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Practical Planning To Practical Planning To Protect Yourself and Your Protect Yourself and Your
Loved OnesLoved OnesWith Tips for RV’ersWith Tips for RV’ers
By: Martin M. Shenkman, CPA, MBA, PFS, AEP, JD
CaveatsCaveatsCaveatsCaveats
Nothing in these slides or any accompanying presentation is to be considered tax, legal, investment or other professional advice. The information is merely provided for educational purposes and no action should be taken without the individual consulting his or her own tax, estate, legal, financial, investment, insurance and other advisers.
The hosts and sponsors of this program are NOT responsible for its content or accuracy
What is estate What is estate planning?planning? Providing peace of mind for you and your Providing peace of mind for you and your
loved ones on a broad range of planning loved ones on a broad range of planning issuesissues
An integrated plan that coordinates your An integrated plan that coordinates your investments, insurance, emergency and investments, insurance, emergency and disability planning, and more while you disability planning, and more while you are alive, disabled, retired and for your are alive, disabled, retired and for your heirsheirs
You have to define what “estate You have to define what “estate planning” means to youplanning” means to you
Overview of Estate Planning Overview of Estate Planning Documents You Should Documents You Should ConsiderConsider
Overview of Estate Planning Overview of Estate Planning Documents You Should Documents You Should ConsiderConsider
Powers of AttorneyPowers of Attorney• Springing vs. notSpringing vs. not
• General vs. SpecialGeneral vs. Special
• Why standard forms aren’t Why standard forms aren’t sufficesuffice
• Special provisions to includeSpecial provisions to include
Living WillsLiving Wills• What they are and why they are What they are and why they are
importantimportant
• Address specific health issuesAddress specific health issues
• Religious issuesReligious issues
•Health Proxies
•selecting agent
• What powers to include
•Revocable Living Trusts
• Unique importance
• Boilerplate forms rarely address nuances needed
• What can and should you have
Introduction to the 12 Introduction to the 12 StepsSteps Every person is unique – it has to be Every person is unique – it has to be youryour
plan and address plan and address youryour challenges challenges Reflect your personal wishes and Reflect your personal wishes and
circumstancescircumstances Create a strong foundation of documents, Create a strong foundation of documents,
steps and a plan to build uponsteps and a plan to build upon
Action Step: Set Action Step: Set Personal Goals Personal Goals What concerns do you and your loved What concerns do you and your loved
ones have that planning might address?ones have that planning might address? Are you on track with your retirement Are you on track with your retirement
planning? What if you become disabled planning? What if you become disabled or die before retirement?or die before retirement?
Who are you concerned about and who Who are you concerned about and who are you responsible for?are you responsible for?
Are there any special personal, Are there any special personal, religious, financial, health, or other religious, financial, health, or other goals or concerns that might affect your goals or concerns that might affect your planning?planning?
Step 1: Organize Step 1: Organize Emergency, Financial, Emergency, Financial, Information and Advisors Information and Advisors InformationInformation
Contact People Contact People (names, (names, numbers)numbers)
Financial Information Financial Information (account information)(account information)
Passwords and Security Passwords and Security CodesCodes
Documents Documents (Estate planning (Estate planning documents, legal documents, and more)documents, legal documents, and more)
Budget and PlanBudget and Plan
Investment and Financial Investment and Financial Information is Critical to Information is Critical to Organize and CommunicateOrganize and Communicate
Title to AccountsTitle to Accounts• ITF, PODITF, POD• JointJoint• OtherOther
Beneficiary designations Beneficiary designations • For insurance, retirement For insurance, retirement
and other assetsand other assets• Watch brokerage account Watch brokerage account
beneficiary designationsbeneficiary designations
Account ManagementAccount Management• Consolidation and Consolidation and
simplificationsimplification• Are there excess accounts?Are there excess accounts?• Who is giving you guidance?Who is giving you guidance?
