RJP Estate Planning

California Trying to Help Its Seniors

Despite earthquakes, forest fires and drought, by the end of 2015, at least 5.1 million persons age 65 and over will make their home in California by the close of 2015.  Combine the impact of aging baby-boomers with current migration patterns, by the year 2030, the state’s aging population may be as high as 8.4 million. A recent report by the Senate Select Committee on Aging and Long Term Care, A Shattered System: Reforming Long-Term Care in California warns that, “Reliance upon our existing patchwork of programs and services to serve our growing aging and disabled population will result in unnecessary expenditures, inequitable access, and irrelevant services.”

California is trying to make progress in improving the services available to its growing senior population, according to an article in The (Crestline CA) Alpenhorn News titled “Legislative protection for seniors.”

California passed AB 1899 last fall, which required any licensee found to have abandoned residents of a residential care facility to be permanently banned from operating facilities in the state. Also, California legislators passed AJR 29 in 2014, legislation that asked for the restoration of federal funding for senior nutrition programs that had previously been reduced by federal cuts, as well as to exempt these programs from future budget cuts. The federal government’s reply to this request is stalled.

Now California state legislators are considering AB 1122, the “Excluded Persons Administrative Action List,” or “EPAAL” legislation. This bill would require the California Department of Social Services, Community Care Licensing (DSS/CCL) to publish online a list of all persons who are excluded from owning, operating, and/or working inside any licensed care facility as a result of an Administrative Law proceeding. The article notes that right now there’s no mandatory requirement for DSS/CCL to refer elder neglect, abuse, or other egregious behaviors against seniors residing in assisted living facilities to law enforcement, so very few of these crimes are prosecuted. But through Administrative Law proceedings, DSS/CCL can permanently or temporarily prohibit a person from working in a licensed care facility.

The current bill is supposed to provide convenient, online access to EPAAL, allowing everyone to verify that caregivers and the employees don’t have a prior history of behaviors which endangered the health or safety of a senior.

Reference: The (Crestline CA) Alpenhorn News (June 19, 2015) “Legislative protection for seniors.”

For more information on how to set up a proper estate plan, visit us at www.rjpestateplanning.com

Kansas Works to Prevent Elder Abuse

Several Kansas agencies, including The Office of the Kansas Securities Commissioner (KSC), the Kansas Department for Children and Families (DCF) and the Kansas Department for Aging and Disability Services (KDADS) have partnered to recognize World Elder Abuse Awareness Day (WEAAD).  WEAAD is presented by the International Network for the Prevention of Elder Abuse and the World Health Organization.  The organization, founded in 2006, focuses on raising knowledge and of how people can prevent elder abuse in their communities.

Elder abuse comes in many forms, The Hays (KS) Post explains in a recent article titled “Agencies encourage Kansans to help prevent elder abuse in their communities.”  Elder abuse can be physical, financial, emotional, neglect, or abandonment, with several types of abuse often inflicted at the same time. Financial abuse is generally the most common form of abuse to elders, and the cost to victims is estimated at $2.9 billion annually.

Investment fraud is an area of concern because the victims can have their life savings wiped out with little or no opportunity to recover. Investment fraud can come in many forms, the article warns. The investment might be deceptive on its face, or it could be a legitimate product or service that’s unsuitable for the senior’s situation.  Other investment problems include unregistered products, outright theft of funds, or products sold by an unlicensed adviser or broker. Investors and caregivers are urged to “investigate before investing” and to call the KSC at (785) 296-3307 to verify if the product and person selling it are legitimate and whether there’ve been any complaints against them.

Studies show that family members and caregivers are guilty of elder abuse in more than half of these cases. Anyone can, and should, report abuse of an elderly person in any of its forms—physical, emotional or financial. Isolation, loneliness and poor health can put elders in a situation of being at greater risk for these scams.

The DCF has really ramped up its focus on fiduciary abuse over the past few years and has a staff auditor dedicated to pursuing financial exploitation of vulnerable citizens with the help of law enforcement.

“It is the responsibility of every Kansan to report suspected abuse,” DCF Secretary Phyllis Gilmore said. “We strive to work closely with law enforcement and other agencies to protect vulnerable adults.”

Reference: The Hays (KS) Post (June 20, 2015) “Agencies encourage Kansans to help prevent elder abuse in their communities”

For more information on how to set up a proper estate plan, visit us at www.rjpestateplanning.com

Defining Your Legacy

Baby boomers are more concerned with funding their retirements than leaving financial inheritances to their families and charities.  While this may have been initially driven by the Recession, remember that this generation re-defined everything from music to social mores.  The boomers are at it again: redefining what it means to leave a legacy after they are gone.

