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Lakewood, Colorado Elder Law And Estate Planning Law Blog

Choosing legal guardians for minor children

One of the most important steps parents in Colorado and around the country take when developing an estate plan is choosing a guardian to care for their minor children. When parents pass away before their children reach the age of 18, guardians are called upon to take on the caretaker role and make important financial decisions. Parents who do not select a guardian for their children leave the issue up to the courts to decide, and they can never be sure that the judge making the decision will have the same values and priorities as they do.

There are actually two types of legal guardians that have very different duties, which is why attorneys with experience in this area may suggest appointing different people to fill the roles of guardian of the estate and guardian of the person. Guardians of the estate manage the child's inheritance and are expected to submit detailed records to the court. This is a fiduciary relationship, which means that guardians of the estate are legally bound to make their decisions based on what is in the child's best interests.

Questions single parents should consider when estate planning

For most Colorado parents, the needs of their children will factor strongly into how their estate plans are structured. A single parent may need to consider who would take care of a son or daughter if he or she were to pass on. This is especially important when there is no other parent with whom a child can live with or otherwise receive care. In addition to deciding who will care for a child, it is important to think about how assets will be passed down.

In many cases, it is best to pass assets to a child through a trust. A trust gives the parent the power to determine how and when assets are used. Furthermore, a parent can also name a person to manage those assets in accordance with the document's instructions. For surviving family members, written instructions give them a better idea of how to meet an individual's wishes after his or her passing.

It's a big mistake to not name an IRA beneficiary

Many Colorado residents worry about properly saving or investing the money in their Individual Retirement Accounts. However, the biggest mistake an account holder can make is failing to name the right beneficiary. It may seem like a small detail, the sort of thing that a person can just take care of later, but overlooking it can cost the person's family a lot in terms of aggravation and cash.

IRA owners will often fail to update beneficiaries or leave the beneficiary designation blank altogether. When the designation is blank, the IRA gets transferred to the person's estate immediately when they die. In some cases, a large tax liability may be created out of nowhere.

When blended families plan for the future

People in Colorado with blended families may have unique concerns when it comes to planning for the future. Different types of blended families may relate to each other differently, especially when the couple married later in life when their children were already grown. Even close families may want to have a conversation about their estate plans, as both parents may want to make provisions for their biological children as well as for their stepchildren. This means that simply passing everything to a person's spouse after death may not be a good solution for these families in particular.

Problems with estate plans in blended families may reflect a poor relationship, but at other times they simply indicate people who grew apart over time or who were never close, since the children's parent remarried after they were already grown and out of the house. Advance planning can help to avoid difficulties. In some cases, spouses may simply bequeath part of their estate directly to their children as part of their will rather than leaving all of their belongings to each other.

It's never too early for an estate plan

Bringing a new baby home may have your head spinning. You may already have a nursery in place and well stocked, but it is not too late to think ahead for changes you must make. For example, although your child may not be crawling yet, it is a good idea to baby-proof the house to ensure the child's safety. You may be reading books about how to provide appropriate sensory stimulation for the child, and you may even be looking around for a quality daycare or preschool.

Planning ahead is important when you have children. However, there is one area of planning that many new parents overlook, and that is estate planning. You may be like many in Colorado who think of estate planning as something to do when you are nearing retirement, but having a child in your life is a powerful reason to begin the estate planning process.

Collectibles and estate planning

Personal property can introduce challenges to the process of estate planning. Such property could include valuable collectibles like antiques, art, coins, jewelry and more. One of the issues with personal property as part of an estate is that it can easily be forgotten, lost or taken by family members or others. Colorado residents with valuable collectibles may want to investigate options for tracking. There is software available for this.

Sharing inventory lists with family members, attorneys and other advisors can also help reduce the likelihood that these kinds of assets will go missing. Serial numbers and photographs are among the ways that items can be documented. Collectors may want to use safety deposit boxes, alarms or other methods to secure items. Insurance could provide added protection.

Creating trusts to help special needs children

Colorado parents who have children with special needs may want to consider certain estate planning tools. For many families, a trust is the right vehicle to provide for kids with special needs.

Wealthy families who know their children will not need to receive government benefits can simply create a trust that has enough funds. For example, a trustee can be placed in charge of a discretionary trust. The income and principal can be used to support the child.

Why long-term care is important for Colorado residents

Now that the baby boomer generation is reaching retirement age, long-term care is becoming a reality for more and more people. Some estimates say that as many as 70 percent of boomers will need long-term care at some point during their lives. Nursing care can run as much as $7,000 to $8,000 per month, and Medicare does not cover such costs.

Since planning for long-term care can be emotionally draining, however, many people simply choose to avoid it. Experts say that these procrastinators could be placing themselves and their families in financial jeopardy. This is because health care costs continue to rise, and that trend is expected to continue in the future.

Advantages of revocable trusts

Comprehensive estate plans in Colorado might include a will, powers of attorney, medical directive documents or other planning instruments. In many cases, having a revocable trust can lend benefits both to the person who makes it, called the grantor, and to his or her heirs. When the grantor of a trust dies, the trust can be written to live on indefinitely, carrying out the instructions of the grantor. Where the grantor is also the trustee, the trust should be written to provide a new trustee on the grantor's death.

The assets held in a revocable trust pass outside of probate on the death of the grantor. This is an advantage that can save significant time and money for heirs. It also allows the transfer of trust assets to remain private as property that is probated is made part of the public record. Many families who don't want the transfers made public use revocable trusts.

Understanding probate basics may help you get started

After your loved one's passing, you may have already known that you would take on the role of executor of the estate. If so, having this information in advance may have allowed you to gain some information on the duties you would have during the probate process. Still, you may not fully understand what probate will entail.

As the executor, you will have several responsibilities to address in order to ensure the correct settlement of your loved one's final affairs. Any mistake could prove costly during these proceedings, and you may find yourself having to contend with conflict nonetheless.

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Kaeble Law LLC

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Lakewood, CO 80401

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