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Author: Stephanie Hon

Estate Planning For A Child With Special Needs: What Parents Need To Know

Estate planning is an obvious concern for all parents, but if you have a child with special needs, it’s crucial that you are aware of the unique considerations that go into planning for a child who may be dependent on you at some level for their lifetime. If your child has special needs, you must understand exactly what’s necessary to provide for the emotional, physical, and financial needs of your child, in the event of your own eventual death or potential incapacity.

When creating your estate plan, there are two major considerations for you to focus on: 1) Who would care for your child if and when you cannot (also known as guardianship), and 2) How will your child’s financial needs be met when you are not there to meet them.  

 

Naming Legal Guardians for a Lifetime of Care
The first and most critical step in ensuring the future well-being of your child with special needs is to name both short and long-term legal guardians to take custody of and care for your child in the event of your death or incapacity. And as you well know, if your child will never become fully capable of independently caring for him or herself, your parenting responsibilities will continue on long after your child reaches adulthood.

Although this lifetime responsibility likely feels overwhelming, we’ve been told repeatedly by our clients who have a child with special needs that naming legal guardians and knowing their child will be cared for in the way they want, by the people they want, creates an immense sense of relief. Not only that, but we often build in unique plans through which the named guardians are carefully instructed—and even incentivized—to give your child the same level of attention and care you provide.

For example, we’ve created plans in which the named guardian is compensated for taking your child to dinner and the movies every week or participating in some similar activity if this is something your child enjoys doing with you. However, without written instructions (and perhaps compensation) built into your estate plan, fun activities like this are often neglected once you are no longer there.

For guidance on selecting the individual(s) best suited to serve as legal guardians and creating the proper instructions for them to provide your special needs child with the same level of care as you, consult with us as your Personal Family Lawyer®.

 

Providing For Your Child’s Financial Future: Special Needs Trusts

Beyond naming legal guardians for your child with special needs, you’ll also need to provide financial resources to allow your child to live out his or her life in the manner you desire. And this is where things can get tricky for children with special needs.

In fact, it may seem like a “Catch-22” situation—you want to leave your child enough money to afford the care and support he or she needs to live a comfortable life, yet if you leave money directly to a person with special needs, you risk disqualifying that individual for much-needed government benefits like Medicaid and Supplemental Social Security Income (SSI).

Fortunately, the government allows assets to be held in what’s known as a “special needs trust” to provide supplemental financial resources for a physically, mentally, or developmentally disabled child, without affecting his or her eligibility for public healthcare and income assistance benefits. However, the rules for such trusts are complicated and can vary greatly between states, so you should always work with us, your Personal Family Lawyer® in order to create a comprehensive special needs trust that’s properly structured and appropriate for your child’s specific situation.

 

Setting Up The Trust

Funds from a special needs trust cannot be distributed directly to your child, and instead must be disbursed to a third party who’s responsible for managing the trust. Given this, when you initially set up the trust, you will likely be both the Grantor (trust creator) and Trustee (the person responsible for managing the trust), and your child with special needs is the trust’s Beneficiary.

You’ll then name the person you want responsible for administering the trust’s funds upon your death or incapacity as the Successor Trustee. To avoid conflicts of interest, overburdening the legal guardian with too much responsibility, and providing a system of checks and balances, it may be a wise decision to name someone other than your child’s legal guardian as a Trustee.

As the parent, you serve as the Trustee until you die or become incapacitated, at which time the Successor Trustee takes over. Each person who serves as Trustee is legally required to follow the trust’s terms and use its funds and property for the benefit of your special needs child.

Additionally, you should name multiple Successor Trustees—which can even be a trust company, bank, or another professional fiduciary—as backups in case something happens to prevent the individual you’ve named as primary Trustee from serving.

There are two ways to set up a special needs trust. In the first option, we build it into your revocable living trust, and it will arise, or spring up, upon your death. From there, assets that are held in your living trust will be used to fund your child’s special needs trust.

In the other option, we can set up a special needs trust that acts as a vehicle for receiving and holding assets for your child right now. This option makes sense if you have grandparents or other relatives who want to give your special needs child gifts sooner rather than later.

Finally, it is important to ensure that the trust will have sufficient funds to last throughout the life of your child. One common method to provide funding is for you (or another loved one) to name the special needs trust as the beneficiary of your life insurance policy. Another way is for family members and friends to make donations or gifts to the trust and/or include it as a beneficiary in their will.

Meet with us, as your Personal Family Lawyer®, to discuss all of your available options for ensuring your child’s special needs trust has sufficient funds to last for his or her lifetime and for guidance on the estate planning vehicles best suited for passing money to the trust.

 

The Trustee’s Role

Once the trust is funded, it’s the Trustee’s job to use the trust funds to support your child without jeopardizing eligibility for government benefits. To ensure this is handled properly, the Trustee must have a thorough understanding of how eligibility for such benefits works and stay current with the ever-changing laws. The Trustee is also required to pay the beneficiary’s taxes, keep detailed records, invest trust property, and stay current with the beneficiary’s needs.

Given this immense responsibility, it’s often best that you name a legal or financial professional who’s familiar with the complexities of the law as Trustee or Co-Trustee, so they can properly handle the duties and not jeopardize your child’s eligibility for government benefits. Alternatively, we can advise your named personal Trustee on how to manage the Trust.

 

Your Trusted Source For Special Need Planning
If you have a child with special needs, meet with us, as your Personal Family Lawyer®, for trusted guidance and support in creating a special needs trust and other estate planning vehicles for your child. We offer an array of estate planning strategies that are designed to accommodate the unique needs presented by a child with special needs and their families. 

We will assist you in passing on the financial assets needed for your child to have a rich quality of life, without jeopardizing his or her eligibility for government benefits. We’ll also support you in finding and appointing a legal guardian and/or Trustee to ensure your child is protected and provided for in the exact manner you wish when you die or if you become incapacitated. Contact us, your Personal Family Lawyer® today to get started.

 

This article is a service of Stephanie Hon, Personal Family Lawyer®. We do not 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. You can 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.

3 Estate Planning Issues For LGBTQ+ Couples—Part 2

Whether you are married or not, if you are involved in a committed partnership with another individual, estate planning is about so much more than planning for death—it’s about planning for life and ensuring your beloved will be protected and provided for no matter what happens to you. And if you are a member of the LGBTQ+ community, estate planning is even more critical, especially if you have complex family relationships.

Although same-gender marriage is legally recognized in all 50 states, long-held prejudice at both the political and family level continues to create complications for both married and unmarried same-gender couples. Indeed, while the federal government recognizes same-gender marriage, there are plenty of cities, businesses, and people who still refuse to recognize these unions. Moreover, a recent survey found that roughly four of every 10 LGBTQ adults say they have been rejected by a family member because of their sexual orientation or gender identity. As we discussed last week in part one, such discrimination can create unique estate planning challenges, and regardless of your marriage status, if you are an LGTBQ adult in a committed partnership, you should be aware of several issues that can affect your planning strategies. Specifically, we discussed how relying on a will alone may not provide sufficient protection for your partner/spouse, and we explained why incapacity planning is particularly crucial if you want your partner/spouse to have a say in your medical treatment and the ability to access and manage your assets in the event you are hit with a debilitating illness or injury. 

 

Here we’ll address the final issue you should be aware of when creating your estate plan—securing parental rights for the non-biological parent of minor children.

  1. Estate Planning Offers Alternative to Adoption
    Although married same-gender couples now enjoy nearly all of the same rights as opposite-gender couples, there is one key right that’s still up in the air—the automatic right to be legal parents. While parental rights are of course automatically bestowed upon the biological parent of a child, the non-biological spouse/parent still faces a number of challenges when it comes to obtaining full parental rights.

