Wheatley Pritchard & Associates PLLC

5 common estate planning mistakes that families make

2025-08-24T22:51:38Z

Estate planning is important for the protection of individuals and their family members. The right documents allow a person to leave a positive legacy. They can also secure protection for themselves in emergency scenarios and provide support for their dependents even after their death. However, mistakes during estate planning are relatively common. When a family depends on the security provided by an estate plan, avoiding common mistakes is of the utmost importance. The five following common mistakes are easily avoidable with the right support.

1. Indefinitely procrastinating

A surprising number of adults do not have any estate planning documents in place. They keep waiting for some future event to draft their documents. They may eventually die without an estate plan, leaving their loved ones scrambling and potentially unprotected.

2. Failing to keep documents updated

Drafting a will and other estate planning documents is a critical step in the right direction. However, people often overestimate how long those documents adequately meet their needs. Testators may want to review their documents every three to five years to account for any changes to their families, personal holdings and medical circumstances. Updates are also necessary after major life events, such as divorce, marriage or the birth of a child.

3. Failing to name contingent beneficiaries

Testators typically want to provide specific assets for each of their chosen beneficiaries. However, the potential exists for beneficiaries to die just before or at the same time as the testator. Including contingent beneficiaries to inherit the assets intended for a deceased beneficiary is an important estate planning step that many people overlook.

4. Only planning for death

An estate plan can control what happens with personal property after an individual dies. It could also include documents that protect people in emergency circumstances. Expanding an estate plan to include powers of attorney, advance directives and other living documents can help people connect with support if they experience personal emergencies.

5. Leaving direct inheritances for the wrong parties

Minor children, pets, people in unstable marriages and those with special needs may be among the pool of intended beneficiaries for an estate. They are also vulnerable to poor outcomes if they receive a direct inheritance. Assets could be vulnerable if beneficiaries divorce or could be under the control of a parent or guardian. Other times, an inheritance could cut an individual off from state benefits. Creating a trust is often helpful for those who want to provide support to companion animals or loved ones in challenging situations. Testators who learn from the mistakes of others are in a position to create authoritative, helpful estate plans. Drafting and occasionally revising estate planning documents can give people peace of mind and protection in challenging situations.

Estate planning for blended families

2025-06-24T17:58:37Z

Blended families are increasingly common, often fostering love, growth and complexity in familial relationships. As a result, when it comes to estate planning, the unique structure of blended families requires thoughtful attention. If you are a parent who navigates a blended family structure, know that planning ahead can help you to better ensure that your wishes are honored, and that all family members—biological children, stepchildren and/or a surviving spouse—are treated fairly and in accordance with your intentions.

Important considerations to keep in mind

When each spouse has children from prior relationships, questions often arise about what each child should inherit and when. Many people want to provide for their surviving spouse but also ensure that their own children are not unintentionally disinherited. Without clear instructions, this balance can be difficult to achieve and may lead to tension or even litigation among family members. Stepchildren can further complicate the picture. Unless a legal adoption has taken place, stepchildren are typically not entitled to inherit by default under state intestacy laws. If you want a stepchild to receive part of your estate, it is essential to state this intention clearly in your will or trust. Failing to do so can leave them vulnerable to exclusion, even if they have played a major role in your life. Trusts are often an effective tool for blended families. For example, a revocable living trust can allow assets to be used by a surviving spouse during their lifetime, with the remainder passing to the children of the first spouse upon the survivor’s death. This approach protects both the spouse and the children, minimizing the risk of accidental disinheritance. However, setting up such arrangements requires careful drafting and full transparency between spouses. It’s also important to revisit beneficiary designations on life insurance policies, retirement accounts and joint assets. These designations override what’s in a will or trust, so they must reflect your current wishes. In blended families, it’s common for people to forget to update these forms after a remarriage, which can lead to unexpected outcomes. Every blended family is different. By working with an experienced legal team, you can create a plan that respects your relationships, protects your loved ones and brings clarity to an otherwise complex situation. With empathy and proactive planning, it’s possible to support your entire family—both now and in the future.

How life insurance can be an important part of your estate plan

2025-04-30T20:49:16Z

People often don’t think of life insurance as being part of their estate plan. However, for many Americans, it’s the first step they may take in estate planning, even if they don’t realize it. Life insurance can help ensure financial stability for loved ones when someone whose income they rely on passes away. People often get their first life insurance policy when they have young children. Later in life, when their kids are independent, people often think they no longer need life insurance. They may think they have a large enough estate to allow their spouse to live comfortably if they die first.