AutomationAutomation• Organizing recordsOrganizing records• On line paymentsOn line payments• Set up on computer to Set up on computer to
facilitate planningfacilitate planning
Action Steps: Emergency Info Action Steps: Emergency Info #1#1
People forget and panic. Don’t put off People forget and panic. Don’t put off creating an emergency listcreating an emergency list
Type up a list on your computer so you Type up a list on your computer so you can update itcan update it
Disseminate the list to key people, ask Disseminate the list to key people, ask for their help and tell them what they for their help and tell them what they might need to do to helpmight need to do to help
Each professional adviser should have Each professional adviser should have the list in their filethe list in their file
Action Steps: Emergency Info Action Steps: Emergency Info #2#2
Organize the list by category Organize the list by category (e.g., (e.g., banking, religious adviser, professional banking, religious adviser, professional advisers, family, neighbors)advisers, family, neighbors)
Give only the key facts someone will Give only the key facts someone will need to act in an emergency need to act in an emergency (person (person name, institution, insurance, office/home name, institution, insurance, office/home and cell number, email, etc.)and cell number, email, etc.)
List info needed for emergency List info needed for emergency action action (e.g., account number, policy (e.g., account number, policy number, etc.)number, etc.)
RV TIP Step 1: Organize RV TIP Step 1: Organize Emergency, Financial, Emergency, Financial, Information and Advisors Information and Advisors InformationInformation
Rv’ers, or anyone who travels extensively, should take Rv’ers, or anyone who travels extensively, should take extra precautions to make sure information is extra precautions to make sure information is available when neededavailable when needed
Consider a web based personal information “locker” Consider a web based personal information “locker” and give a trusted person the infoand give a trusted person the info
Email updated emergency info list to key people Email updated emergency info list to key people whenever there are major changeswhenever there are major changes
When determining where to keep accounts consider When determining where to keep accounts consider tax issues of residency/domiciletax issues of residency/domicile
Step 2: Designate a Person to Step 2: Designate a Person to Handle Financial and Legal Handle Financial and Legal IssuesIssues
AgentAgent (Successors)(Successors)
CompensationCompensation Begin dateBegin date (Trigger)(Trigger)
PowersPowers (Authority)(Authority)
DurabilityDurability (Disability)(Disability)
Action Steps: Power of Action Steps: Power of AttorneyAttorney
Choose a trusted agent and several successorsChoose a trusted agent and several successors Hire a lawyer to draft powers that work for Hire a lawyer to draft powers that work for
your personal and financial situationyour personal and financial situation Discuss modifications to standard forms: Discuss modifications to standard forms:
– Gift powersGift powers– Who can/should be supportedWho can/should be supported
Sign then distribute originals and/or copies, Sign then distribute originals and/or copies, organize finances so your agent can act easily organize finances so your agent can act easily and safelyand safely
Evaluate pros/cons of joint accounts versus Evaluate pros/cons of joint accounts versus powerpower
RV TIP Step 2: Power of RV TIP Step 2: Power of AttorneyAttorney
Rv’ers, or anyone who facing tax uncertainty as to Rv’ers, or anyone who facing tax uncertainty as to which state they reside in (or in which they are which state they reside in (or in which they are domiciled) should consider the residence of the agent domiciled) should consider the residence of the agent they name (and where the assets are the agent will they name (and where the assets are the agent will manage in an emergency) when making a selectionmanage in an emergency) when making a selection
Which state law should apply to your powerWhich state law should apply to your power Where should you sign your powerWhere should you sign your power Can you use a broad power that is more likely to be Can you use a broad power that is more likely to be
accepted in other states (e.g., 2 witnesses and a accepted in other states (e.g., 2 witnesses and a notary)notary)
Step 3: Designate a Person to Step 3: Designate a Person to Make Health Care Decisions Make Health Care Decisions and Access Medical Recordsand Access Medical Records
Agent Agent (successors)(successors)
Powers Powers (religion)(religion)
Signature Signature (State law)(State law)
Move Move (state; facility)(state; facility)
Action Steps: Health Care Action Steps: Health Care ProxyProxy
Choose an agent and several Choose an agent and several successors who understand your successors who understand your wishes – e.g. religious preferenceswishes – e.g. religious preferences
Hire a lawyer to draft a health proxy Hire a lawyer to draft a health proxy that accomplishes your personal goalsthat accomplishes your personal goals
Sign originals, distribute copies (or Sign originals, distribute copies (or originals), be sure one is included in originals), be sure one is included in your medical chartyour medical chart
Discuss your decisions with family, Discuss your decisions with family, friends and agentsfriends and agents
Step 4: Step 4: Communicating Your Communicating Your Health Care WishesHealth Care Wishes
Action Steps: Living WillAction Steps: Living Will
A living will can give the agent under your health A living will can give the agent under your health proxy valuable guidance as to what you want proxy valuable guidance as to what you want donedone
Review and consider personal wishes that should Review and consider personal wishes that should be reflected, e.g. religious observances, care be reflected, e.g. religious observances, care instructionsinstructions
Sign a living will that communicates your Sign a living will that communicates your personal decisionspersonal decisions
Review organ donations, burial and last rights, Review organ donations, burial and last rights, etc.etc.