    Since the Supreme Court has yet to rule on the specific issue of the parental rights of the non-biological parent in a same-gender marriage, there is a tangled, often contradictory, web of state laws governing such rights. If you are a married same-gender couple, for example, some states consider the non-biological partner a legal parent based solely on your marriage, while other states do not.

Given the conflicting nature of state laws, many same-gender couples have turned to second-parent adoption to gain parental rights for the non-biological parent, since the Supreme Court has ruled that the adoptive parental rights granted in one state must be respected in all states. However, it can be extremely difficult for same-gender couples to adopt. In fact, 11 states currently permit state-licensed adoption agencies to refuse to grant an adoption, if doing so violates the agency’s religious beliefs. In other states, the law specifically forbids such discrimination, but given the Supreme Court’s ruling last week in Fulton v. City of Philadelphia, even those laws are susceptible to legal challenge.

In that case, the city canceled a contract with Catholic Social Services (CSS), a taxpayer-funded, faith-based foster care and adoption agency, after it refused child placement with LGBTQ families in violation of a city law prohibiting anti-LGBTQ discrimination. CSS sued the city, arguing that requiring it to follow the nondiscrimination policy violated its free exercise of religion since working with same-sex couples would go against its religious opposition to homosexuality.

In a unanimous judgment, the Supreme Court ruled in favor of CSS and found Philadelphia’s contract with CSS to be unenforceable. However, the ruling was narrowly focused on specific contractual language, and it does not create a broad free-exercise exemption from nondiscrimination laws, as many in the LGBTQ+ community feared. 

That said, the Fulton case and others like it that are sure to follow, demonstrate that when it comes to same-gender couples seeking parental rights, second-parent adoption is not a panacea. Fortunately, same-gender couples do have an alternative to adoption—estate planning. Indeed, using a variety of estate planning strategies, as your Personal Family Lawyer®, we can provide a non-biological, same-gender parent with nearly all parental rights, even without formal adoption.

Starting with our Kids Protection Plan®,  LGBTQ couples can name the non-biological parent as the child’s legal guardian, both for the short-term and the long-term, while confidentially excluding anyone the biological parent thinks may challenge their wishes. In this way, if the biological parent becomes incapacitated or dies, their wishes are clearly stated, so the court can do what the parent would’ve wanted and keep the child in the non-biological parent’s care.

Beyond that, there are several other estate planning vehicles—living trusts, power of attorney, and health care directives—we can use to grant the non-biological parent additional rights. We can also create “co-parenting agreements,” which are legal agreements that stipulate exactly how the child will be raised, what responsibility each partner has toward the child, and what kind of rights would exist if the couple splits or gets divorced.

 

Experience You Can Rely On
In light of these issues, it’s vital for LGBTQ+ couples, especially those with children, to always work with experienced estate planning lawyers, and avoid using generic online documents at all costs. As your Personal Family Lawyer®, we have the experience of creating plans specifically designed to prevent your plan from being challenged in court by family members who disagree with your relationship.

Indeed, with the proper planning, we can ensure that no matter what happens to you, your partner and family will be protected and provided for in the exact manner you wish, rather than being stuck in a financial and legal nightmare. What’s more, our specialized planning services can help ensure that non-biological parents in LBGT partnerships have as many parental rights as possible, without resorting to second-parent adoption. Contact us, your Personal Family Lawyer® today to get started with a Family Wealth Planning Session.

This article is a service of Stephanie Hon, Personal Family Lawyer®. We do not 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. You can 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. 

3 Estate Planning Issues For LGBTQ+ Couples—Part 1

Whether you are married or in a committed partnership, estate planning is about much more than planning for death—it’s about planning for life. It’s the way to ensure your beloved will be protected and provided for in the event of your death or incapacity. Especially if you are a member of the LGBTQ+ community, estate planning is even more critical.

Although same-gender marriage is legally recognized in all 50 states, long-held prejudice at both the political and family level continues to create complications for both married and unmarried same-gender couples. For example, suppose you have family members who are opposed to your marriage. In that case, your estate plan may be more likely to be disputed or even sabotaged by unsupportive relatives. This could mean that family members are more likely to contest your wishes, or it might result in custody battles over non-biological children in the event of the biological parent’s death.

Unsupportive family members may even try to block the ability of your partner to make medical decisions on your behalf should you become incapacitated by accident or illness. Even worse, your family members could try to kick your partner out of a shared home, if you are in an accident or fall ill, or they may even block your partner from seeing you if you require hospitalization.

Additionally, if you and your partner are unmarried, your partner would have no rights or protections should you become incapacitated or die without any planning in place, which leaves your partner vulnerable to several potentially dire risks.

Given these issues, if you are in a committed partnership, you should be aware of several unique considerations regarding your estate plan. While you should meet with us, your Personal Family Lawyer®, to address your specific circumstances, here are three of the most pressing concerns to keep in mind. 

  1. A Will Alone Might Not Be Enough

Suppose you’re unmarried and die without any estate plan. In that case, your property will be shared with your surviving family members according to your state’s laws through intestate succession. The state’s laws would not protect your unmarried partner, so if you want your partner to receive any of your assets upon your death, you need to—at the very least—create a will.

However, having an estate plan that consists solely of a will often doesn’t provide sufficient protection for your spouse/partner, and we often recommend that same-gender couples—even those who are married—create both a will and a trust. Although a will is a foundational part of nearly every estate plan, for a variety of reasons, having just a will could leave your partner/spouse at risk.

Most importantly, a will does not work in the event of your incapacity, which could happen at any time before your death. Should you become incapacitated with only a will in place, your partner/spouse may not have access to needed funds to pay bills, or they might even be kicked out of your home by a family member appointed as your guardian during your incapacity. 

Furthermore, upon your death, a will is required to go through the often long, costly, and potentially conflict-ridden court process known as probate. In contrast, assets that are properly titled in the name of your trust would pass directly to your partner/spouse upon your death, without the need for probate or any court intervention

If your relationship is not supported by one or both families, avoiding probate is especially important. If a family member doesn’t support your relationship, they are more likely to contest your will during probate.

If your will is successfully contested, this could prevent your surviving partner/spouse from receiving assets you left in your will. The process of contesting is extremely time-consuming, costly, and emotionally draining for your surviving partner/spouse.

Typically, when an attorney drafts your will, it is not set up to protect your assets after they are passed to your partner/spouse from creditors or lawsuits. However, leaving your assets in a trust that your partner/spouse can control would ensure the assets are protected from creditors, future relationships, and/or unexpected lawsuits.

 

  1. Incapacity Planning is Especially Vital

As we touched on earlier, estate planning is not just about planning for your eventual death; it’s also about planning for your potential incapacity due to injury or illness. Proactive estate planning allows you to name the person (or persons) you would want to make your healthcare, legal, and financial decisions for you if you are incapacitated and unable to make such decisions yourself through a medical power of attorney.

If you haven’t planned for incapacity, the choice is then left to the court to appoint the person(s) to make these decisions on your behalf. If you’re unmarried and the court appoints one of your relatives as your guardian, your family could leave your partner totally out of the medical decision-making process and even deny them the right to visit you in the hospital. And even if you are married, it’s not guaranteed that your spouse would have the ultimate legal authority to make such decisions.

Though the court typically gives spouses priority as guardians, this isn’t always the case, especially if unsupportive family members challenge the issue in court. To ensure your partner/spouse has the ability to make these decisions for you, you must grant them the legal authority to do so using medical power of attorney and durable financial power of attorney.

A durable financial power of attorney gives your spouse the authority to manage your financial, legal, and business affairs, including paying your bills and taxes, running your business, selling your home, as well as managing your banking and investment accounts.