Providing needed funds to cover immediate and short-term expenses

It often takes time for estate assets to be disbursed – even without a long probate process. Unless you add a joint owner to your bank accounts or give them access via a payable-on-death or transfer-on-death designation, your family could end up scrambling to try to pay funeral expenses, hospital invoices, mortgage payments, college tuition and more. Having a life insurance policy that will pay out relatively quickly can help your loved ones financially during an already difficult time.

How else can life insurance help with your estate planning?

A life insurance policy can also help in the following situations:

If many of the assets in your estate will take time to liquidate or get a fair price for (such as real estate, art, vehicles and more)
If there are conflicts or other complications that cause a delay in disbursing inheritances
If you want to provide equal inheritances to your children or a greater inheritance to one child but the assets in your estate are difficult to divide

The two main types of life insurance are term life and permanent. It’s important to learn about them both in order to decide which fits your needs and goals better. There’s also an estate planning tool called an irrevocable life insurance trust (ILIT). This can help minimize the taxable value of your estate and gift taxes on your heirs. ILITs have a number of benefits that are worth looking into. With sound legal guidance, you can better determine how life insurance may fit into your estate planning, regardless of what stage of life you’re in, and better optimize the financial assets you’re able to leave for your loved ones.

Funding Your Child’s Education Through Estate Planning

2025-02-21T12:09:09Z

Planning your child's education takes careful thought and smart financial strategy. Growing education costs mean you need to start planning early and add educational funding to your estate plan. You can create a lasting impact on your child's future by choosing the right educational funding tools and estate planning strategies. Getting a head start on your child's academic future means you must know the estate planning options available to you.

Get started on funding your child's educational future

Your estate plan can include several strategies to ensure your child’s education receives proper funding. These options provide different advantages and can align with your specific goals for your child's education. Consider these educational funding methods:

Educational trusts: These specialized trusts help you set aside money specifically for your child's education while maintaining control over how and when the funds are distributed
529 plans: These tax-advantaged savings accounts offer flexibility and tax benefits when the funds are used for qualified educational expenses
Life insurance policies: These policies can include provisions for educational funding and ensure your child's education continues even if unexpected events occur
Custodial accounts: These accounts allow you to manage assets on behalf of your child until they reach legal age, providing flexibility in educational spending
Gift tax exclusions: Annual gift tax exclusions enable you to contribute to your child's education fund while potentially reducing your taxable estate

Knowing your options can help you make informed decisions about securing your child's education. An experienced estate planning attorney can guide you through these choices and aid you in creating a comprehensive plan tailored to your family's needs. A well-structured estate plan that includes educational funding provisions can give you peace of mind about your child's academic future. Your careful planning today can make a significant difference in your child's educational opportunities tomorrow.

What are the benefits of a trust fund for your children?

2025-01-10T19:46:37Z

Planning for the future of your children involves more than just providing for their immediate needs. Setting up a trust fund is a strategic way to manage and protect their inheritance. Here is how a trust can benefit your family.

Why establish a trust fund?

Creating a trust fund offers several advantages. First, it provides a safety net for your children, especially if they are minors or not yet financially savvy. A trust ensures that a responsible trustee manages the assets until your children reach a specified age. Additionally, a trust protects your children’s inheritance from unforeseen circumstances. For example, if your child faces a divorce or financial hardship, a properly structured trust can shield their assets from claims by others.

Types of assets and tax benefits of trust funds

You can include a variety of assets in a trust. Common options include bank accounts, real estate, life insurance, and retirement accounts. By placing these assets into a trust, you can reduce the size of your taxable estate. This can lead to significant tax savings since trusts often offer exemptions and benefits that can minimize or eliminate estate taxes. To set up a trust, it is advisable to consult with a New York estate planning attorney.

How can a trust fund protect your child's inheritance?

One of the most practical benefits of a trust is avoiding the probate process. Probate can be lengthy, but a trust allows for a more direct transfer of assets to beneficiaries. This means your children can access their inheritance more quickly and without the hassles of court proceedings. Moreover, trusts maintain privacy. Unlike a will, which becomes a public record, the details of a trust remain confidential. Only the trustee and beneficiaries know the contents and terms, protecting your family’s privacy.

