Monday, March 30, 2009

You'll want to read this before you die

By Kimberly Matas
Posted By: Liwin Troy Lee

Businesswoman Belinda Mossor was reeling from the unexpected death of her father, Harry, in 1998.

"It was total chaos," Belinda Mossor said. "My father was ex-military and ex-civil service, and he retired with 32 years in the military and 20-some in civil service. When he died, he had absolutely nothing in place. There was no will, there were no directives and it was extremely hard.

"He had not stipulated whether there was a life- insurance policy to help with the financial burdens," Mossor said. "He did not have anything in place for what he would want for burial or cremation. He just felt that Social Security or Medicare and the value of the house that they lived in would take care of her (Marjorie Mossor) and take care of everything."

It took three years for Mossor and her mother to sort out Harry Mossor's finances, insurance and other assets. Eleven years later, Marjorie Mossor is still learning new things about her late husband's finances. Recently, she received a letter from an insurance company informing her of dividends from a policy that belonged to him.

Click here to read more

Wednesday, March 25, 2009

The Smartest Investment During a Recession

By Ryan Dennin

In desperate times like these everyone is focused on where they can squeeze and extra penny or two. While it may be wise to cut down on trips that take up a lot of gas, or that extra trip to star bucks, it is important to not lose focus on the one thing that is guaranteed to happen. It may sound harsh but everyone will die someday and it is important that an estate plan be completed to ensure the people most important to you are taken care of. The recession may be the ultimate time to take care of the Estate Planning process that so many people have put off for all those years. While writing a sound estate plan may be an added expense it is not something that you don’t want to have in place. The government has a plan for you if you die “inestate” (without a will or trust) and having a plan ensures that YOU make the decisions to what happens to your assets not them. Another important point is putting a plan together for what happens to your assets isn’t an investment that will lose money during this time. It will ensure those items you own are there for the ones you love the most when you pass away. While many people may ignore investing and saving during a recession, an estate plan is not something I recommend passing on during these tough economic times.


Choosing an Executor

Posted by: Ryan Dennin

For the most part, you're free to choose virtually anyone that you want to act as executor of your estate – within certain limits, of course. As long as your choice resides within these limits, the court is obliged to follow your preference in most cases. Generally speaking, the limits are these: you may not appoint a minor, an incompetent person or, in many states, a convicted criminal. Click here to read more

An Outdated Estate Plan is a Worthless One

by Greg Lipinski

There are a number of things that can occur in a person’s life that effect your estate planning. Obviously, death is one of them; hence the purpose of this blog. In that situation, the most notable effect is the need to implement your plan. However, people might have the misconception that because they have thoroughly completely their estate planning, that everything is safe. The only thing left is to kick the bucket and have it go into effect. That couldn’t be further from the truth.

It is extremely important to update your estate planning with any major happenings in your lifetime. If you don’t, there could be a number of problems that are run into when it comes time to allocating your assets to the necessary parties. Some events might include:

• Getting married, divorced, remarried, or any other legally recognized change in relationships
• The purchase of new major assets. These might include new cars or property.
• The birth of (or discovery of) children
• Changes in laws and regulations

Essentially, any major even that occurs can have an effect. With the ones above, you are simply solidifying the fact that your new wife becomes your heir, or that your ex-wife no longer inherits. Any change in your legal status or purchase of major assets need to be allocated. It won’t be assumed that because one of your cars is going to your wife that the new car purchased a few months before your death immediately goes to her.

As for laws and regulations, changes in the economic environment might cause you to either protect or take advantage of new tax rates, rules, etc. The idea isn’t only to leave your heirs with your assets, it is to leave them with as much of the assets as Uncle Sam will allow.

Above are just a few examples of why you should constantly stay updated on your estate planning. If you’re not sure if an event in your life is worth changing your estate plan over, err on the side of caution and review it. Take a look at it and ask yourself if it has even a miniscule effect on it. If it doesn’t, then you’re in the clear. If it does, augment it as soon as possible. You never know when the worst could happen.


Bad economy boon for tax lawyers

Copied and Pasted by Rie Umano

The poor economy has many lawyers twiddling their thumbs - or getting pink slips - as legal work dries up. But the economic crisis has created a business boom for one subset of the legal industry: small to midsized tax practices.

"I am not suffering," said Charles Rubin, a tax attorney with Gutter Chaves Josepher Rubin Forman Fleisher in Boca Raton, Fla., and author of the blog Rubin on Tax. "I'm as busy as I've ever been."

Events over the past year have created a perfect storm of sorts, forcing small to midsized businesses and the people who run them to seek legal advice on a host of tax and estate planning issues.