In addition to creating a will and trust, be sure to also create a living will, so that your spouse will know exactly how you want your medical care managed in the event of your incapacity, particularly at the end of life. Finally, don’t forget to provide your partner/spouse with HIPAA authorization within the medical power of attorney, so they will have access to your medical records to make educated decisions about your care. 

As your Personal Family Lawyer®, we can support you in putting in place a robust estate plan that will ensure that your partner/spouse has the maximum rights possible if you are ever struck by a debilitating accident or illness.

Next week, in part two, we’ll discuss the final estate planning consideration for LGBTQ couples—securing parental rights for the non-biological parent of minor children


This article is a service of Stephanie Hon, Personal Family Lawyer®. We do not 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. You can 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. 

Britney Spears’ Nightmare Conservatorship Underscores The Vital Importance Of Incapacity Planning—Part 2 

Since the age of 16, when she burst onto the charts with her debut single, “…Hit Me Baby One More Time,” Britney Spears has been one of the world’s most famous and beloved pop stars. Yet despite her massive fame and fortune, Britney, who is now 39, has never truly had full control over her own life.

As most familiar with pop culture know by now, Britney has been living under a conservatorship for the past 13 years. Also known as “adult guardianship,” a conservatorship is a legal structure in which the court granted Britney’s father, Jaime Spears, and other individuals nearly complete control over her legal, financial, and personal decisions. The conservatorship was initially established in February 2008 after Britney suffered a mental breakdown, which resulted in her being briefly hospitalized.



A Total Loss of Control
Back in 2008, the court-appointed Britney’s father and attorney Andrew Wallet as her co-conservators, as Britney was deemed mentally unfit to care for herself. The arrangement was only meant to be temporary, but in October of that year, the conservatorship was made long-term, and her father has remained in nearly complete control of Britney’s life ever since.

Although there has been widespread speculation that Britney’s conservatorship was abusive, the exact details of her conservatorship have been kept private. Moreover, until very recently, Britney had never spoken publicly about her life under the arrangement.

Years of Abuse and Conflict
However, as we detailed last week in part one, Britney recently testified in a court hearing during which she described a shocking pattern of abuse and exploitation at the hands of her father and others involved with the conservatorship. We also discussed how confidential court records obtained by the New York Times provided support for Britney’s claims and showed that the pop icon had expressed serious opposition to her conservatorship as early as 2014, and tried unsuccessfully on multiple occasions to have her father removed from his position.

In response, Britney’s father flatly denied any wrongdoing, and his lawyers filed a petition requesting the court investigate Britney’s allegations of abuse. Shortly after the hearing, both Britney’s court-appointed lawyer, Samuel Ingham, and Bessemer Trust, the wealth management company, which had previously signed on to be the co-conservator of Spears’ finances, asked the court to be removed from the pop star’s conservatorship.

In a follow-up court hearing held this week on July 14th, Judge Brenda Penny approved the resignation of Ingham and Bessemer Trust and granted a request by Britney to hire her own lawyer. To represent her moving forward, Britney chose Mathew Rosengart, a prominent Hollywood litigator and former federal prosecutor, as her new attorney. 

Britney, who phoned into the hearing, once again asked the court to remove her father as co-conservator, and she said that her father should be prosecuted for his alleged abuse. But Britney also reiterated that she’s not willing to undergo any more mental-health evaluations, which she called “stupid psych tests,” according to a report by NPR.

“I’m not willing to sit with anybody at this point to be evaluated,” Britney said. “I want to press charges for abuse. Instead of investigating my capacity, I want an investigation on my dad.”

Although Britney still hasn’t filed the formal legal document seeking to end her conservatorship, which is required by law, her new lawyer, who was present at the latest court hearing, told the judge he plans to file the petition to remove Jamie Spears from the conservatorship. If so, the judge could rule on the petition in the next court hearing on the conservatorship, which is scheduled for September 29.

 

Use Estate Planning To Avoid Britney’s Fate
Although we’ll have to wait to find out whether the court will allow Britney to terminate the conservatorship without undergoing another psychiatric evaluation, as we noted last week, Britney could have been saved from the years of control by her father,  if she had created a proper estate plan early on in her adult life.

In fact, using a variety of different estate planning vehicles, Britney could have not only chosen the person, or persons, who would be in charge of making decisions on her behalf during her incapacity, but she could have also created legally binding instructions stipulating how her assets and personal care should be managed during her incapacity. With the right planning, Britney could have even spelled out the specific conditions that must be met for her to be deemed incapacitated in the first place.

With this in mind, here in part two, we’ll discuss how you and your loved ones can use proactive estate planning to create a comprehensive plan for incapacity, so you can avoid suffering the same fate as Britney. And since a debilitating illness or injury could strike at any time, at any age, if you’ve yet to create your own incapacity plan, contact me, your Personal Family Lawyer® right away to get this urgent matter taken care of.

 

Planning For Incapacity: Where To Start
When planning for your potential incapacity, the first thing to ask yourself is, “If I’m ever incapacitated and unable to care for myself, who would I want to make decisions on my behalf?” Specifically, you’ll be selecting the person, or persons, you want to make your healthcare, financial, and legal decisions for you until you either recover or pass away.

The most important thing to remember is that you must choose someone. Like we’ve seen with Britney, if you don’t legally name someone to make these decisions during your incapacity, the court will choose someone for you. And this is where things can get extremely difficult for you and your loved ones.

Although laws differ by state, in the absence of any estate planning, if you become incapacitated, the court will typically appoint a conservator or guardian to make financial and legal decisions on your behalf. As with Britney, this person could be a family member you’d never want managing your affairs, a professional guardian who charges exorbitant fees, or even a crooked professional guardian who abuses and exploits you for their own financial gain

Furthermore, like most court proceedings, the process of naming a guardian can be quite lengthy, costly, and emotionally draining for your family. And this is assuming your family members agree about what’s in your best interest. If your family members disagree about the course of your medical treatment or managing your finances, this could lead to ugly court battles between your loved ones.

Such conflicts can tear your family apart and drain your estate’s finances. For an example of just how bad things can get, look at the case of Florida’s Terry Schiavo, who spent 15 years in a vegetative state after suffering a heart attack at age 26. Because Terry did not have a living will or health care directive indicating in writing how she would want medical decisions made for her in such an event, Schiavo’s young husband fought Terry’s parents in court for more than a decade for permission to remove her from life support before she was ultimately allowed to pass away. 

 

A Comprehensive Incapacity Plan
Fortunately, such turmoil can be easily avoided through proper estate planning. Determining which estate planning strategies you should use to grant and guide this decision-making authority depends entirely on your personal circumstances. There are several options available, but choosing what’s best for you is something you should ultimately decide after consulting with an experienced lawyer like us because there are many considerations beyond simply whether to “pull the plug”, including how to handle such matters in the event of a pregnancy, whether to keep providing hydration and nutrition (and, if so, what kind), and how to determine incapacity. These, and other factors, are not typically addressed in a standard advance health care directive. 

That said, we can tell you one estate planning tool that’s totally worthless when it comes to your incapacity—a will. A will only goes into effect upon your death, and then it merely governs how your assets should be distributed, so having a will does nothing to keep your family out of court and out of the conflict in the event of your incapacity.

When it comes to creating your incapacity plan, your best bet is to put in place an array of different planning tools, rather than a single document. To this end, your plan should include some, or all, of the following:

Durable financial power of attorney: This document grants an individual of your choice the immediate authority to make decisions related to the management of your financial, business, and legal affairs, and can state how your affairs should be handled.

