have that bequest to help him get a leg up in life: to start that family, buy that home, establish that business. What his grandson got instead was a lesson in the school of hard knocks. When it comes to money, family loyalty goes out the window.

Thanks to: Jeff Condon, Trust Law Adviser, Wiley and Sons, 2008

Joseph E. Deering

632 Arizona Avenue
Santa Monica, California 90401
Telephone (310) 393-0701

Holiday Blues - Depression in the Elderly

The holiday season is here. If you are a caregiver for an elderly loved one, you may notice a change in your loved one's mood as the holidays approach. Perhaps you are one of many, who visit elderly parents and family during the holidays who live a distance away. When you visit you may notice that loved ones are not as physically active, or they show symptoms of fatigue or sadness and have no interest in the holiday or in their surroundings.

According to the National Institutes of Health; of the 35 million Americans age 65 or older, about 2 million suffer from full-blown depression. Another 5 million suffer from less severe forms of the illness. This represents about 20% of the senior population -- a significant proportion.

Depression in the elderly is difficult to diagnose and is frequently untreated. The symptoms may be confused with a medical illness, dementia, or malnutrition due to a poor diet. Many older people will not accept the idea that they have depression and refuse to seek treatment.

What causes depression in the elderly?

It is not the actual holiday that causes depression, but the fact that holidays tend to bring memories of earlier, perhaps happier times. Additional contributing factors that bring on depression may be the loss of a spouse or close friend, or a move from a home to assisted living, or a change with an older person's routine.

Depression may also be a sign of a medical problem. Chronic pain or complications of an illness or memory loss can also cause depression. In addition, diet can also be a factor when proper nutrition and vitamins are lacking.

As an example, Selma's husband passed away, a few months before Christmas. Her family lived close by and would call or drop in often to check on her. Selma seemed a little preoccupied and tired, but this was to be expected as she had been the caregiver for her husband for many years. It wasn't until the family noticed that her holiday decorations were not out and her yearly routine of Christmas card writing was not happening that they began questioning her mental and physical well being.

A trip to her physician confirmed depression, caused by not only the loss of her spouse, but a vitamin B12 deficiency. There were both mental and physical reasons for her depression.

Symptoms to look for in depression might include:

  • Depressed or irritable mood
  • Feelings of worthlessness or sadness
  • Expressions of helplessness
  • Anxiety
  • Loss of interest in daily activities
  • Loss of appetite
  • Weight loss
  • Lack of attending to personal care and
  • Fatigue
  • Difficulty concentrating
  • Irresponsible behavior
  • Obsessive thoughts about death
  • Talk about suicide

Treating the holiday blues in seniors.

Get the senior involved in some social or other types of activities. The elder person generally denies any problems or may fear being mentally ill. You can make the difference in and remove the Holiday Blues from seniors suffering from depression. For example, get them involved in an art project which can be a valuable asset for improvement.

The Senior Arts Foundation at Santa Monica is a community based organization to connect seniors to the arts. It acknowledges the excellence of artworks produced, appreciated and collected by seniors. The SAF recognizes the talents of these older adults and aims to expand their horizons into all aspects of the arts. It provides a vehicle to express their artistic vision and support their artistic talent.

For more information, see these sites:

Joseph E. Deering

632 Arizona Avenue
Santa Monica, California 90401
Telephone (310) 393-0701