Wednesday, September 30, 2009 Who's Taking Care of Rover When You're Gone?Your pet may have been with you for years. In fact, pet ownership can likely lead to a higher life expectancy. A report by The British Journal of Health Psychology found that pet ownership resulted in lower blood pressure, lower cholesterol, and better overall health. In fact, pets may be especially helpful when you are in the greatest need. A study in Public Health Reports found the heart attack survival rate among pet owners was 28% higher than among those without pets. Many people suspect these health benefits of pet ownership result from the companionship the pet provides. In many cases, pets are considered a member of the family.
We plan for our human family members with a Will, a Living Trust, and other vehicles to ensure they are taken care of. However, we often forget about our furry and feathered family members or assume that one of our surviving family members will take on their care. However, if we do not make arrangements for our pets, they may join the hundreds of thousands of sad pets who end up in shelters or are euthanized because their owner is no longer able to take care of and provide for them. For example, according to the ASPCA, 2-3% of pets entering shelters each year do so because of the death or disability of their owner. That is between 120,000 to 240,000 loving cats and dogs who end up in shelters, or worse, because of their owner’s death or disability. None of us like to consider our own mortality. When doing your planning, don’t forget the pet members of your family. These loving, vulnerable members of your family need you to plan for them, too.
While you cannot prevent your own death or disability, you can prevent your loving pet from ending up in a shelter or being euthanized at your death. You can arrange with your friends or family for someone to be your pet’s caretaker upon your death or disability. The estate plan you create for your family should include a “Pet Trust,” a trust which ensures that your loving pet is cared for even after you are gone. An estate planning attorney can designate the primary caretaker in your Trust. You should also name an alternate caretaker, in case your primary caretaker is unable or unwilling to fill that role when the time comes. Additionally, the ideal caretaker for your pet may not have the financial resources to meet your pet’s needs, particularly if your pet has specialized dietary and health concerns. You can leave a list of your pet’s foods, medicines, veterinarian, and other useful information for your pet’s caretaker. Your Trust can set aside some money to provide for your pet’s food and medical needs for the remainder of your pet’s years. Your Trustee will administer that money and is under a duty to use the money that you set aside for your pet’s needs. If you choose, you can even pay your pet’s caretaker a monthly stipend or a set sum for taking on this responsibility. If you have no friends or family to act as caregiver for your pet, consider designating a charitable organization such as Best Friends (www.bestfriends.org), Bideawee (www.bideawee.org), or a similar pet adoption / rescue agency to take your pet, along with a donation, to the charity as part of your estate plan. A qualified estate planning attorney, one who focuses his or her practice in estate planning, will know how to craft a Pet Trust to provide for your loving pet.
Your pet has provided you with love and affection. Now, you can do something to ensure that someone is there to love and care for your pet, even if you are no longer able to do so. Do the loving thing, call your estate planning attorney today to arrange for a Pet Trust. Thursday, September 03, 2009 Michael Jackson's Death - Why YOU Need Your Estate Planning Documents in Order The sudden dealth of Michael Jackson serves as a reminder to everyone that, no matter our age, you need to have your estate planning in order. The pop superstar died on Thursday, June 25th at 50 years old. The media is speculating as to how his estate will be handled and the future of his young children. No public statement has been made in regard to his personal planning and the media and the nation will wait anxiously to see how this unfolds. If Michael Jackson prepared a Trust the public will most likely never know the details as it will be held private, however,if he had a Will it becomes part of public record. In the state of California, a Will needs to be presented within 30 days. Jackson's assets, royalties and the amount of debt he had accumulated most likely will lead to lengthly battles over his estate.
Steve Hartnett, Associate Director of Education for the American Academy of Estate Planning Attorneys, was quoted in the Associated Press' article Jackson May be "Worth More Dead Than Alive" explaining some of the options that Michael Jackson had to protect his family. "Jackson might have shielded some of his estate from creditors and ensured that his children were taken care of by placing a life insurance policy and other assets in an irrevocable trust."
Wednesday, August 19, 2009 Tough Times Could Get Tougher
Dark clouds are all around us. The stock market is down. Real estate values are down. Layoffs are up. But, it could be even worse!
With tough economic times, people often look to hold others accountable for their difficulties. Which is why lawsuits tend to rise as the enonomy sinks. In fact, surveys of corporate law departments shows increased expectations for litigation. So, what can you do to protect yourself?
First, consider placing your business or rental property in a limited liability entity. Let's say you own a corner market. If you own it directly, then someone who is injured on the premises could collect against all your assets, including assets not involved in the business. This could include things like your home and the money you've set aside for your children's education. Let's say your business has assets of $500,000, you have a home worth $500,000, and you have brokerage accounts worth $500,000. The entire $1.5 million could be in jeopardy.
However,if your business were owned by a corporation or a Limited Liability Company (LLC), for example, the injured person could only collect against the $500,000 of assets in the entity, regardless of the amount of the damages awarded to the injured party. Your home and brokerage accounts would be safe.
Second, consider liability insurance. If someone sues you, that is your first line of defense. There is seperate liability coverage for your home and your auto. In addition, you may need a seperate policy for a rental property or any business-related liability, like malpractice insurance for a doctor. In addition to these seperate liability policies, consider an "umbrella" policy" which provides coverage on top of the underlying coverage. If you had a premises liability for your corner market, that policy would protect you up to the policy limit, let's say $300,000. This would pay first. Then your umbrella coverage would add its limit, let's say $1 million, on top of that. So, you would be protected for the first $1.3 million of court awards against you. However, that would still leave some exposure to liability above the $1.3 million, if you did not have a limited liability entity.
Third, leave assets to your children in a manner which protects them. A trust can protect your children and the assets you leave them from your children's creditors, their future ex-spouses, taxes, and even their own misjudgement. A qualified estate planning attorney can help structure a plan that limits liability for you and your family. |