Sign original, distribute copies (or originals), be Sign original, distribute copies (or originals), be sure to include a copy in your medical chartsure to include a copy in your medical chart
Discuss your decisions with family, friends and Discuss your decisions with family, friends and agentsagents
RV TIP Step 4: Living WillRV TIP Step 4: Living Will
Rv’ers, or anyone who facing tax uncertainty as to which Rv’ers, or anyone who facing tax uncertainty as to which state they reside in (or in which they are domiciled) should state they reside in (or in which they are domiciled) should consider the impact of burial requests on state tax consider the impact of burial requests on state tax consequences – gruesome but trueconsequences – gruesome but true
Which state law may govern your health care decisionsWhich state law may govern your health care decisions Where should you sign your health proxy and living willWhere should you sign your health proxy and living will Can you tailor the document so that it is more likely to be Can you tailor the document so that it is more likely to be
accepted in other states (e.g., 2 witnesses and a notary)accepted in other states (e.g., 2 witnesses and a notary)
Step 5: Protect Your Minor Step 5: Protect Your Minor Child With an Emergency Child With an Emergency Child Medical FormChild Medical Form Disclose child’s care/emergency Disclose child’s care/emergency
informationinformation
Action Steps: Protecting Action Steps: Protecting ChildrenChildren
Review all aspects of protecting your Review all aspects of protecting your children with your adviserschildren with your advisers
Guardian and trusts under your willGuardian and trusts under your will Financial planning – 529 plans and Financial planning – 529 plans and
other savings other savings Personal letter of instructionPersonal letter of instruction Directions in your power of attorneyDirections in your power of attorney
Step 6: Sign a WillStep 6: Sign a Will
Action Steps: Sign a WillAction Steps: Sign a Will
Wills are important: trusts to protect Wills are important: trusts to protect heirs and save tax; name executor and heirs and save tax; name executor and guardian; and more guardian; and more
Write a separate personal letter of Write a separate personal letter of instructioninstruction
Consider trusts for minor childrenConsider trusts for minor children Include a donation to charities – send a Include a donation to charities – send a
message to your heirs that giving back message to your heirs that giving back is importantis important
RV TIP Step 6: WillRV TIP Step 6: Will
Hire a lawyer in the state you claim is your domicile – Hire a lawyer in the state you claim is your domicile – this will support your position and get you better this will support your position and get you better advice than trying to rely on an “internet” will advice than trying to rely on an “internet” will
Which state law should apply to your willWhich state law should apply to your will Where should you sign your willWhere should you sign your will If you have real estate or tangible property in a state If you have real estate or tangible property in a state
other than where you maintain you are domiciled, that other than where you maintain you are domiciled, that other state’s laws (and tax system) will applyother state’s laws (and tax system) will apply
Step 7: Consider Step 7: Consider Creating a Revocable Creating a Revocable Living TrustLiving Trust Determine if you and your loved ones will benefitDetermine if you and your loved ones will benefit Establish a personalized (not boilerplate) living trustEstablish a personalized (not boilerplate) living trust Transfer assets to a trust during your lifetimeTransfer assets to a trust during your lifetime Probate and intestacyProbate and intestacy Manage assets during disability or illnessManage assets during disability or illness
Action Steps: Revocable Living Action Steps: Revocable Living TrustTrust
See comments for “Wills” above and See comments for “Wills” above and coordinatecoordinate
Boilerplate Trusts designed to avoid Boilerplate Trusts designed to avoid probate won’t accomplish other probate won’t accomplish other important goalsimportant goals