 

Revocable living trust: A living trust can immediately transfer control of your assets held by the trust to a person of your choice to be used for your benefit in the event of your incapacity. The trust can include legally binding instructions for how your assets should be managed, and the document can even spell out specific conditions that must be met for you to be deemed incapacitated.
Medical power of attorney: An advance directive that grants an individual of your choice the immediate legal authority to make decisions about your medical treatment in the event of your incapacity.

Living will: An advance directive that provides specific guidance about how your medical decisions should be made during your incapacity, including who should be able to see you and specifics regarding how you want your care to be handled. In some instances, a medical power of attorney and a living will are combined in a single document.

Documents Aren’t Enough
In the end, there’s one thing to remember about all of these documents—they are just documents, and they don’t provide your loved ones with a trusted advisor who is often needed to deal with all potential outcomes, and to navigate the legal system on your behalf. If you really want to keep your family out of court and out of conflict, you cannot just rely on documents to do it. Instead, these documents should be created by a lawyer like us who will get to know you, your wishes, and be there for you throughout the many stages of life—and ultimately be there for your family when you can’t be.

Furthermore, in addition to the above estate planning documents, it’s equally—if not more—important for your loved ones to be aware of your plan and understand their role in it. As part of the planning process, a Personal Family Lawyer® will hold a family meeting with all of the individuals impacted by your plan, where we walk them through your plan, explaining the reasoning behind your decisions and what they need to do if something happens to you.

 

In the end, you’ll find that the best protection comes from combining your comprehensive incapacity plan with a team of people who will care for you, can watch out for you, and know exactly what to do in the event tragedy strikes. As your Personal Family Lawyer®, we can guide and support you to put in place both of these elements. In doing so, it would make it virtually impossible for a conservator or legal guardian to ever be appointed—or even need to be appointed—against your wishes, and instead, we will create a robust plan that would allow you to stipulate how your life, healthcare, and assets should be managed if you ever become unable to manage them yourself.

 

Timing Is Everything

Keep in mind that your incapacity plan must be created well before you become incapacitated. You must be able to clearly express your wishes and consent in order for these planning documents to be valid, and even slight levels of mental illness or dementia could get them thrown out of court.

Plus, as we mentioned earlier, an unforeseen accident or illness could strike at any time no matter your age, so don’t wait—contact us right away to get your incapacity plan started.

Finally, it’s vital that you regularly review and update your estate plan to keep pace with changes to your life, family dynamics, and the law. If any of the individuals you’ve named becomes unable or unwilling to serve for whatever reason, you’ll need to revise your plan accordingly, and we can help with that, too. 

 

Let Britney’s Story Be A Lesson

Although Britney’s story is certainly tragic and we can’t be sure how it will ultimately play out, her case has at least shined a spotlight on the potential for abuse that exists within the conservatorship and guardianship system. In fact, Britney’s case has already inspired lawmakers at both the state and federal level to take a closer look at adult guardianships and push for increased oversight and transparency for these legal arrangements.

As one Congresswoman from Massachusetts told Politico, “If this could happen to someone who is as famous as Britney Spears, I mean, think about what’s happening to regular Americans. We need to pull back the curtain on this.” said Rep. Lori Trahan. 

By the same token, Britney’s story should inspire you to make certain that you and your loved ones have the proper estate planning strategies in place to prevent the loss of autonomy, family conflict, and potential for abuse that comes with court-ordered conservatorships and guardianships.

To this end, if you’ve yet to plan for incapacity, schedule a Family Wealth Planning Session™ right away, we, your Personal Family Lawyer®, can advise you about the most suitable estate planning vehicles to put in place. And if you already have an incapacity plan prepared—even one created by another lawyer—we can review it to make sure it’s been properly set up, maintained, and updated. Contact us, your Personal Family Lawyer® today to plan for your life.

 

This article is a service of Stephanie D. Hon, Personal Family Lawyer®. We do not 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. You can 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. 

Britney Spears’ Nightmare Conservatorship Underscores The Vital Importance Of Incapacity Planning—Part 1 

Since the age of 16, when she burst onto the charts with her debut single, “…Hit Me Baby One More Time,” Britney Spears has been one of the world’s most famous and beloved pop stars. Yet despite her massive fame and fortune, Britney, who is now 39, has never truly had full control over her own life.

As most familiar with pop culture know by now, Britney has been living under a conservatorship for the past 13 years. Also known as “adult guardianship,” a conservatorship is a legal structure in which the court granted Britney’s father, Jaime Spears, and other individuals nearly complete control over her legal, financial, and personal decisions. The conservatorship was initially established in February 2008 after Britney suffered a mental breakdown, which resulted in her being briefly hospitalized.

A Total Loss of Control
Back in 2008, the court-appointed Britney’s father and attorney Andrew Wallet as her co-conservators, as Britney was deemed mentally unfit to care for herself. The arrangement was only meant to be temporary, but in October of that year, the conservatorship was made long-term, and her father has remained in nearly complete control of Britney’s life ever since.

Under the conservatorship, Britney’s father has the power to restrict her visitors; he is in charge of arranging and approving her visits with her own children; he has the authority to make her medical decisions; and he has the final say in all of her business deals, including when she works, and the complete authority over all of her financial matters.

As it stands now, Britney’s current mental-health status remains unclear, and we can’t be sure whether or not she still requires someone to help her manage her financial and business affairs. But what is abundantly clear is that given the chance, Britney would have undoubtedly preferred to have some say in not only who should be in charge of making decisions on her behalf during her incapacity, but also how those decisions should be made.

Yet because Britney did not create legal documents indicating who should make decisions for her if she could not make decisions for herself, a judge decided for her—and as you’ll read below, this has resulted in immense trauma for Britney and destroyed her relationship with her father. With this in mind, here in this series of articles, we will first discuss the latest details on Britney’s conservatorship and the impact the arrangement has had on the pop star’s life and career. From there, we’ll discuss how you can prevent something similar from happening to you and your loved ones using proactive estate planning and our Family Wealth Planning process. 

 

Years Of Abuse And Conflict
Although there has been widespread speculation that Britney’s conservatorship was abusive, the exact details of her conservatorship have been kept private. Moreover, until very recently, Britney had never spoken publicly about her life under the arrangement. 

Britney’s father and others involved with the conservatorship have consistently maintained the arrangement saved Britney from herself and others looking to exploit her when she was at her lowest point. They described how the conservatorship helped pull Britney out of debt and allowed her to earn a fortune estimated to be worth nearly $60 million. Plus, representatives for the conservatorship have noted that Britney could move to end the conservatorship whenever she wanted.

However, two shocking developments within the past few weeks finally revealed just how much Britney has suffered under the conservatorship and how she has fought unsuccessfully for years to regain control of her life from her father. The first was a report published by the New York Times on June 22

According to confidential court records obtained by the newspaper, Britney had expressed serious opposition to her conservatorship as early as 2014, and on multiple occasions, the pop icon pushed for her father to be removed from his position. The very next day in a public court hearing on June 23, Britney finally broke her silence, and what she described was stunning.

During an emotional 24-minute speech delivered via Zoom, Britney pleaded with Judge Brenda Penny to end the conservatorship under which she claimed she has endured years of abuse and exploitation, including having to take a powerful mood stabilizer that makes her feel drunk, being compelled to work while seriously ill, and being forced to remain on birth control, so she can’t have more children. (Read a full transcript of Britney’s testimony)

In response, Britney’s father vehemently denies any wrongdoing and insists he’s acting in his daughter’s best interests. In fact, a few days later, his lawyers filed a petition requesting the court investigate Britney’s allegations of abuse. According to the petition, if Britney’s claims prove true, then “corrective action must be taken,” and if not, then the conservatorship “can continue its course.” 

