Q. Do I need an estate plan if I don’t have a lot of money?
A. Absolutely! Every person should have some sort of plan in place to guide your family in the event something should happen to you. Some estate plans require only a Last Will and Testament and others may require in depth trust planning.
Q. How do I find out what type of estate plan I need, and how much will an estate plan cost?
A. A meeting with an experienced estate planning attorney is essential in determining what your estate plan should look like. The cost will depend on your personal situation. Call to get an idea of what the costs might be.
Q. What if I don’t think I can afford an estate plan?
A. The most expensive plan is always not having an estate plan. Your family will incur more costs in setting up and settling your estate, even if you only have one bank account and one car, if you don’t have a Last Will and Testament.
Q. I am divorced and never changed my Will, can my “ex-wife” or “ex-husband” still get all of my assets?
A. Not necessarily. Any assets that pass through your will via the probate court will go to your alternate beneficiaries, such as your children or other family members. However, if you have listed your ex-spouse as a beneficiary on a pension, 401K or other retirement plans for example, he or she might still benefit from those assets. You need to get those beneficiary designations changed right away.
Q. My wife and I both have children from a previous marriage. What type of estate plan do we need to protect everyone?
A. Great question, and the answer is you probably need a trust which will detail the distributions to your children, your wife’s children, and to each other in a carefully drafted plan. This will ensure protection to the two of you, and to your children, and will also prevent disinheriting any of your loved ones.
Q. Can a trust be challenged the same as a Last Will and Testament?
A. Yes, but it is far more difficult and costly to the person waging the challenge. Typically, a last will and testament is a three to four page document. A trust is usually fifteen to twenty pages. That fact alone indicates the trustmaker has put some time and thought into the document.
Real Estate Questions
Q. Is it necessary to have an attorney at my house closing?
A. Not necessary but highly recommended. It seems like that would be an obvious answer coming from an attorney, but keep in mind that once you retain an attorney to represent you, that attorney is obligated to look out for your interests only. No one else in the room has that obligation. When you are involved in a transaction of several thousands of dollars, you want to make sure there are no problems at the closing table. More importantly, if there are any problems, you want to make sure there is someone there to protect you.
Q. What is a Land Contract and is it a good way to buy real property?
A. A Land Contract is best described as a “rent-to-own” form of buying real property. You essentially agree to pay a monthly sum, but rather than your payments simply being applied towards rent, they are applied to a purchase price. There typically is an initial down payment and a lump sum payment at the end. Once you have paid in a certain amount, you have an equitable interest in the property. However, land contracts are riddled with problems and are not the preferred way to buy real estate.
For example, if there is still a mortgage on the property, and the land contract seller does not continue to make payments on the loan, the buyer can be foreclosed out of the property, thus having paid into a deal in which they come away with nothing. On the other hand, if the land contract purchaser stops making payments to the seller, the seller may have to evict or even foreclose the purchaser’s interest out of the real property. It can be very messy. If you are considering a land contract, always, always have an attorney involved.
Medicare and Medicaid Questions
Q. Will Medicare pay for my stay in a nursing home?
A. Medicare and other supplemental health insurances will pay for your stay in a nursing home so long as your condition is improving and the goal is for you to return home. However, once it is determined that you cannot return home, and that you will be remaining in long term care, Medicare and very likely your insurance will stop covering your stay.
Q. Is that when Medicaid kicks in? And will the government take my house?
A. Medicaid is coverage when you have used your own money for your care. If you have a spouse who is going to remain in your home, your house, car, and a portion of your other assets will not be required to be sold in order to provide for your care. However, if you are single, you will be required to use all of your assets, including the proceeds from the sale of your home, to pay for your care. When your money has essentially run out, then Medicaid will cover you. Be sure to consult with an attorney experienced in Medicaid applications in order to make sure that you maximize all options under the rules.