Click here to read more

Estate planning mistakes

Posted by Rie Umano

It is not always fun task, but estate planning is necessary to transfer your assets to your heirs effectively. You might be able to avoid high federal taxes and estate taxes if you plan properly. It is always better to plan earlier and constantly check your estate planning as things change. However, even if you planned already, there are some mistakes you might make possibly. Here are some examples.
1. Failing to make an estate plan – when it comes to basis estate planning, it seems like most people simply avoid doing it. They just do not want to deal with death, complicated family situation, misperceived expensive costs and many other reasons. However, no matter what your situations are, you should start creating your estate plan. Otherwise, you will end up paying more money and hurting your family after you die. Make sure you keep updating your estate plan, so that it will work that way you intended.
2. Forgetting about little things – many people tend to forget their personal effects to the plan. Your jewelry, art work and collectibles can affect your estate planning as well.
3. Choosing wrong fiduciaries – many people tend to chose wrong people or institution to serve as their Personal Representatives or Attorneys. Choosing the right fiduciaries is pretty significant when you create your estate planning. Your plan would not work well if your fiduciaries cannot work efficiently.


Before Your Parents Say 'I Do' Again

Posted by Brian Redhead

It's rare that an inheritance passes from one generation to the next without leaving some scars. But smooth transitions are becoming even rarer thanks to the growing influence of a new player: the second spouse. As Americans live longer, they're more likely to move into second marriages, and legal experts and financial planners say the resulting friction with the kids is steadily mounting. In more cases grown children are going to court against their parents even while they're still alive, only to run up against a legal framework that leaves them with surprisingly few rights compared with their parents' new spouses. The once-sleepy field of trust and estates law is now brimming with hardened litigators. In Texas, personal-injury lawyers in search of big paydays have begun taking on will contests. And just as court squabbles are on the rise, so are prenups and sophisticated trusts that are designed to forestall them.

Naturally, there are more than bruised feelings at stake. The generation that’s growing old now is arguably the wealthiest in history, and many of their baby boomer kids are counting on inheriting some of their dough. But that legacy is under threat. The stock market’s nosedive and the housing slump have combined to wipe out $15.5 trillion in net worth in the last two years, according to the Federal Reserve. Along with this financial tumble, a growing number of would-be heirs face the biggest threat of all: a new stepmom or stepdad. According to a 2007 study by two Wharton professors, people over 65 are now more likely to be married than ever before, in large part because of a spike in late-in-life marriages. Even as the inheritance pie is shrinking, more family members are fighting for a piece of it.

Click here to read more.

Estate Planning for Your Pet

Post By: Dana Sunderlin

When dealing with estate planning, many people focus on the people and physical assets that they will be leaving behind when they die, but many of them do not take their pets into consideration. It has been found that a pet can suffer from sever anxiety when their owner dies. It is important that there will be someone around that knows your pet’s diet and medications, and that can keep them in their usual daily routines. In addition to having high anxiety, many pets wind up in shelters or on the streets after their owners pass away. To keep this from happening to your pet, make sure you include your beloved animal in your estate plan!

The simplest way to ensure the safety of your pet after your death is to find a friend or family member who is willing to take care of them, and to have an attorney draft a will leaving them to that person. You could also give the right to the executor of your will to choose amongst a number of people when the time comes. Another important thing to remember is that it will greatly help the person who is willing to take care of your pets if you leave them a certain sum of money to help with the cost of doing so. Creating a trust for your pet is also an option. Many states now have “pet trust statutes,” which allows you to set up a trust along with name a trustee and caretaker for your pet (s). Although there are two different types of pet trusts, many pet owners choose to use a traditional trust, which gives you more power and control over the terms of the trust.


Living Trusts vs Wills

By Steven Muller

A living trust is a legal entity that can own property and direct distribution of that property after a person's death. One of the benefits of a living trust is that it isn't subject to probate, or its associated costs and delays.

If you establish a trust, you appoint yourself as the initial trustee and primary beneficiary of the trust. You retain full and complete control over the property during your lifetime. In the living trust document, you appoint the individual or charities that will take on the role as successor trustee when you can no longer act as the initial trustee. After death all your assets are given to your beneficiaries without the hassle of probate. Probate is the process of properly transferring the estate to the rightful beneficiaries. This process is also used to collect any taxes due on the transfer of the property.

The property from the estate can be also transferred to the intended beneficiaries via a will. A living trust is sometimes referred to as a "will substitute." Although, in some respects, it does take the place of a will, a will is still usually necessary to distribute assets outside the trust, and to nominate guardians for minor children. The major difference between a will and a living trust is a will does not avoid probate and does not protect the management of your assets in the event of you should become debilitated during your lifetime.