A week later, Judge Penny denied Britney’s request to remove her father as conservator. However, the judge’s ruling was only in response to a filing by Britney’s lawyer made in November 2020 to have a wealth management company, Bessemer Trust, take over as sole conservator, and was not in response to Britney’s impassioned testimony. As it turns out, Britney’s court-appointed lawyer, Samuel Ingham, has yet to file a formal petition to terminate the conservatorship, but the judge said she would be open to such a filing.

According to CNN, Britney has since instructed Ingraham to immediately file the necessary paperwork in order to formally terminate the conservatorship once and for all. If filed, the judge could rule on Britney’s petition and her father’s request for an investigation in the next court hearing on the conservatorship, which is scheduled for next week on July 14.

 

A Broken System
Britney’s story highlights the real potential for abuse that exists within the conservatorship and guardianship system. In fact, as we’ve covered in previous articles, there have been dozens of highly publicized reports in recent years involving corrupt professional guardians, who exploit those under their care for their own financial gain. Yet, in those cases, the victims have nearly all been elderly, and their abusers were strangers. But Britney’s situation makes it clear that people of any age can fall prey to these restrictive legal arrangements, and the abusers can even be your own family members.

Furthermore, and perhaps the most puzzling part of the whole situation, is why someone as young and active as Britney is still living under a conservatorship. Conservatorships and guardianships are typically used to protect the elderly and mentally disabled who are incapable of making their own decisions and caring for themselves, and they often remain in effect until the person dies.

Although Britney may have initially needed the conservatorship to protect her from her own poor decisions and others looking to take advantage of her in the aftermath of her breakdown in 2008, since then, the Grammy winner has worked almost nonstop and earned millions of dollars. In fact, over the past decade during which she was deemed “incapable of making her own decisions,” Britney has released four albums, headlined multiple world tours, performed nearly 250 shows in a Las Vegas residency, and served as a judge on the TV show “The X Factor.”
 

That said, due to the private nature of her conservatorship and the fact that Britney has never fully disclosed the specifics of her diagnosis, we don’t know the full circumstances of her mental health. Although there have been rumors and speculation that Britney is suffering from bipolar disorder, this has never been substantiated, and her medical records are sealed.

What’s more, although it was reported in 2019 that Britney checked herself into a mental health facility and was prescribed lithium, an older medication that’s used to treat bipolar disorder, according to court records obtained by the New York Times, this wasn’t entirely true. In 2019, Britney testified that she was forced into the facility against her will, and during her most recent testimony, she told the judge that she was forced to take the lithium against her wishes as well.

In the end, if Britney does petition to terminate her conservatorship, she will need to prove to the court that she currently possesses the capacity to handle her own life, health, and financial choices. In order to do this, however, Britney will almost certainly have to undergo another mental health evaluation, which would likely involve a court hearing and testimony from mental health professionals.

In an interview with the culture and music website Vulture, Tamar Arminak, a conservatorship attorney who worked on a similar conservatorship involving 27-year-old actress Amanda Bynes, said that the process to prove Britney’s capacity would likely involve a “mini-trial” to determine whether the conservatorship continues to be in the singer’s best interest.

“You have to present evidence and show a changed circumstance,” said Arminak. “You will have to have testimony from doctors, psychiatrists, therapists, and witnesses who will testify for you that you shouldn’t be under this conservatorship.”

Unfortunately, undergoing yet another mental health evaluation is something Britney is hesitant to do. Indeed, in her recent testimony, she made this point clear. “I truly believe this conservatorship is abusive… I want to end the conservatorship without being evaluated,” Britney told the judge.

According to Vanity Fair, a source close to Britney said the reason for Britney’s reluctance to undergo another mental health examination is due to the fact that she has had such poor experiences over the years with the doctors hired by her father. 

“She doesn’t have much trust for the doctors that she has worked with so far,” the source said. “She feels like they have failed her.”

 

The source went on to say that Britney’s reluctance to be evaluated is also one of the reasons her lawyer has yet to formally file the petition to end the conservatorship. After her past experiences with mental health professionals, it’s understandable that Britney would be hesitant to trust yet another doctor hired by her father or appointed by the court.

However, if Britney wants to finally be free and have full control over her life, that might be the only choice she has.

 

Avoid Britney’s Fate With Incapacity Planning

Whether it’s mental illness, age-related dementia, or a serious accident, we are all powerless to prevent the potential for incapacity. However, with the proper estate planning, you can at least have control over how your life, healthcare, and assets will be managed if something does happen. Moreover, such planning can also prevent your family from enduring the bitter conflict and expense that can result when you leave control over your life in the hands of the court like Britney did.

Working with us, your Personal Family Lawyer®, we can put an array of estate planning vehicles in place that would make it practically impossible for a conservator or legal guardian to ever be appointed—or even need to be appointed—against your wishes. In part two, we’ll outline those options in more detail, but to learn more, contact us today.

 

We’ll continue with part two in this series on Britney Spears’ conservatorship and how you can avoid the potential for abuse, conflict, and expense of court-ordered conservatorship using estate planning.

This article is a service of Stephanie D. Hon, Personal Family Lawyer®. We do not 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. You can 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. 

Legal Gangsters: Netflix’s I Care a Lot Uncovers the Dark Side of Legal Guardianship – Part 2

The Netflix movie I Care a Lot provides a dark, violent, and somewhat comedic take on the real-life and not-at-all funny dangers of the legal (and sometimes corrupt) guardianship system. While the film’s twisting plot may seem far-fetched, it sheds light on a tragic phenomenon—the abuse of seniors at the hands of crooked “professional” guardians.

Last week in part one of this series, we offered a brief synopsis of the movie, which revolves around Marla Grayson, a crooked professional guardian who makes her living by preying on vulnerable seniors, and we then outlined the true events that inspired the fictional account. The film’s writer and director, J. Blakeson, came up with the idea after reading news stories of a similar scam involving a corrupt professional guardianship agency in Las Vegas.

In that case, a real-life Marla Grayson named April Parks, who owned a company called A Private Professional Guardian, was sentenced to up to 40 years in prison in 2018 after being indicted on more than 200 felonies for using her guardianship status to swindle more than 150 seniors out of their life savings. While I Care a Lot is fictional, the Parks case also inspired the 2018 documentary, The Guardians, directed by award-winning filmmaker Billie Mintz, and his film details the terrifying true events that ravaged the Nevada guardianship industry.

In a Facebook post, Mintz praises I Care a Lot as “a perfect introduction to guardianship,” but worries that because of the movie’s heavy focus on violence and Russian mobsters, “people won’t believe it’s real.” However, as Mintz points out, “I assure you that everything you see about guardianship is true.”

Indeed, while the Parks case is the most famous, similar cases of senior abuse by professional guardians are on the rise across the country. A 2010 report by the Government Accountability Office found hundreds of cases where guardians were involved in the abuse, exploitation, and neglect of seniors placed under their supervision. And given the country’s exploding elderly population and our overloaded court system, such abuse will almost certainly become more common.

Additionally, although most of the cases that have made the news have involved the elderly, the fact is, any adult could face court-ordered guardianship if they become incapacitated by illness or injury and haven’t put the proper legal protections in place.

To this end, here in part two, we’re going to explain how you can protect yourself and your loved ones from such abuse using proactive estate planning. 

 

How It Happens

Should you become incapacitated without any planning in place (due to illness or injury), your family (or a friend) would have to petition the court in order to be granted guardianship. In most cases, the court would appoint a family member as guardian, but this isn’t always the case. If you have no living family members, or those you do have are unwilling or unable to serve or deemed unsuitable by the court, a professional guardian would be appointed. 

Beyond the potential for abuse by professional guardians, if you become incapacitated and your family is forced into court seeking guardianship, they are likely to endure a costly, drawn-out, and emotionally taxing process. Not only can the legal fees and court costs drain your estate, but if your loved ones disagree over who is best suited to serve as your guardian, it could cause a bitter conflict that could tear your family apart and make it less likely that you get the kind of care you want.