Choosing the right trust

The type of trust you choose depends on your goals and your state’s laws. Options include irrevocable trusts, which offer asset protection and tax benefits, and revocable living trusts, which allow flexibility during your lifetime. Establishing a trust for your children is a proactive step in securing their financial future. It offers protection, tax advantages, and privacy, ensuring that your assets are distributed according to your wishes.

Why is Naming a Guardian for Your Child Crucial?

2024-10-31T17:00:16Z

Estate planning is a critical step for your family, particularly when it comes to ensuring the future care of your children. The most important decision in this process is choosing who will raise your children if you and your partner pass away unexpectedly. In New York, if both parents die without naming a guardian, the court steps in to decide who will care for their children. This can lead to lengthy legal battles and uncertainty, potentially causing additional trauma for your children during an already difficult time. By designating a guardian, you provide clarity and peace of mind, knowing that someone you trust will care for your children.

Considerations for naming a guardian

When choosing a guardian, considering several factors can help ensure that the person you select is the best fit for your family's needs. Here are some of the most important qualities to discuss:

Religious and moral values: Make sure your chosen guardian shares similar values and beliefs, ensuring consistency in your child's upbringing.
Physical and emotional ability: Consider the guardian's ability to care for your child now and in the future, especially if your child has special needs.
Location: The guardian's proximity to your home can impact your child's stability, including school and social connections.
Financial responsibility: Decide whether the guardian can manage finances or if you should appoint a separate fiduciary.
Willingness: Confirm the guardian is willing and able to take on this responsibility.

Evaluating these factors can help you make an informed decision that reflects your family's values and needs.

Remember that circumstances can change

Reviewing your estate plan is essential, whether every few years or after major life changes, such as a death, divorce or a guardian’s change in circumstances. This ensures that your plans remain aligned with your family’s needs and any new developments in your life. Regular updates to your estate plan are crucial for safeguarding your children's long-term well-being. An experienced estate planning attorney can assist you in making these decisions, ensuring that your wishes are clearly documented and legally binding. By taking these steps, you can provide your children with security and stability, regardless of what the future holds.

Defining the Legal Relationship Between Grandparents and Their Grandchildren

2022-12-02T15:35:56Z

Raising a grandchild (or even spending a lot of time with your grandchild while his or her parents work) can be fraught with legal and financial complications. Lacking many of the inherent rights parents have, grandparents who are responsible for the care of their grandchildren may encounter unexpected legal challenges. Even if you are your grandchild’s full-time caregiver, consider obtaining certain legal rights so you can avoid unnecessary complications and instead focus on raising a happy and healthy child. If you are raising your grandchild, don’t assume you can make legal decisions on your grandchild’s behalf. Without legal custody, you do not have the authority to make important decisions such as where he or she will go to school. If you are responsible for your grandchild’s care, it’s critical to establish a clear relationship in the eyes of the law. The legal rights you need will depend entirely on your role in raising your grandchild. Does he or she live with you? Are you the sole caregiver? What role do the parents play? Are you financially responsible for your grandchild? Answering these questions will give you a good starting point for seeking the legal rights and protections you need and deserve, which might include: Physical or Legal Custody If you have full-time custody for your grandchild, do you have a custody order? If not, you may want to consider getting one. Physical custody gives you the right to have your grandchild live with you. Legal custody gives you the right to make important decisions pertaining to education and medical care. Your grandchild’s parents may still retain some rights if you have custody. Also, custody orders are subject to modification if and when circumstances change. Legal Guardianship If you care for your grandchild regularly, make sure his or her parents have named both short-term and long-term guardians, so that if anything happens to the parents, you are able to immediately step in and make legal decisions for your grandchild. Adoption Adopting your grandchild would terminate his or her parents’ parental rights. You would become your grandchild’s legal parent, which is preferable in cases where the parents pose a risk to the child or when the child’s parents are deceased or no longer in contact. Adoption is permanent. Power of Attorney If you do not have custody, your grandchild’s parents could give you Medical Power of Attorney, which provides you with the temporary authority to make specific decisions around the health care of your grandchild. The parents can specify what decisions you can make and can revoke Power of Attorney at any point. Power of Attorney does not revoke the rights of the parents. Educational or Medical Consent Some states will grant non-custodial grandparents the rights to enroll their grandchildren in school and seek medical treatment. Speak with us to see if these are options in your state, if you would like to ensure you can make educational and medical decisions. Even something as simple as enrolling your grandchild in school can be difficult if you don’t have the proper legal authorization. If you’d like to simplify decision making while raising your grandchild (or even just full-time caregiving for your grandchild), meet with a Personal Family Lawyer® for guidance. We can help you obtain the rights and protections that will help you raise a happy and healthy grandchild. Our Family Wealth Planning Session™ guides you to the empowered, informed, and educated legal and financial decisions you need for the love of your family. Before the Session, we’ll send you a Family Wealth Inventory and Assessment to complete that will get you thinking about what you own, what’s most important to you, and what would happen to everyone you love and everything you own, when something happens to you. This article is a service of [nap_names id="FIRM-NAME-1"], Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. Schedule a Family Wealth Planning Session here or call our offices at [nap_phone id="LOCAL-CT-NUMBER-1"] and mention this article to find out how to get this $750 session at no charge.