In Rough Economic Times Don't Panic

By:  Jeremy Radnor

In life, it is only natural to react to the environment around you.  In todays financial environment, people are reacting negatively.  The news torments viewers daily with poor economic performance, dipping stocks, and major financial institutions falling apart and behaving poorly.  In the past year, the net worth of American households have dropped by the most ever in over half a century.  The FED reported a 9% drop in American net worth in the third quarter.  America's net worth as of April-June 2007 was valued at over $64 trillion.  Today, that value is down to just over $51 trillion.

Despite things being so bad, it is important that investors not over-react. Financial professionals have identified 5 investing mistakes not to make during this rough patch in the economy:
1. Dont wait it out - This doesnt mean dump your portfolio but it may be a good time to reallocate your current funds.  Also, make sure to diversify your current position.
2. Dont dump your 401(k) - Dont pay too much attention to its current situtation but dont forget about it either.  Dont pass up the chance for free money with employee matching plans.  Consider just putting in up to the matching point.
3. Dont hide behind CDs - Although they are relatively safe, they yeild very low returns and should be considered short term.
4.Dont think outside the box - Get back to basics.  Now is not the time to get creative and maybe refer back to investments that do well when stocks are performing poorly (such as gold).
5.Dont favor yor mortgage over your emergency fund - In case you lose your job, investors need to make sure that emergency stash is still there and available for at least 6 months.

Finally, it is always tempting to focus on the now.  However, it is more important, especially financially speaking, to plan for the long term and the future.  Keep track of your investments.  Based on your current financial position, try to predict where you will be by retirement and if you will have enough to live the way you want to when that day comes.


Tuesday, March 24, 2009

Estate Planning in a Down Market

by Amy Feldman
Posted by Greg Lipinski

When times are tough, people tend to hold on to what they have that much more tightly. But for those who can get beyond that psychological response, there's a silver lining in today's combination of depressed asset values and low interest rates: Transferring assets to the next generation has rarely been less costly.

That's because depressed valuations allow you to get those assets out of your estate and over to your kids with less gift tax, while low interest rates create additional advantages for those who use certain wealth-transfer vehicles or intra-family loans. In fact, with the Federal Reserve cutting interest rates, the rates set by the Internal Revenue Service for use in one of the most popular wealth-transfer vehicles, known as a grantor retained annuity trust, or GRAT, is now at an historic low of 2.4%, down from 3.4% in December. The rates for intra-family loans are at similar historic lows, now just 0.81% for a short-term loan.

"If the markets are going to recover, then let that recovery be on your kids' balance sheet rather than yours," says Don Weigandt, a wealth adviser at J.P. Morgan Private Bank in Los Angeles. "The major issue is psychological. It's the brain battling the heart."

To read on, click here.

Monday, March 23, 2009

No More Too Big to Fail

Posted by Brian Redhead

The Obama administration is on the verge of rolling out a series of new regulations to prevent a repeat of the still rampaging financial crisis. But it’s not enough for policy makers to simply propose expanding the Federal Reserve’s enforcement power, or putting forth new rules for regulating derivatives, exotic securities and hedge funds.

What’s needed now more than anything, is a plan to ensure that no financial institution is ever again “too big to fail.’’ The seemingly endless bailouts of American International Group(AIG), Citigroup(C)and Bank of America (BAC)are all premised on the fear that if any one of these financial services giants were to fail, the global economic fallout would be catastrophic. And as distasteful as it may be, regulators and policy makers are correct that there’s no other choice than to save these firms.

But once these financial behemoths no longer pose a systemic threat, they need to be dismantled and dramatically shrunken. And the same must go for banks that aren’t on the critical list. So far, JPMorgan Chase & Co. (JPM)has managed to avoid becoming a financial basket case like Citi or Bank of America. But the world economy cannot risk a situation where some future crisis puts JPMorgan on the edge of disaster. If that means forcing relatively healthy banks to get smaller—either through voluntary divestures or old-fashioned trust busting—so be it.

Click here to read more.

Bolting the Stable Door

Pasted by Brian Redhead

“THE TEMPEST”, or “A Midsummer Night’s Dream”? Scenes from both plays looked down on Lord Turner in the Drapers’ Hall as he explained on March 18th how the Financial Services Authority (FSA), the financial watchdog he chairs, will change and get much tougher. He chose to speak in the heart of the once-glorious City rather than in the casino-country of Canary Wharf, London’s wholesale financial district. There, the FSA has made itself perhaps too much at home.

His review anticipates a meeting of G20 leaders in London on April 2nd, which has financial regulation high on its agenda. European, indeed global, co-ordination is an important component of any effective new approach. But no matter what anyone else does, the FSA, whose reputation has been battered by the collapse of various banks under its supposedly watchful eye, must clean up its act at home, as it freely admits. This is a start.

Click here to read more.