In another scenario, should your loved ones disagree about who should be your guardian, the court could decide that naming a relative as your guardian would be too disruptive to your family dynamics and appoint a professional guardian instead. However, if you have the proper planning vehicles in place, it is highly unlikely for a guardian to be appointed against your wishes.

 

A Comprehensive Plan For Incapacity
Should you become incapacitated, a comprehensive incapacity plan would give the individual, or individuals, of your choice the immediate authority to make your medical, financial, and legal decisions, without the need for court intervention. Moreover, such planning allows you to provide clear guidance about your wishes, so there is no mistake about how these decisions should be made.

There are several planning vehicles that can go into a comprehensive plan for incapacity, but a will is not among them. A will only goes into effect upon your death, and then, it merely governs how your assets should be divided, so it would do nothing to protect you in the event of incapacity.

When it comes to creating your incapacity plan, your best bet is to put in place a number of different planning tools rather than a single document. To this end, your plan should include some or all of the following:

 

  • Durable financial power of attorney: This document grants an individual of your choice the immediate authority to make decisions related to the management of your financial and legal affairs.
  • Revocable living trust: A living trust immediately transfers control of all assets held by the trust to a person of your choice to be used for your benefit in the event of your incapacity. The trust can include legally binding instructions for how your care should be managed, and the document can even spell out specific conditions that must be met for you to be deemed incapacitated.
  • Medical power of attorney: A medical power of attorney grants an individual of your choice the immediate legal authority to make decisions about your medical treatment in the event of your incapacity.
  • Living will: A living will ((sometimes called an advance directive) provides specific guidance about how your medical decisions should be made during your incapacity, particularly at the end of life. In some instances, a medical power of attorney and a living will are combined in a single document.

But here is the thing about all of these documents—they are just documents and not guidance for the people you love. If you really want to keep your family and friends out of court and out of conflict, you cannot just rely on documents to do it. Rather, these documents should be created by a lawyer who will get to know you, your wishes, and be there for you throughout the many stages of life, plus be there for your family and friends if and when you can’t be.

 

Communication is Key

In addition to the above planning tools, it is equally—if not more—important for your loved ones to be aware of your plan and understand their role in it. As part of our planning process, we hold a family meeting with all of the individuals impacted by your plan where we walk them through your plan and explain the reasoning behind your decisions and what they need to do if something happens to you.

By combining your comprehensive incapacity plan with a team of people who care for you, can watch out for you, and know exactly what to do in the event tragedy strikes, we can make it virtually impossible for you to be abused by a professional guardian.

Don’t Put It Off
Although incapacity from dementia is most common in the elderly, debilitating injury and illness can strike at any point in life. Given this, all adults 18 and older should have an incapacity plan. Furthermore, planning for incapacity must take place well before any cognitive decline appears since you must be able to clearly express your wishes and consent for the documents to be valid.

In light of this, you should get your own planning handled first, and then discuss the need for planning with your aging parents as soon as possible, and from there, schedule a Family Wealth Planning Session with us to get a plan started. And if you or your senior loved ones already have an incapacity plan, we can review it to make sure it has been properly set up, maintained, and updated. Unfortunately, a plan put in place years ago is unlikely to work now, so updating is critical, and unfortunately often not overlooked.

Indeed, once you have a plan in place, make sure to regularly review and update it to keep pace with life changes, changes in your assets, or changes in your family structure. And if any of the individuals you have named become unable or unwilling to serve for whatever reason, you will need to revise your plan—and we can help with that too.

 

Retain Control of Your Life and Assets

To avoid the loss of autonomy, family conflict, and potential for abuse that comes with court-ordered guardianship, we invite you to meet with us as your Personal Family Lawyer®. While there is no way to prevent dementia and other forms of cognitive decline or an unexpected illness or injury, we can put planning tools in place to ensure that you at least have some control over how your life and assets will be managed if it ever does occur. Contact us today to schedule your appointment.

 

This article is a service of Stephanie Hon, 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. You can 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. 

Legal Gangsters: Netflix’s I Care a Lot Uncovers the Dark Side of Legal Guardianship – Part 1

The Netflix movie I Care a Lot provides a dark, violent, and somewhat comedic take on the real-life and not-at-all funny dangers of the legal (and sometimes corrupt) guardianship system. While the film’s twisting plot may seem far-fetched, it sheds light on a tragic phenomenon—the abuse of seniors at the hands of crooked “professional” guardians.

In this two-part series, we’ll discuss how the movie depicts such abuse, how this can occur in real life, and what you can do to prevent something similar from happening to you or your loved ones using proactive estate planning and our Family Wealth Planning process. For support in putting airtight, protective planning vehicles in place, meet with us as your Personal Family Lawyer®.

Note: This article contains spoilers for the movie I Care a Lot.

At the beginning of the movie, we meet Marla Grayson, a crooked professional guardian who makes her living by preying on vulnerable seniors. A professional guardian is a person appointed by the court to make legal and financial decisions for senior “wards” of the court, who are deemed unable to make such decisions for themselves.

Working with a corrupt doctor, Marla targets wealthy victims and gets a judge to order these individuals unfit to care for themselves and then appoint her as their guardian. From there, she and her business partner/ girlfriend, Fran, move the seniors into a nursing home, seize their homes, and sell all of their assets for their own financial gain.

Marla’s scheme takes a turn for the worse when her latest senior victim, Jennifer Peterson, turns out to be the mother of a Russian mob boss named Roman Lunyov. After Marla has Jennifer placed in a long-term care facility, Roman tries unsuccessfully to get his mother out of the facility, first by bribing Marla, then through the court, and finally by trying to break her out. 

While this may seem ludicrous, this kind of abuse actually happens outside of the movies to seniors with significant assets, even those with caring adult children like Roman. 

At this point, the movie descends into a violent back-and-forth between Roman and Marla, as they each try and fail to kill one another until they both decide that rather than murdering each other, they could make more money by going into business together. 

Fast forward to several years later, we learn that Marla and Roman have become millionaires after starting a global chain of senior care services, called Grayson Guardianships, which employs thousands of crooked guardians overseeing hundreds of thousands of “clients” all over the world.

 

Based On True Events

With its over-the-top violence, kidnappings, and Russian mobsters, some might dismiss I Care a Lot as nothing but Hollywood hype and find it hard to believe that an operation as sinister as Marla’s could ever actually exist. But the fact is, the movie’s writer and director, J. Blakeson, came up with the idea after reading news stories about very similar (less the mob and murder) situations. And knowing such things actually happen makes the movie even more terrifying.

“The idea first came when I heard news stories about these predatory legal guardians who were exploiting this legal loophole and exploiting the vulnerability in the system to take advantage of older people, basically stripping them of their lives and assets to fill their own pockets,” Blakeson told Esquire Magazine. “They run through their money as fast as possible, store them in the worst care home, and just forget about them. Just park them and then move on to the next one, and that felt almost like a gangster’s operation.”

And while the real-life scams never reached a level on par with Grayson’s Guardians, one crooked professional guardianship business in Las Vegas did manage to bilk hundreds of unsuspecting seniors out of their life savings. As we detailed in our previous article, Use Estate Planning to Avoid Adult Guardianship—and Elder Abuse, a real-life Marla Grayson named April Parks, who owned a Las Vegas-based company called A Private Professional Guardian, was sentenced to up to 40 years in prison in 2018 after being indicted on more than 200 felonies for using her guardianship status to swindle more than 150 seniors. 