Focus of document should be Focus of document should be protecting you and your loved ones, protecting you and your loved ones, and communicating your wishesand communicating your wishes
Tailor trustee, business operation, and Tailor trustee, business operation, and other personal provisions to meet your other personal provisions to meet your specific goalsspecific goals
RV TIP Step 7: Living TrustRV TIP Step 7: Living Trust
Using a living trust can consolidate assets, minimize Using a living trust can consolidate assets, minimize the likelihood of other states claiming that their law the likelihood of other states claiming that their law applies, and make management of your assets easier applies, and make management of your assets easier by a family member or friend who lives at a distance by a family member or friend who lives at a distance from where you arefrom where you are
Living trust alone may not suffice, you might need a Living trust alone may not suffice, you might need a limited liability company to own real estate or limited liability company to own real estate or tangibles – consult a lawyer in the state where the tangibles – consult a lawyer in the state where the assets are located in addition to the lawyer you hire in assets are located in addition to the lawyer you hire in the state you claim is your domicilethe state you claim is your domicile
Step 8: Be Sure Your Step 8: Be Sure Your Insurance Coverage is in Insurance Coverage is in OrderOrder Property and casualty insuranceProperty and casualty insurance Long term coverageLong term coverage Disability income replacementDisability income replacement Life insuranceLife insurance Liability Liability
Action Steps: Life InsuranceAction Steps: Life Insurance
Don’t make assumptions – get life Don’t make assumptions – get life insurance coverage reviewed at least insurance coverage reviewed at least every 2-3 yearsevery 2-3 years
Evaluate options – is your life Evaluate options – is your life insurance adequate? What goals do insurance adequate? What goals do you have for life insurance? you have for life insurance?
Standard may not work – what Standard may not work – what objectives do you have for your objectives do you have for your insurance?insurance?
Action Steps: Other InsuranceAction Steps: Other Insurance
Do you have disability insurance (should Do you have disability insurance (should you?) to replace income if you cannot work?you?) to replace income if you cannot work?
Long term care coverage, if obtainable and Long term care coverage, if obtainable and affordable, should be evaluatedaffordable, should be evaluated
Property, casualty and liability coverage is Property, casualty and liability coverage is often the planning step-child – make it a often the planning step-child – make it a prioritypriority
Be sure everyone that should be listed as Be sure everyone that should be listed as insured is; be sure all info given to the insured is; be sure all info given to the insurance company is accurate (e.g., don’t insurance company is accurate (e.g., don’t insure a rental property as if it were a insure a rental property as if it were a residence since its cheaper)residence since its cheaper)
Action Steps: Insurance Action Steps: Insurance ReviewReview
Insurance decisions are not a one-shot Insurance decisions are not a one-shot deal – review all coverage that you deal – review all coverage that you have, and coverage you don’t have but have, and coverage you don’t have but might need, at least every 2-3 yearsmight need, at least every 2-3 years
Have your insurance agent prepare a Have your insurance agent prepare a chart of all coverage – eliminate chart of all coverage – eliminate duplication, evaluate deductibles and duplication, evaluate deductibles and special coverage – often you can special coverage – often you can improve your protection and no or even improve your protection and no or even lower costlower cost
RV TIP Step 8: InsuranceRV TIP Step 8: Insurance
Not every insurance agent or company Not every insurance agent or company understands the nuances of how RV’ing may understands the nuances of how RV’ing may affect your coverage, be sure to explain the affect your coverage, be sure to explain the detailsdetails