U.S. Rounding Up Investors to Buy Bad Assets

Copied and Pasted by Rie Umano

WASHINGTON — Obama administration officials worked Sunday to persuade reluctant private investors to buy as much as $1 trillion in troubled mortgages and related assets from banks, with government help.

The talks came a day before the Treasury secretary, Timothy F. Geithner, planned to unveil the details of the administration’s long-awaited plan to purchase troubled assets, meant to remove them from the balance sheets of banks and, in turn, spur banks to lend more money to consumers and companies.

The plan relies on private investors to team up with the government to relieve banks of assets tied to loans and mortgage-linked securities of unknown value. There have been virtually no buyers of these assets because of their uncertain risk.

As part of the program, the government plans to offer subsidies, in the form of low-interest loans, to coax private funds to form partnerships with the government to buy troubled assets from banks.

Click here to read more

A.I.G. The Brand is Tarnished

Copied and Pasted by Rie Umano

The government’s fourth round of assistance to the American International Group this month was a play for time — for languishing markets to rebound, for pockets to fill up again and for buyers to emerge for the sturdy insurance companies under A.I.G.’s tattered corporate umbrella. Only when those insurance companies are sold will there be money to repay American taxpayers.

But after the latest uproar, time does not look like A.I.G.’s friend. The problem now is not a toxic spiral of derivatives like the one that crippled the company last fall, but the damage done to A.I.G.’s brand, first by the financial troubles and then by the recent wave of hearings, subpoenas, late-night television jokes and even a bus tour past executives’ homes.

A strong brand is something no insurer can afford to put at risk. Insurance companies trade, more than anything else, on their image of strength and stability.

Click here to read more

Toxic asset plan nears completion

By: Jeremy Radnor

WASHINGTON - Treasury Secretary Timothy Geithner could announce as soon as Monday his much-anticipated plan to get toxic assets off the books of the country's struggling banks, administration and industry officials said.

The plan will use the Federal Reserve and the Federal Deposit Insurance Corp. to make the resources of the government's $700 billion financial rescue fund go further, the officials said Friday.

Geithner is being forced to tap the Fed and the FDIC for support because the prospects for getting additional money from Congress for the bailout effort have dimmed significantly given the recent uproar over millions of dollars in bonuses provided to troubled insurance giant American International Group Inc., the largest recipient of government support.

To read more click here.


Re-evaluate your estate plan

By Jennifer Ng

Reevaluating your estate plan is crucial and necessary in order to not have your property and money ending up in the wrong hands in the future. It is said that you should update your estate plan when major changes happen in your life, such as financial changes, additional children, marriage/remarriage, and moving. Throughout everyone’s lives there will be changes that can significantly affect their estate plan; so it is important one revise their estate plan to make sure their wealth be distributed to the people they want. The estate tax is going to stay and cannot be taken away. Of course this is no big issue for those who have less than $3.5 million for that is the minimum a person can die owning before they are subject to the tax. But those who are/were to pay the estate tax lost a good amount of their wealth. This also meant their inheritors lost a good amount of wealth due to the estate tax. These factors cause problems in today’s estate plans that may not have been problems when first drafted. What caused these problems was that whoever drew up the estate tax did not prepare for the changes in economy.


Today's Job Market and Your Work-Life Balance

By: Jeremy Radnor

Everywhere you look today, it seems there is more evidence of the poor job market and weak economy.  The media would lead you to believe that things cannot get any worse and we are facing the end of the world.  This is obviously an exageration but the current situation should not be taken lightly.  It is time to take a closer look at the job market and how people are coping and behaving.  

To begin with, recently the unemployement rate has reached a 17 year high.  As terrible as this is, people are quick to forget that still over 90% of the US is employed.  This means that more than 9/10 people have a job.  None-the-less, as things seem to turn increasingly worse, the work-life balance that has been stressed in the past is quickly being forgotten.  Employers and employees used to promote a balanced approach to work and life.  This has benefits for both the employee and employer.  Employees have more free time and feel better.  This leads to better work in the work place.  Today, there is no balance.  It would appear the work force has been divided into two segments, work and life.

The work group can be divided into two additional segments.  The first group being those who work to ensure they are employed.  This group consists of employees who work ridculous hours in a day just to ensure they arent fired.  The second group are those who work out of love.  With the job market as it is, many people have been forced to try new and different careers (careers of passion).  Employees are finding themselves feeling happier and more fulfilled.

As for the life group, these people have decided to simply ignore the current situation.  This is extremely evident within generation-Yers.  Many generation-Yers are taking the current situation as an opportunity.  Yers have been using their severance pay or unemplyoyment aid to simply live it up.  Yers have been quoted saying they are gonna take their severance and backpack through India or they use it to go out and party.  Although these may not be good fiscal decisions, they are definitley enjoying life.

