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Griffin Georgia Law Blog

Do you need a lawyer for retirement planning?

After a long career you are finally ready to settle down and retire. Retirement will be relaxing but there are still some elements you will need to take care of first. Retiring means you will need to make some more decisions in order to plan for your future and this could require an attorney to help.

But, do you really need to hire a lawyer just to retire? If you want to save time and money, the answer is yes.

Estate planning essentials for parents in Georgia

Estate planning is a critical part of planning for the future. Wills, trusts and powers of attorney can help people obtain peace of mind for themselves as well as their beneficiaries. These estate planning tools can also have significant practical and financial benefits by lowering taxes, probate costs and associated delays. In particular, trusts can create structures that pass on significant sums of money while providing far greater control to the creator than simply relying on a will.

However, beyond the traditional estate planning tools, parents may be particularly interested in creating documents that make clear exactly what should happen to young children under certain circumstances. Specifically, in a case when the parents pass away suddenly or unexpectedly. Within the text of a will, parents can name the preferred guardian for their child, a process that can be verified in court.

Down payment amounts can be negotiated

Georgia residents may believe that they need to put 20 percent down to buy a house. However, there are loan options available that allow a person to buy a home with a lower down payment. According to a U.S. Mortgage Insurers study, the median down payment in 2017 was only 10 percent. The Realtors Confidence Index Survey from November 2017 found that 61 percent of first-time buyers made a down payment of 6 percent or less.

In some cases, it may be possible to obtain assistance that will help reduce a down payment or help with other closing costs. Sellers' concessions may also make it easier to qualify for a home loan with less money needed upfront. Those who do choose to pay less than 20 percent down will have to account for private mortgage insurance. It provides financial protection to lenders in the event a borrower defaults.

Tips for selecting surrogates to act as agents of an estate plan

Every estate plan in Georgia has unique aspects, but most benefactors need to select trusted agents to fill roles like trustees, power of attorney agent or executor. When choosing people or professional organizations to occupy these positions, people typically need to weigh family dynamics and the skills and willingness of the individuals they choose for these roles.

A trustee or executor needs to be qualified for the position or have the capacity to learn the duties. For example, a trusted family member might not represent the best choice if that person has trouble organizing personal affairs. Some people might live too far away to administer someone's trust, or they have too many personal responsibilities to take on the workload.

Choosing who to leave a legacy to in an estate plan

A Georgia entrepreneur who runs a business or has other complex investments might want to eventually pass on these assets to their children. However, a family member may not be the best choice to take over a company or manage other complicated assets. Another option is to have employees and other professionals take over those assets while still ensuring that family members receive the financial rewards.

It is possible that a child will not appreciate a legacy or may lack the expertise to properly run a business. This was the case for one man who had built up a company his father started into a business that he eventually sold for $50 million. The man did not want to leave it to his family because they already had some difficult dynamics, and he was afraid the added stress of managing the company would fracture them. Unfortunately, selling the business meant his legacy would not be carried on. He could have created a succession plan that would allow the business to pass to the control of others while still benefiting his family.

These debunked Medicaid myths will help you help your parent

Despite best efforts, few people are prepared when the time comes to send their parent to a nursing home. While some senior’s health gradually declines and your moment of decision is less clear, other seniors have a sudden incident, such as a fall or an illness, that makes the decision to move to a nursing home clear.

Regardless of circumstance, the moment of decision can appear out of nowhere and it’s important to prepare. To do so, there are several confusing Medicaid myths to debunk. Before explaining those, let’s define Medicaid.

How to know if trusts are right for an individual

While trusts can be helpful for those in Georgia who are looking to take advantage of the new estate tax rules, this isn't always the case. As a general rule, trusts should not be setup for grandchildren as there could be other ways to help them. Financial advisers may first want to determine if a person would want to access funds or other assets given away to children or grandchildren.

If the answer to that question is yes, it may not make sense to make large gifts. The type of assets a person has may determine whether a grantor or non-grantor trust best fits his or her needs. For instance, trusts looking to take advantage of the new pass-through business entity rules would have to be the non-grantor variety. However, those who have life insurance policies are generally better off with grantor trusts.

Why it's necessary to plan for long-term care needs today

According to Key Private Bank, less than 25 percent of clients with a high net worth have long-term care plans in place. For the purposes of the study, a Georgia resident would qualify as high net worth if he or she had more than $1 million in assets. One of the challenges of planning for long-term care needs is that individuals may also be trying to save for a house or other long-term expenses.

Another challenge is that some people assume ignoring the issue will make it go away. However, a good plan will align a person's long-term care goals with their overall lifestyle goals. For example, it may be possible to ensure that an individual is able to stay in his or her home while receiving treatment. It may also be possible to develop a plan that would allow a person to stay with friends or family members.

Some trust are better than others when interest rates are high

As interest rates fluctuate, individuals should revisit their trust-planning strategies. Certain types of trusts tend to provide better value than others in high interest rate environments. Georgia residents may consider updating their estate plans to include a charitable lead annuity trust (CLAT) or grantor retained annuity trust (GRAT).

Generally speaking, a CLAT combines a trust and an annuity, with the annuity payment going to charity. The trust part of the CLAT is created for a predetermined time, at the end of which it expires. Typically, a primary goal of a CLAT is to allow the maximum value for charitable donations. If there are trust earnings over and above the annuity payment, that value passes to the beneficiaries of the trust. Once the trust's term is complete, any remaining value passes to the beneficiaries as well.

Important elements of an estate plan

While many Georgia residents have a will, more estate planning documents may be necessary to address complex issues. The first step in creating or expanding an estate plan should be to make a list of assets and debts. The asset side of this list should include even small items. In many cases, heirs can argue over relatively minor inheritances.

To reduce the likelihood of fights over the estate plan, one could write a letter of intent. This could explain to family members why certain items have gone to certain people. It is also important to choose the right people to manage various aspects of the estate. For example, a spouse might not be the best choice as the executor if they are prone to extreme emotions. If there is a trust, one or more trustees must be named. In addition, parents may need to name guardians who can take care of minor children. Special instructions may be left for the trustees and guardians.

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