How Can I Plan for a Strategic Retirement?

2022-12-02T15:39:29Z

Are you approaching retirement? Not sure how you can ensure a smooth transition from working life to retired life? Walking away from regular paychecks and employer-provided benefits can feel a little nerve wracking. Minimize the impact of these major life changes by planning accordingly.

Time It

Get your timing right. Review and understand your employer’s policies on 401(k) matching and profit sharing. Make sure you plan to retire at a time when you can reap all the vested benefits you have coming to you before they expire. Sit down with your company’s HR department to maximize your retirement benefits.

Bridge the Insurance Gap

If you are retiring before the age of 65, you could have a lapse in insurance coverage before you are eligible for Medicare. If your employer doesn’t offer retiree health insurance benefits (and most don’t), look into COBRA insurance to extend your current coverage or an individual insurance plan to carry you over until Medicare kicks in. Don’t forget about life insurance and long-term care insurance either. If you do not have an insurance advisor you trust, we can refer you to someone, and we can also provide an objective backstop review on any insurance you do have in place to make sure it’s the right amounts and right types for you.

Petition for Your Pension

Apply for your pension at least five months before you retire. Get a benefits statement, and consider your payout options if you have them (e.g. lump sum vs. annuity). Coordinate your pension payout to minimize your tax liability while still meeting your financial needs.

Rearrange Your Retirement Funds

Consider consolidating accounts and rolling 401(k) funds into an IRA for more investment freedom and easier management. Conversely, some retirees find the investment options with employer-provided 401(k)s are cheaper than those bought independently. Make sure you discuss your options with a financial professional and choose the option that maximizes your income and gives you the flexibility you need. And, of course, ensure your beneficiary designations are set up to make sure your retirement benefits go exactly where you choose

Planning a strategic retirement takes forethought, and don’t short sell yourself on all the perks you may be owed. Make sure you take advantage of all the benefits your employer offers and carefully plan how you will manage your retirement income to minimize tax liabilities. Following these simple steps can help ensure you are financially prepared for retirement.

If you are nearing retirement, consider sitting down with a Personal Family Lawyer®. As your Personal Family Lawyer®, we can help you strategize your retirement to reap maximum benefit before you retire. Before the session, we’ll send you a Family Wealth Inventory and Assessment to complete that will get you thinking about what you own, what matters most to you, and what you need to do to preserve your financial well-being and retire comfortably.

This article is a service of [nap_names id="FIRM-NAME-1"], Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. Begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.

#Saving #Retirement #finances

When Duty Calls: Navigating the Sandwich Generation with Ease

2024-11-04T14:14:29Z

The average age of parents raising children in the US continues to rise, leaving many middle-aged Americans in a category commonly referred to as the the “sandwich” generation. This growing population of professionals are often still raising kids at home when they become responsible for the care of their own aging parents. The stress and financial strain of managing the affairs of both children and parents can become overwhelming. The following tips can help make this challenging life stage manageable and more enjoyable. Assess the Financial Situation Taking time to thoroughly understand the financial picture for your own household is imperative as you step into a role of responsibility for your aging parent. Prepare for the inevitable and avoid surprises by working with a professional to consider how your role in the care of your parent will affect the plans you are making for your family’s financial future. Take advantage of our Family Wealth Planning Session process, a comprehensive planning process that ensures your legal, financial and insurance needs are covered appropriately. Plan Ahead Benjamin Franklin is quoted as saying that, “Failing to plan is planning to fail.” Planning for your family’s future means preparing for the worst and hoping for the best. As you move through helping your aging parent with important Estate Planning decisions, take time to be sure your own wishes are legally binding as well. Be sure to include:

Medical power of attorney - appoints a person to make medical decisions if you are unable to do so
Durable power of attorney - designates a person to make financial decisions if you are unable to do so
Living will - expresses your wishes for end of life decisions
Will - carries out your wishes in the event of your death
Kids Protection Plan - designates a legal guardian for your minor children in the event of your incapacitation or death

Pay Attention to Red Flags Even if your aging parent is still quite capable, work together to assess their financial situation carefully and be on the lookout for signs that anything is falling through the cracks. Common red flags are:

Frequent calls from creditors
Forgetfulness when it comes to bills and deadlines
Unopened mail

Utilize professional legal and financial support when necessary and communicate clearly so everyone knows who is responsible for what. Practice Good Self Care Stress is one of the most common consequences of caring for two generations at once. Balancing the responsibilities of raising children and caring for aging parents with relaxation and play is vital over the long-haul. Remember that adequate rest and good nutrition will provide you with the extra energy you’ll need when times get tough. Most importantly, remember that you don’t have to do it alone! As your Personal Family Lawyer®, we are ready to assist you when duty calls. Now is the perfect time to schedule a Family Wealth Planning Session, where we’ll review your current financial situation in light of your future responsibilities. With our assistance, you’ll gain the confidence of knowing you’re making the most empowered, informed and educated legal and financial decisions for yourself and the ones you love. This article is a service of [nap_names id="FIRM-NAME-1"], Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. Begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge. #EstatePlanning #Incapacity #eldercare #children #Family #finances

Think Your 401(k) Is Flexible? 6 IRA Benefits Your 401(k) Doesn’t Have

2024-10-03T16:47:39Z

When it comes to retirement plans, IRAs and 401(k)s provide many of the same benefits. But in certain situations, an IRA can outperform a 401(k). IRAs aren’t right for everyone, so you should become familiar with the advantages IRAs have over 401(k)s before you transfer funds or set up a new account. To help you do this, here are a few benefits you can reap from an IRA not available in a 401(k).

Qualified Charitable Distributions (QCDs)

IRAs allow you to take QCDs and send them directly to the charity without including the distribution amount in your taxable income. This often results in a lower tax bill. You can also use your QCDs to offset your required minimum distribution.

Penalty-Free Distribution for Higher Education

A 401(k) distribution for higher education expenses will incur both a tax and a penalty. Taking an early IRA distribution to pay for higher education expenses for you or certain family members is penalty-free.

Freedom from Distribution Restrictions

Opportunities for early distributions of 401(k)s are limited at best. Subject to the plan administrator’s rules as well as the tax code, 401(k)s require a compelling reason such as a hardship, to receive an early distribution. Conversely, IRA distributions are restriction free. You can take an IRA distribution at any time and do not need an approved reason like 401(k)s.

Aggregate Required Minimum Distributions (RMDs) From Multiple Accounts

If you have multiple IRAS, you can aggregate the RMDs for your accounts and then take that amount out of one or any combination of your IRAs. Doing this with your 401(k)s results in steep penalties.

No Withholding

You can opt-out of tax withholding from an IRA distribution but not with a 401(k) distribution. This is a great benefit for those who end up with little or no tax liability at the end of the year.

Self Direction

One of the best parts of having an IRA, instead of a 401k, is that you have the most flexibility in how your IRA assets are invested, whereas with a 401k, your investment options are limited to those provided by the 401k Administrator. With an IRA, you can move your entire retirement account into a self-directed IRA account and then invest the money anywhere you want, including in real estate and start-ups. Yes, it’s true! You get to choose. And, we can help you set up a self-directed IRA and invest your retirement account where you want. Deciding whether to maintain your retirement account as an IRA or a 401k is a critical decision, and requires that you understand the benefits and limitations of both. Relying on generalized information found online is not enough to protect your best interests. Guidance from a Personal Family Lawyer® provides personalized, legal assistance when planning for the care of your retirement portfolio. If you are serious about ensuring you make the best legal and financial decisions throughout your lifetime, meet with us as your Personal Family Lawyer®. We offer Family Wealth Planning Sessions that help you protect and preserve your wealth for future generations. Before the session, we’ll send you a Family Wealth Inventory and Assessment™ to complete that will get you thinking about your retirement goals, and we can help you achieve them. This article is a service of [nap_names id="FIRM-NAME-1"], Personal Family Lawyer®. We don’t just draft documents, we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. Begin by calling our office today at [nap_phone id="LOCAL-CT-NUMBER-1"] to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge. #Retirement #IRA #401K #EstatePlanning