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Estate Planning

Fully Fund or Even Over Fund a #529 Plan Account?

By Estate Planning, Food for thought, Wills

If you have the means, and want to support your kids’ or grandkids’ educational efforts, I would consider funding or even overfunding 529s for them.

If you use a 529 plan, and you use the Pennsylvania plan, it escapes inheritance taxes and grows tax free if the money is used for education for as long as the money is in the plan. Now that means, you might want to consider funding it more fully than it might have been in the past or fully funding it if you can keep it in the plan for a long time.

It’s tricky with education because you don’t know how much they’re going to need because few pay the sticker price for private schools, and you don’t want to overfund it because it is stuck with education; but if you think about it, if you do have the means, and you have enough for your own retirement and are otherwise secure, if there’s more in the child’s plan then they need and there’s money left over, that money can stay in that plan and then you can change it to another beneficiary, like say their children, and grow tax free and compounding for a generation.

That can really have a nice snowball effect, it might even be able to keep up with the cost of college inflation! Anyway, it’s not something that a lot of people can think about or do, but it’s something that I’ve been thinking a lot about the past couple months and I think for some, it’s something to consider. Think about full funding your 529 fully or even putting in more than you necessarily need. Again, if your retirement is secure and you don’t otherwise need the money. You could get some great tax and investment gains out of that.

You do Estate Planning for Your Loved Ones

By Estate Planning, Food for thought

Recently I was talking to a friend of mine who lost his dad and we talked for a while, as I had known his dad and we shared some stories.

He then started talking about all the stuff he must go through to settle his dad’s estate and finish up his affairs. It really struck me then, more so than any other time, that you do your Estate Planning because it’s something you’re supposed to do sure, but you really do it for your loved ones, your heirs, the people who are going to be left behind putting your affairs in order and transferring them to your beneficiaries.

Keep that in mind when you update your Wills and other documents and when you update everything that you have for them, like the organization of all your stuff.

Make sure your heirs know where they can find your things, make sure they know where to find passwords or they know where everything is.

You don’t necessarily have to tell them everything, although that might be really helpful, but make a nice list and make it easy for them to find and tell them where to find it. It’ll make things much much easier, and they’ll be going through something that is very hard when you pass, and if you can make it a little bit easier and do this, then it’s a great service you can do for them.

Ask an Elder Law Attorney – What can I do if my elderly parent is losing the ability to make decisions and manage his or her affairs?

By Elder Law, Estate Planning

Ask an Elder Law Attorney – What can I do if my elderly parent is losing the ability to make decisions and manage his or her affairs?

By Joellen Meckley, Esq.

Here are three things you should keep in mind:

  1. The best time to plan is now. Oftentimes, mental decline in old age does not happen suddenly, it happens gradually. The signs can begin to show in subtle ways, such a noticing your mother isn’t paying her bills or has bounced a check or noticing that your father’s personal hygiene has begun to decline. Don’t ignore those signs, because the best time to plan is when your parent is still relatively healthy and competent. Planning can always be done, but the longer you wait, options become more limited.

 

  1. These conversations are often difficult. Older adults are no different from the rest of us – some are more resistant to change than others and it can be difficult to raise this subject. If you as a child are worried that your relationship with your parent may be damaged by raising these issues, a subtle approach may work best. Consider relating what a friend is going through with her own elderly parents and use that as a spring board to raise the issue of how you’re worried about what to do if it ever happens to them. Many elderly parents don’t want their children to feel burdened and will be more motivated to address certain issues if they see the potential negative impact their problems could have on their adult child. If there are siblings involved, try to reach a consensus beforehand. A united front can be more effective.

 

  1. A range of options are available based on existing mental capacity.   Depending on how receptive the parent is, the first step is generally to meet with an elder law attorney who can lay out the options. Hopefully the parent still has some capacity in decision-making and can dictate what he or she wants. They can then be walked through the process of appointing financial and health care powers of attorney, which saves the process of going through court to have a legal guardian appointed. An elder law attorney also can lay out common techniques that can be employed or pitfalls to be avoided when managing the affairs of an aging parent, as well as putting you in contact with a wide range of support resources in the community who are available to help in such a situation such as geriatric care managers, home health agencies, and daily money managers.

 

Throughout the process, don’t forget that remaining as independent and autonomous as possible may be critical to your elderly parent’s long term well-being and happiness. Obviously, safety and independence must be balanced and decline often continues. However, taking the time to recognize their dignity and promoting independence whenever possible can go a long way in sustaining their quality of life into the future.