In her case, prosecutors described how Parks, in a similar fashion as Marla, used a shady network of social workers and medical professionals who helped her track down her elderly victims. On the lookout for wealthy seniors with a history of health issues and few living relatives, Parks was often able to obtain court-sanctioned guardianship during court hearings that lasted less than two minutes.

From there, the guardians would force the elderly out of their homes and into assisted-living facilities and nursing homes. They would then sell off their homes and other assets, keeping the proceeds for themselves. Even worse, the guardians were often able to prevent the seniors from seeing or speaking with their family members, leaving them isolated and even more vulnerable to exploitation.

 

The Most Punitive Civil Penalty

What makes these cases particularly tragic is the fact that for the most part, everything these unscrupulous guardians did is perfectly legal. As Blakeson put it, “They had the law on their side, and there was nothing you could do.” Although guardianships are designed to protect the elderly from their own poor decisions, guardianship can turn out to be more of a punishment than a benefit. 

In a 2018 New York Times article detailing the state of the guardianship system in New York, Florida congressman Claude Pepper described guardianship as “the most punitive civil penalty that can be levied against an American citizen, with the exception, of course, of the death penalty.” 

Indeed, once you’ve been placed under court-ordered guardianship, you essentially lose all of your civil rights. Whether it’s a family member or a professional, the person named as your guardian has the complete legal authority to control every facet of your life. While guardianship is governed by state law and varies from state to state, some of the most common powers guardians are granted include the following:

  • Determining where you live, including moving you into a nursing home
  • Complete control over your finances, real estate, and other assets
  • Making all of your healthcare decisions and providing consent for medical treatments
  • Placing restrictions on your communications and interactions with others, including family members
  • Making decisions about your daily life such as recreational activities, clothing, and food choices
  • Making end-of-life and other palliative-care decisions 

Additionally, though it’s possible for guardianship to be terminated by the court if it can be proven that the need for guardianship no longer exists, a study by the American Bar Association (ABA) found that such attempts typically failAnd those family members who do try to fight against court-appointed guardians frequently end up paying hefty sums of money in attorney’s fees and court costs, with some even going bankrupt in the process.


Protection Through Planning

Given the potential for neglect, abuse, and exploitation that guardianship affords, it’s crucial that seniors and their families take the proper steps to prevent any and all possibility of falling prey to such scams. Moreover, because any adult could face court-ordered guardianship if they become incapacitated by illness or injury, it’s vital that every person over age 18—not just seniors—take proactive measures to prepare for potential incapacity.

Fortunately, there are multiple estate planning tools that can prevent such abuse from occurring. With us, as your Personal Family Lawyer®, we can put planning vehicles in place and offer ongoing advisory and support that would make it practically impossible for a legal guardian to ever be appointed—or need to be appointed—against your wishes.

Next week, we’ll continue with part two in this series on the dark side of adult guardianship and offer tips for how you can avoid the potential for abuse using estate planning.

 

This article is a service of Stephanie Hon, 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. You can 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. 

Why You Should Create a Trust To Protect Your Business and Family

Although you can invest in many different types of insurance to protect your business from lawsuits and other liabilities, one of the greatest liabilities you simply can’t avoid, especially if you are the sole owner of your business, is your incapacity or death.

To make certain that your business—and the income it generates for your family—would continue to run smoothly when something happens to you, you need to create a comprehensive estate plan, and it really needs to include a trust. Without such a plan in place, your business will be stuck in an unnecessary court process, and it could easily cause the loss of everything you’ve worked so hard to build.

 

A Will Alone Is Not Enough
When it comes to creating an estate plan, most people typically think of a will. While it’s possible to leave your company to someone in your will, it’s far from the ideal option. That’s because, upon your death, all assets passed through a will must first go through the court process known as probate. The cost of probate, the time of probate, and the complexity of a court making decisions about your business assets are wholly unnecessary. 

During probate, the court oversees your will’s administration to ensure your assets (including your business) are distributed according to your wishes. But probate can take months, or even years, to complete, and it can also be quite expensive, which can seriously disrupt your operation and its cash flow. What’s more, probate is a public process, potentially leaving your business affairs open to your competitors.

Furthermore, a will only goes into effect upon your death, so it would do nothing to protect your business should you become incapacitated by illness or injury. Indeed, if you only have a will in place (or have no estate plan at all), in the event of your incapacity, your family would have to petition the court for guardianship in order to manage your business and other personal and financial affairs.

Like probate, the court process associated with guardianship can be long and costly. And in the end, whether it’s a family member or professional guardianship agency, there’s no guarantee the individual the court ultimately names as guardian of your assets would be the best person to run your company.

 

Maximum Protection For Your Business and Family

Given the drawbacks associated with a will, a much better way to ensure your business’s continued success is by placing your company in a revocable living trust. A living trust is not required to go through probate, and all assets placed within the trust are immediately transferred to the person, or persons, of your choice in the event of your death or incapacity.

Upon your death or incapacity, having your business held in trust would allow for the smooth transition of control of your company, without the time and expense associated with probate or guardianship. Using a trust, you can choose the individual(s) you think is best suited to run your company in your absence, whether that absence is permanent (your death) or temporary (your incapacity). What’s more, within the trust, you can also create a succession plan, which would provide the new owner with detailed—and legally binding—instructions for how you want the business run when you are gone. 

Finally, trusts are not open to the public, so your company’s internal affairs would remain private, and the transfer of ownership would take place in your lawyer’s office, not a courtroom.

Although the majority of business owners will get suitable protection for their business using a revocable living trust, for the most airtight form of asset protection, you may want to consider creating a specialized irrevocable trust. Such irrevocable trusts are quite complex, so they are not for everyone, ask your Family Business Lawyer™ to find out if such a trust would be suitable for your particular company.

 

A Comprehensive Plan

While placing your business in a trust is an effective way to protect your company upon your death or incapacity, it’s merely one part of a comprehensive asset protection plan. To get the maximum level of protection for your business, meet with us, as your Family Business Lawyer™.

We can analyze your business and its assets, and discuss all of the different tools available to ensure the company and wealth you’ve worked so hard to build will survive—and thrive—no matter what.

 

This article is a service of Stephanie Hon, Family Business Lawyer™. We offer a complete spectrum of legal services for families and businesses and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. We also offer a LIFT Start-Up Session™ or a LIFT Audit for an ongoing business, which includes a review of all the legal, financial, and tax systems you need for your business. Call us today to schedule. 

Consider This Before You Create A Will Online

A last will and testament is the most commonly thought-of document when it comes to an estate plan. But really it is only a very small part of an integrated plan that ensures your family stays out of court and out of conflict if and when something happens to you.

Do not think you can just write your own will and that will help your family.

You have probably seen ads from services that tout the idea that you can write your own will quickly – maybe even while you are in the security line at the airport (seriously, we have seen those ads in our own Facebook feeds).

Instead, consider the reality that trying to do so could actually create far more trouble for your loved ones down the road if you try to write your own will. Your family and loved ones need you to get professional support from someone who can help you look at what you own, who you love, and what would happen to you and everyone you love if and when something happens to you.

Death is unavoidable – and incapacity may happen before that. These are non-negotiables.

Facing these matters head-on leads you – and your loved ones – to having the best life possible. Otherwise, it is the people you love who get stuck with everything you were not willing to take care of now.

Unfortunately, if you go it alone, you may miss important facets of what happens in the event of your incapacity or death. For example, you may think that a will is sufficient when what you really need is a probate avoidance trust to keep your family out of court. A five-minute will won’t help you stay out of court.

Or you may think your kids are adequately protected because you have a will, but you may really need a full Kids Protection Plan® and without it, your kids could end up in the care of strangers, even if just temporarily. Before you do anything, get educated and empowered to do what is right.