This leads me to the point of this article.  Just because things are a little worse than usual, it doesnt mean everything changes.  Work-life balance is still a vital aspect of a successful life (professionally and personally).


Estate Planning Without Anxiety

Copied and Pasted by Jennifer Ng

With the markets in constant turmoil, planning for the here and now seems daunting enough; planning for the after-I-die is even less appealing. Nobody likes talking about death, telling relatives what they’re going to inherit or wading into jargon like terminable interest property. But if you haven’t figured out where you ultimately want your investments and property to go, you won’t control what happens to your savings when you die—and your family will be forced to make hard decisions without your guidance. The stretch between Thanksgiving and New Year’s is a great time for reflection and resolution. Here’s how to get on the ball.

First, take stock of everything you own: Your estate includes not just your personal belongings and investments but also your home, life insurance and retirement savings plan assets, as well as your share of any jointly owned property. You must not only decide where you want each piece to go after you die but also inform your loved ones. If this sounds difficult, start by literally cataloging how you have piled up your most important possessions; connect the work you’ve done with the things in your life that hold the most meaning. Using your life story as a narrative, write down what you’ve accumulated and develop a list of your most significant purchases and investments. Then when you divide up your estate, you will be working from a sense of pride in your accomplishments, not anxiety about death—and your heirs may be fascinated by the details that emerge.

Click here to read more.

Toxic Asset Plan

Post By: Dana Sunderlin

President Obama’s administration recently drew up a plan to use capital injections as an incentive, in order to get private investors to buy up a trillion dollars worth of bad assets from those banks who are currently reluctant to give out loans to different consumers and companies. Along with these incentives, private investors would receive federal loans to buy the assets. Treasury Secretary Timothy Geithner feels that it would be “cheaper to provide taxpayer financing than have the government buy the assets outright.”

Many people feel that the toxic asset plan is not the answer for a revival of credit markets. It has been found that this new prospect that taxpayers may need to pay for underperforming assets is making banks reluctant to sell these bad assets off to lower bidders. The plan has made banks afraid to buy and to sell, since the government’s plan for these toxic assets has created additional value for them; “As long as there’s the prospect the federal government will overpay for the toxic assets…these banks would be insane to sell in the private market.” As a result, the plan is not resolving anything.

However, President Obama’s take on the plan is that it is a critical element in the revival of our economy and he is confident that it will work. Treasury officials reportedly have no solid forecast on when these asset purchases will actually begin, although many believe that it will be within a few weeks.


Home Sales are up Across the Nation

By Daniel Powell

In an economy when many are being tighter with their money, home sales have surprisingly gone up throughout many parts of the nation. Home sales in California are up 42.5% in February compared to last years numbers. A report shows that 29,225 new and resale houses and condiminiums were sold in California last month. The average price paid was consistent with that of January at $373,000. Due to all the foreclosures and the lowering prices of homes, bargain hunters have been out in force and buying up everything they can while they are cheap.

Across the nation, existing home sales have posted a 5.1% gain which comes as a surprise to many. As stated earlier, people not only in California but across the nation are taking advantage of the deep discounts on mainly foreclosures and other distressed properties. While many are being, prices are stille xpected to fall well into the year. This is due to the fact that many homes are still tied up in the foreclosure process and aren't for sale yet. We also must remain that people are still losing jobs due to the current recession. Nicolas Retsinas of Harvard University said the key word to the housing market is jobs. If you are likely to have a continious job you may be buying but for those who are worried about having a job tomorrow are sitting on the sidelines.

It is important to remember that the main reason that sales are going up is due to the break in prices. The median price for an existing home fell by a whopping 15.5% last month to $165,400. As a basic economic rule, when supply is high and there is not a lot of demand, the prices are going to follow a downward trend. It is also a good time to buy for those with the proper credit and income because Freddie Mac shows the average 30-year mortgage rate at 5.13% in February, up slightly from 5.05% in January. However, even though rates are low, many people cannot take advantage of these rates because since December 2007, the economy has shed 4.4 million jobs, including a huge 651,000 last month.

View the orginal articles in the entirety here:

Top lenders pull plug on small biz loans

Copied and Pasted by Daniel Powell

NEW YORK ( -- At a time when small business owners desperately need loans and credit lines to help them weather the recession, some of the industry's most active lenders have bolted shut the doors to their vaults.

Temecula Valley Bancorp (TMCV) and Capital One Bank (COF, Fortune 500) have stopped taking applications for new loans through the Small Business Administration's flagship 7(a) loan program, and Bank of America (BAC, Fortune 500) has slowed its lending volume to a trickle. Small Business Loan Source, a non-bank SBA lender that specialized in commercial real estate financing, is closed to new applications and leaving all new SBA lending activity to its parent company, First Bank in Clayton, Mo.

