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Massachusetts Estate Planning Law Blog

Estate planning: A chronic illness may prompt a sense of urgency

The belief that time is on their side may lead many individuals in Massachusetts into delaying the process of planning for the future. However, for those who live with a chronic illness, the reality that time is finite may prompt a sense of urgency toward seeking guidance on available estate planning options. With a variety of factors to address in developing a plan for the future, seeking guidance early in the process could prove imperative.

Studies indicate that by the start of 2020, the number of Americans who live with a chronic illness will reach nearly 160 million. Experts indicate that there are a variety of vital factors to address when facing a similar circumstance. For instance, providing another party with access to personal health information through a HIPPA release form can be a complex process, but it may also prove essential in the event of serious injury or incapacitation.

You don't have to save your gifts for after your death

If you are like others here in Boston, or elsewhere for that matter, you may believe that you should save inheritances for after your death. When you begin your estate planning process, you consider the gifts you want to give to those you love.

While that is a goal of estate planning, it might not be the best option. Perhaps your estate will exceed the estate tax exemption, which would mean owing money in taxes that will diminish the value of the inheritances you want to leave. On the other hand, those you love may need their inheritances now instead of later, and you want to help them.

Sudden wealth may alter estate planning preferences

There are a variety of circumstances in which a person in Massachusetts or elsewhere may encounter a sudden and substantial increase in wealth. While this may seem like a dream come true for many, those who experience a significant increase in financial standing may also have a great deal to consider when planning for the future. Sudden increases in wealth could change a person's estate planning preferences considerably and taking steps to update one's plans and protect his or her financial future could prove essential.

In some cases, individuals who experience a substantial increase in wealth might not be fully prepared to handle such a financial obligation. Some of the potential risks involved with sudden wealth include a higher potential to make hasty financial decisions. Those who receive such wealth through an inheritance may also encounter feelings of guilt and stress and feel led to distribute a significant portion among family members or donate portions to charity.

Updating an estate plan after a gray divorce

According to studies conducted by the Pew Research Center, overall divorce rates have gone down in the United States. Despite this, studies show that the rate of divorce for couples over the age of 50 has almost doubled since 1990.

These divorces typically present challenges that younger couples may not have to face. For example, you may have a more complicated and interwoven estate plan than a younger couple would. Here are a few estate planning steps you should follow when going through a gray divorce.

Removing uncertainty by asking questions about estate planning

Many individuals in Massachusetts and elsewhere may feel that one of the most intimidating aspects of planning an estate pertains to considering the unknown. The prospect of asking questions about what will happen should one become incapacitated or pass away can seem a daunting task. However, asking and answering certain estate planning questions could help alleviate a great deal of uncertainty.

One of the most intimidating questions to consider may pertain to what will happen to the kids after one passes on. While this might seem difficult to think about, asking this question could be the first step toward considering each available option to help protect their interests and needs. Those who have assets they wish to distribute among their loved ones may also fear that this process will lead to conflict and taking steps to reduce the likelihood of such a dispute could prove vital.

Seeking advice on the benefits of establishing a trust

There may be a multitude of individuals who are under the impression that certain estate planning options are only beneficial for the wealthy. Unfortunately, this common misconception could lead some into choosing to avoid the process altogether. By seeking guidance on all the possible benefits of setting up a trust, individuals in Massachusetts may become better prepared to make informed decisions about the future of their estate.

There are a variety of potential benefits of establishing a trust. For instance, a trust can act as a tool to help manage asset distribution and prevent lapses in judgment from proving detrimental to beneficiaries. The assets within a trust may also benefit from protection against creditors should beneficiaries fall behind on monetary obligations. There may also be a variety of possible tax benefits to setting up a trust.

Trust: Considering the options with changes on the horizon

Many individuals in Massachusetts and elsewhere may consider it vital to have a strategy in place to provide their loved ones with the necessary support after they pass on. In some cases, a person may have the option to use assets stored within an IRA to provide support to beneficiaries for extended periods of time. However, with changes to the rules that govern inherited IRA accounts on the horizon, those who wish to plan for the future may find it advisable to seek guidance on other estate planning options, such as setting up a trust.

According to reports, the U.S. House of Representatives recently voted in favor of legislation that will place a time constraint on what is known as a stretch IRA. Over previous years, beneficiaries of a stretch IRA were able to receive funds from the account while benefiting from tax deferral for extended periods. However, once the bill goes into effect, a provision will require certain beneficiaries to distributed the assets within an inherited IRA within a decade of the owner's passing.

Estate planning: Keeping digital assets in mind

In a digital era, it is becoming more and more common for individuals in Massachusetts and elsewhere to store a significant portion of their information online. Although there may be a variety of estate planning options that cover how digital assets will be handled, this part of the process could go overlooked at times. Those who wish to gain a better understanding of how to incorporate these assets into their estate plans could benefit from obtaining insight into what constitutes a digital asset.

Digital assets can come in a variety of forms, ranging anywhere from email and social media accounts to websites. These can also include assets such as photo collections or videos that are stored online. Online bank accounts or book collections stored on internet applications can also be considered as digital assets, as can monthly memberships or subscriptions that are paid for with credit card information stored online.

Myths about estate planning may create unnecessary hesitation

There may be many individuals in Massachusetts and elsewhere who place a high level of importance on planning for the future. However, when it comes to making plans for what happens after one is gone, the process may appear somewhat more intimidating. There are also certain myths about estate planning that may create unnecessary hesitation, and debunking these misconceptions could prove essential to making informed decisions.

One of the most common myths about estate planning is the idea that such a strategy is only beneficial for the wealthy. There are a variety of potential benefits of planning an estate, some of which might not involve the process of distributing assets. Some of these benefits include the ability to appoint someone to act as guardian for the kids in the event of death, and the option of setting guidelines on the type of medical care one will receive in the event of an emergency.

Trust: Protecting the future of the kids as a single parent

There may be a multitude of single parents in Massachusetts and elsewhere who consider it vital to have a plan in place to protect the needs of their children. While certain scenarios could be difficult to think about, having a strategy concerning how to provide for the kids in the event a death occurs could prove imperative. Single parents who wish to implement such a strategy could consider setting up a trust, but many may be unaware of the potential benefits this estate planning tool can offer.

A trust is an estate planning option that can provide a variety of possibly beneficial options. For instance, if the other parent is deceased or is unable to serve as custodian for the kids, a person can use a trust to appoint another party as a guardian. One can also set forth terms concerning visitation rights and set guidelines concerning who will have the authority to make major decisions about the future of the kids.

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