Be certain coverage keeps up with lifestyle Be certain coverage keeps up with lifestyle changes – if you rent your home and fulltime RV, changes – if you rent your home and fulltime RV, you need landlord’s insurance not homeowners you need landlord’s insurance not homeowners coverage – the wrong coverage could prevent coverage – the wrong coverage could prevent recovery and torpedo you tax planningrecovery and torpedo you tax planning
Step 9: File Beneficiary Step 9: File Beneficiary Designations and Designations and Confirm Title to AccountsConfirm Title to Accounts
Standard provisions are not always Standard provisions are not always adequateadequate
Coordinate with Revocable TrustCoordinate with Revocable Trust What powers should agent haveWhat powers should agent have Give copies to your advisersGive copies to your advisers Update when banks mergeUpdate when banks merge Revise when tax laws changeRevise when tax laws change
Action Steps: Beneficiary Action Steps: Beneficiary DesignationsDesignations
Consider all beneficiary designations: Consider all beneficiary designations: life insurance, pensions, IRAs, life insurance, pensions, IRAs, brokerage accounts and morebrokerage accounts and more
Obtain copies of the forms you filed Obtain copies of the forms you filed and blank forms to facilitate revisionand blank forms to facilitate revision
Be sure your advisers (CPA, lawyer, Be sure your advisers (CPA, lawyer, financial planner) all have copies of financial planner) all have copies of current beneficiary designationscurrent beneficiary designations
Have family members who name you Have family members who name you as beneficiary consider a trust for youas beneficiary consider a trust for you
Step 10: Give BackStep 10: Give Back Demonstrate important values to heirsDemonstrate important values to heirs Inspire others to give and do goodInspire others to give and do good Estate planning is not only about the Estate planning is not only about the
transmission of money, but about the transmission of money, but about the transmission of valuestransmission of values
Action Steps: To Give BackAction Steps: To Give Back
Make a donation (cash, stuff, Make a donation (cash, stuff, insurance)insurance)
Include a bequest in your will – Include a bequest in your will – even small bequests can make a even small bequests can make a big statementbig statement
Write a heartfelt letter of Write a heartfelt letter of instruction to heirs -- Inspire instruction to heirs -- Inspire othersothers
Step 11: Step 11: CommunicateCommunicate Educate and inform your fiduciariesEducate and inform your fiduciaries Express your wishes to your loved onesExpress your wishes to your loved ones Preparation of beneficiariesPreparation of beneficiaries
Action Steps: CommunicateAction Steps: Communicate
Explain your finances, family issues, Explain your finances, family issues, personal goals, and so forth to your personal goals, and so forth to your advisers – tell all so they can help advisers – tell all so they can help properlyproperly
Discuss with family, friends or others Discuss with family, friends or others involved in your life what your wishes involved in your life what your wishes areare
Can those you expect to rely on really Can those you expect to rely on really help? Have alternativeshelp? Have alternatives
Express your wishes in face to face Express your wishes in face to face meetings and then confirm key points in meetings and then confirm key points in writingwriting
Step 12: Review, Step 12: Review, Revisit, ReviseRevisit, Revise
Nothing remains staticNothing remains static– Tax and property lawsTax and property laws– Family situationsFamily situations– Assets and net worthAssets and net worth– Health Health
Action Steps: Your Action Steps: Your Action PlanAction Plan √ √ Write it down or it won’t happenWrite it down or it won’t happen √ √ Set small goals – an hour a week to Set small goals – an hour a week to
clean up all your financial, tax, estate clean up all your financial, tax, estate and other matters – burdensome goals and other matters – burdensome goals will never be keptwill never be kept
√ √ Tell others – including advisersTell others – including advisers √ √ Get help and guidance to get started Get help and guidance to get started
– an initial consultation with a CPA or – an initial consultation with a CPA or other adviser can jump start the entire other adviser can jump start the entire processprocess