Estate Law Articles
17 Smart Ways to Protect Your Assets
Smart Way #1: Make a promise to yourself – now. Make a personal commitment to yourself and your family that you will do everything possible to protect your family and your assets.
Smart Way #2: Identify your personal and financial goals. If you could have anything you want, personally and financially, what would it be? What are your dreams? How do you and your spouse want to spend your retirement years?
Smart Way #3: Discover which tools you can use to achieve those goals. You have many legal tools at your disposal that, when used correctly, will create exactly the plan you want for yourself and your family. Ask your estate planning lawyer to explain the tools that will achieve your personal and financial goals.
Smart Way #4: Minimize the Need for Probate and the Court system, as appropriate. Create a family estate plan that, upon your death, distributes your assets to your heirs without going through the Court-supervised process called probate. Considering maximizing the use of Beneficiary Designations, Joint Ownership, Multiple Wills, an Alter Ego Trust or a Joint Partner Trust.
Smart Way #5: Reduce income taxes whenever possible. Create a family asset protection plan that eliminates unnecessary income and capital gains taxes and minimizes all other taxes. Without proper planning, much of your estate can be lost to various types of taxes.
Smart Way #6: Protect yourself with insurance. Lawsuits can quickly tie up your assets. And if the other party wins the lawsuit, the judgment against you could quickly deplete your funds. If you drive frequently, own rental property, or operate a business, buy an umbrella liability policy that protects your assets from lawsuits. If you have obligations to dependents, particularly if you are in a blended family, ensure you have appropriate insurance in place.
Smart Way #7: Provide for future health care and financial decisions. Your family estate plan should protect you and your spouse if the time comes when either of you cannot make decisions. Your estate planning lawyer can make sure you have the legal documents in place so a competent, trusted person can make these important decisions according to your wishes.
Smart Way #8: Plan now to arrange nursing home care. Sadly, many people wait until it’s too late. They do not address how they will pay for care or where they would like to live when the need might arise. Plan now, with your Attorneys for Property and Personal Care. Don’t wait until it’s too late. Do it now, long before you need it. You’ll save emotional stress and financial challenges.
Smart Way #9: Pay close attention to Alzheimer’s disease and its associated costs – even if you have no reason to worry about it. Many people who never expect Alzheimer’s disease to strike have had to face its problems with no advance planning. So, plan for Alzheimer’s disease now while you have time. This includes the need to address issues of backup decision makers, assisted living, and nursing home care. If your children can care for you later in life, that’s fine. If they cannot, your advance planning will pay big dividends. Plan for the worst – and hope for the best. Then, in either case, you will have all your bases covered.
Smart Way #10: Keep all control within your family. If you don’t plan properly, you could find that a friend or relative has applied to the Court to intervene on your behalf. Once a Judge gets involved, you have ongoing legal and accounting expenses, plus more problems and hassles than you would ever want to endure. The smart way to plan for your later years in most cases is to keep total control within your family via the use of carefully considered and planned Powers of Attorney for Property and Personal Care.
Smart Way #11: Create your plan now, while everyone involved is competent to make decisions. Seniors often come to our office seeking help only to learn that they are too late to correct a terrible situation. We feel awful when we must tell them that the much-needed planning should have been done two, five or ten years earlier. Even in borderline situations, it is challenging to advise someone and have them understand and accept that a medical opinion of their capacity needs to be obtained. Don’t wait until you need help to create your plan. By then, it’s too late.
Smart Way #12: Review your plan at least every three years. Every time your circumstances change or your goals change, you should change your estate plan. If your plan is not up to date, the unintended consequences to you and your family could be disastrous. Make an appointment at least every three years to meet with your estate planning lawyer. Then you can go over your plan and discuss any changes in your life circumstances and plans.
Smart Way #13: Make proper decisions concerning your Canada Pension Plan and Old Age Security Benefits. Make sure your plan maximizes these benefits and minimizes income and estate taxes.
Smart Way #14: Think about future housing options. Start from the perspective of where you would like to live. Then determine if you could afford this option by comparing your monthly income along with your life savings to the initial cost and the ongoing financial commitment you would have to make. Make sure you consider (1) your healthcare needs that will not be covered by insurance, (2) financial security for your surviving spouse, and (3) your desire to pass on a legacy to your children.
Smart Way #15: Keep the lines of communication open within your family. If one of your children will be managing your finances, you should take specific steps to help him or her avoid conflict within your family. Insist that your child disclose to other family members what has been done on your behalf or include provisions in your Power of Attorney that address the obligations of the child – your Attorney for Property – that is managing your finances. You can do this by adding this instruction to your Power of Attorney for Property. By doing this you accomplish two things: One, you keep everyone in the loop so feelings of distrust are eliminated. And two, you reduce the risks of financial abuse because other family members will know how your finances are being managed. And, don’t appoint all your children to manage your finances or health matters because you don’t want to disappoint them – when they don’t agree on decisions, you’ll be creating a costly emotional and financial mess.
Smart Way #16: Don’t let incapacity put your family at risk for criminal or social worker investigations. Many professionals are responsible for protecting frail and elderly people from predators. If your legal documents don’t provide clear legal authority and guidance on how to manage your assets, the police or representatives of the Public Guardian & Trustee’s office could step in and question your children’s actions and motives. If authorities investigate your children’s actions, at worst, they could file criminal charges. At best, an investigation by the PGT could return a “finding” of no current financial abuse. You can eliminate these risks to your children – and avoid becoming a burden to your children – with a competent estate plan and Powers of Attorney that make clear their obligations and instruct them to obtain legal advice as soon as they start acting for you.
Smart Way #17: Hire a competent, experienced estate planning lawyer to create an estate plan. The areas of estate planning and elder law are far too complex to hire just any lawyer. Often, strategies used in estate planning to minimize taxes directly conflict with strategies used in elder law planning to protect assets. In situations where both goals are important, you and your family need a lawyer who has in-depth knowledge and experience with both sets of rules and strategies. Most lawyers are not qualified to provide these services. Make sure the estate planning lawyer you hire has the knowledge, skill, judgment, and experience to create a competent plan for you and your family. Preferably you should look for the TEP designation – Trust & Estate Practitioner – signifying that the lawyer is a member of STEP, a global professional association for practitioners who specialize in family inheritance and succession planning.