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Estate Planning FAQ

What do I need to start the estate planning process? 

 

The base of any good estate plan is a good asset listing, as this will determine the trajectory of your estate plan. 

 

Different assets pass differently at your death. 

 

For example, retirement accounts, annuities and life insurance pass pursuant to a beneficiary designation form on file with the financial institution. 

 

Are there any beneficiaries listed on any of your financial assets? These beneficiary designations may supersede your Last Will and Testament.

 

Are your assets owned jointly by two or more individuals? This contractual type of ownership will impact how your assets pass at your death and may impact how your assets are taxed after your death.

 

Prior to meeting with any client, you will be asked to provide a detailed list of your current assets (as well as how they are titled [ie: are they owned by husband, wife or jointly?]) This includes all real property, savings accounts, checking accounts, CDs, savings bonds, brokerage accounts, individually held securities, business interests, 401(k) plans, retirement accounts, life insurance, annuities...) It may be helpful for you to have a copy of your most recent account statements for the legal titling of your assets to be reviewed.

 

How long does it take to complete the estate planning process?

 

Basic estate planning can be completed with a couple of weeks. Whereas more complex estate plans involving trusts typically take at least a month to complete.

 

What are the costs?

 

As each estate plan is individualized according to the clients’ needs, there is no one size fits all when it comes to the costs of estate planning. The fees will be based upon the amount of time required to complete the project. Please email me at karenshvarts@gmail.com to set up a free 15 minute phone consultation to discuss your specific estate planning needs. A good estimate of the fees can be provided during this telephone conversation. Basic estate planning typically starts at around $2,000, with more complex trust planning starting at $4,000 and up.​

 

My situation is very simple, I need basic estate planning documents….but, do you?

 

I receive this exact phone call every week. The reality is very few of my clients need basic estate planning documents. Let’s explore this a little more.

 

What are the basic estate planning documents?

 

Last Will and Testament – This document will designate the person you would like to administer your estate. It may designate a funeral agent to take care of your funeral arrangements.  It will also provide for the disposition of the assets in your individual name and appoint the guardians  In this critical document, you are able to control the disposition of your assets at your passing.

 

Health Care Proxy/Living Will – This document will name a person to make medical decisions for you in the event that you are unable to make these important decisions for yourself.  It will address your intentions with respect to life-sustaining treatment and end of life decision making. 

 

General Durable Power of Attorney – This document will designate one or more individuals to make financial decisions on your behalf.  Should you become incapacitated, this document is vital in order to allow for the management of your financial affairs, including the filing of annual income tax returns, payment of bills, management of financial assets, to name a few. This document will also allow you to designate whether and to what extent you would like your Attorney-in-Fact to have control over your Digital Assets.

 

What is a trust and do I really need one?

 

There are many different types of trusts. But a general explanation is:  A trust is a way for a person to control assets for the benefit of one or more individuals during a specified period of time, based upon the terms and conditions dictated by that individual. The person also gets to control what happens to the trust funds after that specified period of time.

 

I was told I should set up a Revocable Living Trust to avoid probate….maybe and maybe not!

 

Yes, a Revocable Living Trust will avoid probate, but in New Jersey we have a very simple probate system. In New York, however, probate tends to be very lengthy. Avoiding probate is state specific.

 

I have minor children — should I set up a trust?

 

Minor children under the age of 18 years cannot inherit assets outright. This is one of main reasons, I set up trusts for my clients. Parents should use their estate planning to protect their children and setup the parameters for their inheritance of assets as children or even as young adults.

 

My children are over the age of 18 years and are responsible young adults — should I set up a trust?

 

Young adults may not be equipped to manage an influx of six or seven figures as a result of the distribution of your home, life insurance and savings. Although they can now legally inherit your assets outright, setting up a trust in your estate planning will ensure they have the proper guidance to launch into financially responsible adults.

 

My children are married with children — should I set up a trust?

 

Your children are now financially stable adults, happily married with children of their own. They can clearly financially manage the inheritance you leave to them. But, do you want to make sure the inheritance you leave to your children will ultimately benefit your grandchildren?

Estate Administration FAQ

My loved one has passed away, where do I start?

 

Just as with estate planning, the starting point of administering an estate is the inventorying of the loved one’s assets.  In addition, you will need to inventory the deceased’s liabilities. I tell my clients to pretend they have a camera and are taking a snapshot of the loved one’s assets and liabilities (similar to a balance sheet). What did they own when they passed away and what did they owe when they passed away?

 

When a proper estate planning has been established, contact Karen to provide the guidance needed to put that estate plan into action. With nearly 30 years of experience, Karen provides a compassionate ear at a difficult time. Karen will provide step by step guidance to simplify this process, detailing in plain English a step by step guide for the distribution of each asset and how to deal with each liability.

 

How long does it take to administer an estate?

 

Some estate plans are relatively simple to work through and can be handled with simple guidance from a seasoned professional. Other estate plans are more complex and may require estate or inheritance tax filings. The length of the administration of the estate is dependent upon the complexity of the estate and can range from one month to a couple of years.

 

What are the costs involved in administering an estate?

 

In contrast to the costs of estate planning which can easily be fairly accurately estimated, the costs associated with estate administration is not as straight forward. Due to the nature of this engagement, all fees are based upon based upon an hourly rate and billed semi-monthly.  Detailed invoices are issued regarding time spent, as legal services in administering an estate are based more upon counseling services, as opposed to the legal drafting of documents. 

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