These four institutions were among the 30 largest SBA lenders in the 2008 fiscal year, accounting for 4% of the program's loan volume, or $524 million of the $12.8 billion that waslent to nearly 70,000 businesses, according to data compiled by Coleman Publishing, which monitors small business lending trends.

The article talks about how banks are slowing and some are altogether stopping to loan to small businesses at a time where they may need it most.

View the original article HERE

Probate: Avoiding it with a P.O.D.

By Steven Muller
People that have worked their entire lives earning a living and creating an estate don't want to see their life's work go to the government in the form of taxes. Probate is is the legal process of administering the estate of a deceased person by resolving all claims and distributing the deceased person's property under the valid will. This involves going to court and can be a lengthy process. If your family is in the need for immediate funds to survive after your death, then this is a very important issue to resolve and avoid. There are some ways to accomplish this and one being payable-on-death bank accounts.

Payable-on-death bank accounts offer one of the easiest ways to keep money out of probate. All you need to do is fill out a simple form, provided by the bank, naming the person you want to inherit the money in the account at your death. As long as you are alive, the person you named to inherit the money in a payable-on-death (P.O.D.) account has no rights to it. If you need the money you can spend the money, name a different beneficiary, or close the account. At your death, the beneficiary just goes to the bank, shows proof of the death and of his or her identity, and collects whatever funds are in the account. The probate court is never involved. Setting up an account like this one is a very easy way to avoid the time and hassle of probate courts.


Changes in Estate and Gift Taxes

By Steven Muller

A number of important changes have been made in the past several years in estate and gift taxation. This memorandum summarizes the pertinent Estate and Gift Tax provisions as they affect estate planning.

1. THE MARITAL DEDUCTION: The Internal Revenue code ("IRC") and North Carolina grant an unlimited gift and estate tax deduction for all transfers to a spouse whether made during life or death. Thus, any one may give or leave his or her entire estate to the surviving spouse without gift or estate taxes. The following qualify for the marital deduction: Outright gifts and bequests, jointly-held property, life insurance, joint and survivor annuities, certain life estates in real estate, and trusts of which the surviving spouse is sole income beneficiary for life.

2. MARITAL DEDUCTION ("Q-TIP") TRUST: The IRC and North Carolina permit a marital deduction in the estate of the first spouse to die, for a trust which provides for all income to the surviving spouse for life. Upon his or her death the balance in the trust will pass to the person or persons named in the trust clause. This kind of trust - called a "Q-TIP" - may be used to prevent a diversion of assets from the decedent's family, such as may occur upon a remarriage of the surviving spouse. It is particularly helpful in second marriage situations with combined families.

Click Here to Continue Reading

How to spend $700 billion in 6 months

Post By: Dana Sunderlin

NEW YORK ( -- Remember that $700 billion financial sector rescue plan from October? It's all but spoken for.

After Treasury Secretary Tim Geithner promised to spend up to $100 billion on a toxic asset purchase plan Monday, only $10.2 billion remain unallocated in the Troubled Asset Relief Program.

After former Treasury Secretary Hank Paulson determined how Treasury would spend up to $460 billion of the funds in his tenure, the new administration has committed another $230 billion in just two months. But with the government's rescue programs still incomplete, Geithner may need to ask for more.

(For a look at how Treasury and other government agencies have used taxpayer dollars to rescue the economy, click here.)

"Secretary Geithner is going to need to go to Congress and ask for more money sooner rather than later," said Anne Vorce, policy director at the New America Foundation, a public policy think tank. "He's done everything possible not to go back to Congress, but now the amount left is a worry."

Estate Planning for Unmarried Couples

by Brian Redhead

In his article entitled “Estate Planning Tips for Unmarried Couples”, author Randy Hecht illustrates the profound challenges faced by unmarried couples in the realm of estate planning. Though he recognizes that the obstacles faced by such couples are comparatively major to those faced by married couples, he asserts that these obstacles are not insurmountable. Through careful strategizing and a thorough awareness of the legalities surrounding state-specific estate planning, unmarried couples can ensure that they have the same rights as their married counterparts.

Indeed, it is beyond unfortunate that, in the eyes of the law, couples that are unmarried, whether they’ve been together for one year or fifty years, are synonymous with strangers. According to the US Census Bureau, the number of unmarried couples is increasing by several million each year (Reeves, “Financial”). Such couples have no legal rights when it comes to property or healthcare, often creating painful circumstances when one partner is in extremely poor health or has passed on unexpectedly. Hecht offers the following suggestions for unmarried couples to effectively plan their estates to protect themselves against such dire circumstances: create a concrete power-of-attorney for each other, prepare a durable health care directive, and maintain updated beneficiary designations on all insurances. Additionally, unmarried couples with children need to often make special accommodations for all family members to ensure no one is slighted in the event of an unexpected death (Reeves, “Living”). While some states are trending toward broadening the rights of domestic partnerships, most states still require that unmarried couples take substantial precautions to ensure their rights are adequately protected.


