How do you feel when you receive a gift you really appreciate? Now how do you feel when you give a gift to someone who really appreciates it? The old adage, “‘tis better to give than to receive,” has been a timeless proverb throughout history for a reason: it’s true. As good as it feels to receive something we appreciate, it feels far better to give something to someone else who can appreciate it even more.

Did you know you can accomplish this by planning your estate? Would you rather give money to your favorite charity or require your beneficiaries to write a large check for your estate taxes (next year, the highest tax rate of any tax in the US) directly to the Department of Treasury?

An effective way to donate to charity as part of your estate plan is via a Charitable Remainder Trust. This is one of the most rewarding ways to make sure that your assets go to the charity of your choice rather than directly to the federal government; thereby, you’ve just allowed Congress to decide what to do with your money. In utilizing this estate planning techniques you can designate assets in trust to donate to charity while still receiving an income from the trust. Once you pass away everything remaining in the trust will go directly to the charity you chose when you first signed your trust.

The tax benefits of donating to charity can be substantial. You can significantly reduce (or in some cases even eliminate) estate, capital gains and income taxes. To find out more about these great tax advantages you should consult an attorney to pick the best option for you and the charitable institution(s) of your choice.

The assets you give to the charity will be removed from your taxable estate. For example, if you give your entire estate to a charity (or the entire amount of your estate over the estate tax exemption, which is unlimited this year but reverts down to $1 million in 2011), your estate will pay no estate taxes!

Additionally, there will be no capital gains tax when the assets are sold by the charity – it’s great for highly appreciated assets. This is another great benefit because if you pass along a rental property to your children worth $500,000 at the time of your death and your beneficiaries sell it for $600,000 they will be paying a capital gains tax [short-term (bought and sold within one year) or long-term (bought and sold over 1 year)] on $100,000, which is the amount of gain from the sale. For simplicity sake, let’s say the long-term capital gains tax applies; they would have to pay $15,000 in taxes as opposed to a charity which would pay nothing in taxes because qualified charities are tax exempt organizations (always a good idea to check with the IRS first to make sure the charitable organization of your choice is recognized as a tax exempt entity). And, if you donate publicly traded securities to a charity, you can get a charitable income tax deduction for their full fair market value - up to 30% of your adjusted gross income.

So you see it pays in many ways to give to charity: you control where the money you donate goes, lower (or even eliminate) potential estate tax liability on your estate, eliminate any potential capital gains tax liability and of course the satisfaction of helping a worthy cause. Ok, so the last one is purely sentimental, but hopefully now you are able see the tremendous benefits charitable contributions can have on your estate, your beneficiaries and the recipient organizations.

Invariably after meeting someone new and getting into a discussion about what I do, I receive this question: “How much does a Will cost?” This is one of the most frequent questions our firm fields and also one of the most challenging to answer. Let’s start with this fact – a Will is NOT a commodity and the process of creating an estate plan should not be the same as picking up a gallon of milk at the supermarket.

So how much does it cost? There are inexpensive Will-drafting software packages for sale in office supply stores (e.g., Office Depot, Staples for about $50), there are relatively inexpensive online Will drafting services (e.g. Suze Orman and Legalzoom kits for about $100) and finally there are many general practice lawyers who will be happy to fill in some form documents and churn out a run-of-the-mill, bare bones, basic estate plan for around $800-$1000. This last group is likely the most dangerous because while you may think that one lawyer is trained the same as another, the reality is that if you broke your arm you wouldn’t go see an ophthalmologist. Even though they’re both doctors, I like you, would rather see the orthopedic specialist than the eye doctor. The same theory applies to your estate plan. You do not want a lawyer who practices mostly in personal injury or criminal law to draft a Will or Trust for you. Yes, we may all be lawyers and legally qualified to practice law, but really how much faith are you going to have in an estate plan written by a lawyer between his appearance at a slip and fall hearing and writing a letter to get someone’s mortgage refinanced. When it’s your family, don’t you want to know that when that cast comes off, the arm will be fixed?

As one of America’s greatest satirist once wrote, “I’ve never met a lawyer who couldn’t write a will.” The fact is that many lawyers will gladly accept your fee and draft a fill-in-the-blanks Will or Trust for you; however, the discount fee you paid ($750, $1000, $1500?) will likely leave you with a worthless stack of papers that you just wasted that $1,000 on. This is why Chhokar Law Group, P.C. is an exclusively estate planning and asset protection firm.

The trouble with all of these fill-in-the-blanks Wills and Trusts is that if you have any special circumstances in your life whatsoever or need any professional guidance, they fail when you need them to work. There are several protections that many families need in place ranging from special needs, divorce/remarriage protections, asset distribution protections (no children should receive a large sum of money via inheritance at 18 because taking that year off to “find themselves” before starting school, just becomes a real possibility). Without a professional estate planning attorney you can be assured that those protections will be absent from your plan. In short, it won’t work!

Another major problem with these options is that there is little to no legal counseling to help you make the best decisions to accomplish your individual goals and objectives. There is nobody there to counsel you when a loved one passes away and you need the estate administered. There is no one to turn to ask the questions about how the assets should change title or what IRS documents you need to have prepared. In fact the attorney who drafted the fill-in-the-blanks Will or Trust will probably charge you for each and every minute of his or her time (billable hours are done in increments of 6 minutes). At Chhokar Law Group, P.C. we never charge an hourly fee for anything, all of your questions are encouraged and welcomed.