However, money isn’t the only definition of legacy, according to the US News article titled “How Boomers Are Redefining 'Legacy.'” Baby boomers realize that their top priority is to have enough assets to support themselves, but are starting to redefine “legacy” in the process. For some individuals, it means giving away some money now. For others, it’s restructuring some assets to leave a financial inheritance. For most, the process of aligning their assets with their priorities means the opportunity to create non-financial legacies.

Rethink how you label the financial help you're giving now to your next generation. Are you helping them out with college tuition? Helping with the living expenses of a slow-to-launch millennial by having them stay at home or by covering some bills is not uncommon. About 62% of Americans 50 and older are providing financial support to family members, according to a recent study. The study found that the subsidies averaged $15,000 over five years, but also increased with the givers’ resources. You’re allowed to give away $14,000 per recipient, per year, without triggering any tax penalties or disclosures … more than that and the person who gives has to complete a gift tax return. Also, the gift tax is deducted from your lifetime cap on tax-free gifting.

A 529 college saving plan lets grandparents build up provisions for a grandchild’s college education. Another way to redefine “legacy” is to set up your assets to guarantee that your heirs receive at least some type of asset. Be sure to distinguish legacy planning from estate planning, the article says. For instance, some families construct a legacy of memories and real estate by purchasing a vacation property held in a trust and owned equally by all heirs, keeping it intact for at least another generation. It also guarantees that the vacation home won’t automatically be sold as part of the estate.

Baby boomers: it’s really stories and family values children want from their parents—that’s what Boomers say they want from their aging parents. It’s likely that Generation X and millennials will want the same. Discussions about heirlooms with some market value but even greater sentimental attachment, like grandma’s gold wedding band, are great openings for conversations about “values that characterize the family.”

The article also suggests legacy letters that convey your own priorities, point of view, and life lessons for future generations. This gives you the chance to talk about the document. It’s a good way to redefine “legacy.”

Reference: US News (June 18, 2015) “How Boomers Are Redefining 'Legacy'”

For more information on how to set up a proper estate plan, visit us at www.rjpestateplanning.com

No Estate Plan is a Plan Written by the State

 

For more information on how to set up a proper estate plan, visit us at www.rjpestateplanning.com

Most summer plans do not include drafting a will and testament. Mowing a lawn choked with weeds and overgrown with grass is more likely to be tackled than considering your final wishes.  According to the American Bar Association, 55 percent of Americans do not have a will or other estate plan in place when they die. A survey by the online legal service Rocket Lawyer shows that families are equally lax in planning: about half of all Americans with children did not have a will in 2014.  Families with children should balance summertime fun with the sober but necessary task of preparing an estate plan.

The Denver Post says that the consequence of that is there's no guarantee who’s going to get your assets. The article, titled “How estate plans protect family assets far better than a will,”also says that you canbe placing your children at risk. They could end up in Child Protective Services or in the custody of someone you wouldn’t dream of parenting your kids.

"If you don't have an estate plan, you have a 'plan' written by the state," the article states. That means that you're relying on the state to decide what happens with your kids and your assets. It means that your family will be required to go through the courts, and probate may take months or even years, according to the American Bar Association. Most states have waiting periods for creditors to respond and during which the probate estate can’t be distributed—and that's only if an individual's affairs are in order. Anything hairy means delays and more work.

Depending on the state, probate can be expensive. In some states it can cost between 5 to 7 percent of your estate. Similarly, an estate planning attorney’s fees sometimes scare folks away. However, completing an estate plan on the web or through a lawyer who charges only a few hundred dollars to set up a basic will often leaves too much to interpretation.

The article advises you to understand how assets are titled and how beneficiaries are designated—the two most critical and least understood concepts in estate planning.

One more benefit to planning your estate with a qualified estate planning attorney versus a do-it-yourself online form is that your attorney will help you update your plans as laws change and keep in touch with you throughout your life. Your online will won’t tell you if you need a change or modification. You should update your estate plan at least every three years or when you experience a big life event, like a death, birth, marriage, or divorce.

As you live your life, make sure your estate plan reflects the needs and wants of your family.

Reference: The Denver Post (June 15, 2015) “How estate plans protect family assets far better than a will”

For more information on how to set up a proper estate plan, visit us at www.rjpestateplanning.com