Hecht, David (2004). “Estate Planning for Unmarried Couples”. Retrieved on March 18th, 2009,

Reeves, Scott (2005). “Financial Tips For Unmarried Young Couples”. Retrieved on March 19,
2009 from

Reeves, Scott (2005). “Living Together Makes More Sense”. Retrieved on March 19, 2009

Top Five Estate Planning Mistakes

Post By: Dana Sunderlin

When it comes to basic estate planning, time and time again I run into these five common mistakes. Learn what they are and how to avoid them when making or updating your estate plan.

1. Mistake #1 - Failing to Make an Estate PlanWhen it comes to basic estate planning, I've found that many people simply avoid it. The typical reasons why range from fear of death, to misperceived expensive costs, to complicated family situations. Suffice it to say that without an estate plan, you'll be leaving your loved ones in the dark, and they'll end up spending thousands of dollars (that you thought you saved by not creating a plan) figuring out what to do for you if you become disabled and what to do for themselves after you die. Avoid this #1 estate planning mistake. Begin your planning early, while you still have your wits about you, and then review and update your estate plan frequently to insure that it will work the way you intended when it's actually needed.

Estate Planning Attorney Talks About Avoiding Probate

By: Jeremy Radnor

Jon Graft, an attorney, discusses how to avoid probate.


Sunday, March 22, 2009

It's Better to Give Than Receive (Really!)

By Steven Muller
One thing you can do to save estate taxes, whether you are married or single, is to start giving away some of your assets now to the people or organizations who will eventually receive them after you die.

This is an excellent way to reduce estate taxes because you are reducing the size of your taxable estate. (Just make sure you don't give away any assets you may need later.) But what may be even more satisfying is that you can see the results of something that may not have happened without your help.

You can currently make annual tax-free gifts of up to $13,000 per recipient. If you are married, you and your spouse together can give $26,000 per recipient per year. (You can either give $13,000 each, or one spouse can make a $26,000 gift with the consent of the other spouse on a timely-filed gift tax return.) You can also give an unlimited amount for tuition and medical expenses if you make the gifts directly to the educational organization or health care provider.
You do not have to give cash. For example, if you want to give some land worth $52,000 to your child, you can give your child a $13,000 "interest" in the property each year for four years.

Wills are a Good Idea for Younger People too!

By Daniel Powell
Even though the thought of passing away and having a plan in place may not cross your mind in your younger years, you are never too young to do some basic estate planning. Putting together a simple plan can be very beneficial to parents, friends, and loved ones and can save them countless hours of time in the case of death. This plan does not take very long to put into action and there are two main areas that should be addressed to do so. A standard will should first be created to give instructions on how your assets are to be handled and distributed after death. Second, a plan should be in place that tells your wishes in the event that you are still alive but unable to make decisions for yourself.

These decisions may seem too soon to start making for those in there late teens and 20’s because they are either planning or just starting to plan their future. However, making a will is not as painful as it may sound and should be kept simple. For those of us who are young, single, and don’t currently have a lot of possessions, there are do it yourself books or software programs that can guide you through writing a simple will. The approximate cost of doing so is under $50. If you were to hire a lawyer, a simple will is going to start around $250 and could go up to $1,000 depending on your situation.

Most people will agree that the average person in their 20’s is not going to need a lawyer to write their will for them. Making a will is going to rarely involve complicated legal issues. Most lawyers will use a standard form that contains the same clauses that are found in most do-it-yourself wills. Many lawyers have their secretary type in all the basic information for the will which is something you have the capability of doing yourself for the cost of your time. However, for a will to stand precedent, you need to sign and acknowledge it in front of two witnesses.
View the original articles in their entirety below:

Overlooked Estate Planning Moves

Copied and Pasted by Daniel Powell

Here are the important issues that frequently are overlooked or dealt with summarily in many estate plans.

Carefully consider all non-probate assets. These assets are excluded from the “probate estate” by state law and avoid the probate process, so their disposition is not covered by the will. (Many of them are included in the gross estate for tax purposes.) Their disposition is covered by law or by contract. These assets include IRAs, employer retirement plans, life insurance, and annuities. Living trusts and all the assets in them also avoid probate.

Most non-probate assets have a beneficiary designation that must be completed. It usually is a section of the account application or contract, or in a separate document. IRAs and 401(k)s are the prime examples. The accounts will be transferred as indicated on the beneficiary designation form. If no one is listed, the account will be transferred to the estate, which for these assets would cause the loss of most tax deferral and would trigger higher income taxes on heirs than necessary.