The right plan for you begins with knowing what you have and then being clear on what is necessary to keep your family out of court and conflict and keep your assets out of your state’s unclaimed property fund. If you are ready to write your will, that is great – come see us first.

The biggest mistake you can make is not facing the reality of death, the second biggest mistake is facing it alone.

If you need help getting started, consult with us your Personal Family Lawyer®. We will help you through the process so you can make sure your loved ones are protected and your wishes are honored.

 
This article is a service of Stephanie Hon, 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.  This is why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you have ever been before, and make all the best choices for the people you love. You can 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.

Just Married? 6 Estate Planning Essentials for Newlyweds – Part 2

As we head into the peak of wedding season, if you are a newlywed or are about to tie the knot, add “estate planning” to your do list. And yes, we imagine that at this happiest time of your life, planning for your potential incapacity and eventual death is probably the farthest thing from your mind, but getting it handled as part of your wedding planning is the greatest gift you can give your soon-to-be spouse.

First, be aware of the impact of doing nothing. If you were to become hospitalized for any reason prior to your wedding day, the person you love most in the world would not have the legal authority to make your medical decisions and may not even have the authority to see you in the hospital. Your beloved would have no access to your bank accounts and could even be put into a position of having to move out of your shared home abruptly in the event of your death.

Indeed, once your marriage is official, your relationship becomes entirely different from both a legal and financial perspective. With this in mind, last week in part one, [ INSERT HYPERLINK to Part 1] we discussed the first three of six essential items you need to address in your plan, and here we cover the final three.

4. Durable Financial Power of Attorney

As we touched on last week in part one, estate planning is not just about planning for what happens when you die. It is equally important—if not even more so—to plan for your potential incapacity due to a serious accident or illness.

If you become incapacitated and have not legally named someone to handle your financial and legal interests, your spouse would have to petition the court to be appointed as your guardian or conservator to handle your affairs. Though your spouse would typically be given priority, this is not always the case, and the court could choose someone else.

And the person the court appoints could be a family member you would never want having control over your life, or it could even be a crooked professional guardian, who would charge exorbitant fees, keep you isolated from your family, and sell off your assets for their own benefit. In any case, if you have not chosen someone to make your financial and legal decisions in the event of your incapacity, the court will choose for you.

To ensure your spouse has the ability to make these decisions, you should create power of attorney documents to give him or her this legal authority. You actually need two of these documents, and the first one is a durable financial power of attorney. A durable financial power of attorney would grant your spouse the immediate authority to manage your financial, legal, and business affairs in the event of your incapacity.

With a durable financial power of attorney, your spouse would have a broad range of powers to handle things like paying your bills and taxes, running your business, collecting government benefits, and selling your home, as well as managing your banking and investment accounts. Granting durable financial power of attorney is especially important if you live together before you get married because, without it, the person named by the court could legally force your soon-to-be spouse out with little to no notice, leaving your beloved homeless.

The second document you will need is a medical power of attorney, which we will discuss next.

 

5. Medical Power of Attorney and Living Will

In addition to the durable financial power of attorney, you will also need to create a medical power of attorney. A medical power of attorney is an advance healthcare directive that would give your spouse (or someone else) the immediate legal authority to make decisions about your healthcare and medical treatment should you become incapacitated and unable to make those decisions for yourself.

For example, medical power of attorney would allow your spouse to make decisions about your medical treatment if you are in a serious car accident or hospitalized with a debilitating illness. Without a medical power of attorney in place, your spouse would have to petition the court to become your legal guardian.

As we discussed last week, even though your spouse is generally the court’s first choice for guardian, you should spare your spouse the time, money, and trauma involved with the guardianship process by creating a medical power of attorney and naming him or her as your agent.  

While medical power of attorney allows your spouse to make healthcare decisions on your behalf during your incapacity, a living will is an advance directive that explains how you would want your medical care handled, particularly at the end of life. A medical power of attorney and a living will work closely together, and for this reason, they are sometimes combined into a single document.

Within the terms of your living will, you can spell out things, such as if and when you would want life support removed should you ever require it, whether you would want hydration and nutrition supplied, and even what kind of food you want and who can visit you in the hospital. 

One tragic example of just how nightmarish things can become in the event you are incapacitated without advance directives in place is the case of Florida’s Terry Schiavo, who spent 15 years in a vegetative state after suffering a heart attack at age 26. Because she had neither a medical power of attorney nor a living will Schiavo’s young husband fought her parents in court for years for permission to remove her from life support, and the resulting litigation made news headlines around the world and exposed a deep divide among Americans over the right-to-die movement.

 

6. Name Legal Guardians For Your Minor Children
If either you or your spouse has minor children from a prior relationship, or if you are planning to have kids of your own soon, it is imperative that you select and legally document long-term guardians for your children. Guardians are people legally named to care for your children in the event something should happen to you and your spouse.

And do not assume that just because you have named godparents or have grandparents living nearby that is enough. You must name guardians in a legal document, or you risk creating needless conflict and a long, expensive court process for your loved ones.

When working with us as your Personal Family Lawyer®, naming legal guardians for your kids could not be any easier or more convenient. Indeed, creating the legal documents that will ensure your children will be raised to adulthood by the people you trust most and are never placed in the care of strangers (even temporarily) is one of our specialties. And we accomplish this using our comprehensive system called the Kids Protection Plan®.

The Kids Protection Plan® provides you with all of the legal planning tools needed to make sure there is never a question about who will take care of your kids if you and your spouse are in an accident or suffer some other life-threatening emergency. Even if you have already named guardians for your kids in your will, either on your own or with the help of a lawyer, we often find that these plans contain at least one of six common mistakes that can leave your kids at risk.

This happens because most lawyers are not trained to understand exactly what is necessary for planning and ensuring the well-being and care of minor children. However, all Personal Family Lawyers® have been trained by the author of the best-selling book, Wear Clean Underwear!: A Fast, Fun, Friendly, and Essential Guide to Legal Planning for Busy Parents, on legal planning for the unique needs of families with minor children at home.

Best of all, we have created an easy-to-use (and 100% free) website you can visit right now to take the first steps to create legal documents naming the long-term guardians you would want to care for your children if you could not. Do it here now: https://honlaw.kidsprotectionplan.com

From there, you can schedule a Family Wealth Planning Session™ with us where we will put the full Kids Protection Plan® in place, and determine if there is anything else you might need to ensure the well-being and care of your children no matter what happens. 

Do not wait to take care of this urgent matter. In fact, if you have minor children, your number-one planning priority should be naming legal guardians to care for your children should anything happen to you. And if you need any help with this process, reach out to us, your Personal Family Lawyer®, and we will be glad to walk you through it. 

 

A Trusted Advisor For Your New Family

Getting married is an exciting first step for your new family, and you should start things off right by getting your estate plan properly prepared. But here is the thing about estate planning—it is not just about creating a set of documents and then filing them away in a drawer and never looking at them again until something happens.

Like your family, your planning needs are constantly evolving, so you must ensure your plan is regularly updated as your assets, family situation, and laws change. If you do not keep your plan updated, it will be totally worthless when your family needs it. In fact, failing to regularly update your plan can create problems that leave your family worse off than if you had never created a plan at all. 

As your Personal Family Lawyer®, we have built-in systems and processes to ensure your plan is regularly reviewed and updated, so you do not need to worry about whether you have overlooked it. What’s more, our planning services go far beyond simply creating documents and then never seeing you again. 

Indeed, we will develop a relationship with you and your family. This is so we can get to know you, your wishes, and be there for you throughout the many stages of life—and above all, be there for your loved ones if and when you cannot be. Contact us, your Personal Family Lawyer® today to get things started with a Family Wealth Planning Session™.


This article is a service of Stephanie Hon, Personal Family Lawyer®. We do not 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. You can 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. 
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