For each of these non-probate assets, the custodian or account sponsor looks only at the forms in its records. Often, a beneficiary designation form was completed many years ago, perhaps before the owner was married or had children. In the ensuing years, the owner’s marital or family situation could change. Yet, many people forget about their designation forms and do not update them with the estate plan.

The article talks about the topics of estate planning that are often overlooked by people. The entire article can be read HERE

Wednesday, March 18, 2009

You’re Dead? That Won’t Stop the Debt Collector

Copied and Pasted by Jennifer Ng

MINNEAPOLIS — The banks need another bailout and countless homeowners cannot handle their mortgage payments, but one group is paying its bills: the dead.
Dozens of specially trained agents work on the third floor of DCM Services here, calling up the dear departed’s next of kin and kindly asking if they want to settle the balance on a credit card or bank loan, or perhaps make that final utility bill or cellphone payment.
The people on the other end of the line often have no legal obligation to assume the debt of a spouse, sibling or parent. But they take responsibility for it anyway.
"I am out of work now, to be honest with you, and money is very tight for us,” one man declared on a recent phone call after he was apprised of his late mother-in-law’s $280 credit card bill. He promised to pay $15 a month.
Dead people are the newest frontier in debt collecting, and one of the healthiest parts of the industry. Those who dun the living say that people are so scared and so broke it is difficult to get them to cough up even token payments.

Click here to read more.

Estate planning checklist

By Jennifer Ng

Here are 12 steps on preparing your estate plan.
1. Arrange your will.
Without a will, your estate will settled in probate court.
2. Gather all other records for storage.
3. Use estate planning softwares.
Many of these softwares can help you to at least get started on the planning. It helps save time and gives an attorney sufficient information to create legal documents. After, have a lawyer review the documents.
4. Have a witness (not your beneficiaries) for your will.
5. Have an estate lawyer review your plan.
6. Keep your beneficiary designations (assets that do not pass under a will) updated.
7. Assign an executor to distribute the assets.
8. Find a custodian for your children.
9. Sign only one set of documents, witnessed, and notarized. You can make extra copies to keep on file.
10. Update and review your estate plan every few years because laws change and so your planning may be out of date.
11. Don’t keep the insurance policies in a safe- deposit box.
12. Choose the right kind of joint ownership (3 kinds) based on your estate planning needs.


Plan for the Worst, Even if You're Young and Broke

by Greg Lipinski

Most people, including myself, immediately think of an elderly relative that has recently passed when the words “estate planning” come up. I imagine a group of family in a lawyer’s office waiting to see who inherits what assets (or liabilities) acquired by the family member over the years.

The fact is that you can become incapacitated, no matter your age. It is a dismal thought, but it’s a necessary one. Anything from an illness to sudden, accidental death can occur. And although you haven’t had 80 or 90 years to accumulate a cache of assets, you have to be ready to bequeath what little assets you might have to the people you want it to go to.

Ultimately, the thing to know is that the situation is never as simple as it might seem. Don’t take chances. You might become sick and cannot follow through on financial obligations. Who steps in on your behalf? What steps do this person take? These are important questions that should be answered and explicitly stated in a will. Situations could get even more complicated. For instance, there was a case where a father of a young family passed away unexpectedly, and the last will that he had written during a previous marriage. Needless to say, his current family didn’t benefit much at all from this complication.

The game plan from this is to make a simple will. All of your assets need to go somewhere if you are incapacitated or worse, so make it very clear and certain where they go or else state laws will handle that for you (which isn’t always according to your wishes). Sources state that at a young age with a minimal amount of net worth, you could easily get by with using a computer software program that can spell out the very basics. However, once you reach a net worth of $2 million, you should consult a lawyer. Either way, get help where you need it and come up with, at a minimum, a very basic plan for your assets if the worst were to happen.


Basics to Estate Planning

By Steven Muller

Estate planning involves the determination of who will inherit your property upon your death. Estate planning also should include actions intended to minimize taxes and address issues related to the care and custody of children. The only way to be sure that your goals and wishes are followed is to document them in a legally binding manner. This usually means signing a document that states these goals and that has been signed, witnessed, and notarized as required by law. Specific documents are intended to carry out specific goals. These are a will, living will, medical power of attorney, durable power of attorney, and/or a trust.

It is important to remember that planning your estate is a continuing process. Changes in your financial affairs and changes in your family may make it necessary to change and update your estate planning documents. You should review your will and other documents at least once every two or three years to determine if they still accurately reflect your situation and goals. In addition, if you experience a major change in your finances or family you should also review your will and other documents.

In summary, estate planning is your opportunity to make decisions regarding your property and finances. By planning your estate and communicating your decisions with your loved ones, you will be lessening the conflicts and difficulties that they may encounter later.