An estate plan needs to be a living breathing thing that gets reevaluated periodically and regularly as your life’s circumstances change to ensure that it is still accomplishing what you want, protecting what’s most important to you and doesn’t become a worthless pile of paper. We practice estate planning very differently from most of the other attorneys around here. We enjoy developing meaningful, lifetime relationships with our clients and provide them an exceptional level of personalized service and professional counseling, all in a relaxed and friendly way.

We aren’t the cheapest, nor the most expensive estate planning firm in town. In these economic times there is great temptation to try to save money by shopping around for the best deal. But in the end, you often get what you pay for. We can accept credit card payments, set up payment plans and help make it as affordable as possible. It’s important for us that you know it is far more critical to us that our clients have a plan in place than to leave their families and their estates exposed; the method of payment takes a back seat to protecting our client’s families. We have no desire to be the Walmart of Wills. We have no desire to mass-produce shoddy documents at discounted prices without caring about whether that is really what our clients need. Again you’re planning for life to protect your loved ones and your estate, you’re not shopping for milk.

We will never be the shop you stop in at to pickup a Will on the way home from work. On the other hand, we will be the place you stop to let us know that you’re worried about your daughter’s boyfriend, and you just don’t know, but you’d like to make sure that if you’re not around that she’ll still be protected. We have developed an extensive professional network of financial advisors, bankers and insurance professionals to be able to work as a team to ensure that our clients are taken care of in all facets of their finances.

If this sounds like the sort of legal service you want, please call 858-384-5757 or email us at info@yourtotalesateplan.com.

Your car requires regular servicing in order to maintain its performance and reliability…and so does your estate plan.  Remember all those pamphlets that were sitting in your glove box along with an owners manual you never read, one of them was a recommended schedule for maintenance based on how many miles you drove your car.  At certain times or a specific number of miles, you need to change the oil, replace the brake pads, rotate the tires and so on.  With your car you know if you keep driving it without servicing it, it’s a sure bet your car will let you down (inevitably while it’s raining).  Well, your estate plan is no different.  You may not want to service it  (we all know taking you car in is a pain), but like your car your estate plan is sure to let you down if you do not service it (when your estate plan lets you down, you won’t care if it’s raining).

Your estate plan needs “servicing” or “updating” if it is going to perform the way you want when you need it.  Your estate plan is a snapshot of you, your family, your assets and the tax laws in effect at the time it was created. All of these change over time, thus your plan should change accordingly.  It is unreasonable to expect the simple will and trust written when you were a newlywed to be what you need it to be that you have a growing family, divorced from your former spouse or retired.  In the simplest terms, you cannot draft an estate plan one time to cover your family for all time.  Over the course of your lifetime, your estate plan will need check-ups, maintenance, tweaking and even full revision or replacement (the legal term is “restatement”).  However, if you have the right attorney to do this for you, the servicing will cost you a minimal amount as compared to having to redo a defective plan or far worse having to administer a plan that did not work in the first place.  (Yes that’s right, not only is probate court slow, painful and public, but also it can easily cost you many times over what it would cost to set up a basic living trust plan).

So, how do you know when it’s time to update or service your plan?  The simplest way is to think of it like servicing your car but instead of having more standard mileage checkpoints, your estate plan has event checkpoints.  Generally, any change in your personal, family, financial or health situation will prompt the need for a change.  Additionally any change in the tax laws could prompt a change in your estate plan, which is precisely why you need to be in continuous communication with your attorney!

It’s a good idea to review your estate plan every year.  Set aside a specific time every year (the week after you birthday or anniversary, any month without too many events, two weeks after tax season … you get the idea) to review it.  At Chhokar Law Group, P.C. we do that for you by reviewing your assets every year and restating your trust every two years to make sure no plan is left without “service” resulting in a breakdown of the plan when it’s needed most.

Here are some suggested check-points to alert you when your plan needs “servicing:”

• Marriage, divorce or separation;

• You or your spouse’s health declines;

• Your spouse dies;

• Value of assets changes dramatically;

• Change in business interests;

• You buy real estate;

• Birth or adoption;

• Finances change;

• Parent or relative becomes dependent on you;

• Minor becomes adult;

• Family member dies;

• Federal or state tax laws change;

• You plan to move to a different state;

• Your successor trustee, guardian or administrator moves, becomes ill or resigns; and/or,

• You change your mind – you are the creator of your living trust and can change it

whenever you want.

Remember, as convenient as it would be, you cannot buy a car, never have it serviced and expect it to run like new in ten to fifteen years.  Same with your estate plan, you cannot have it drafted once and then never look at it again expecting it to work exactly how you want when you pass away years down the road.

The vast majority of people don’t even start thinking about planning their estates until they reach retirement age.  If that’s your plan then you’re making at least two mistakes:

1. (1) You are gambling that nothing will go wrong until you’re ready to plan; and
2. (2) You are severely limiting what you can accomplish with your estate planning.

We all know that we will eventually die but understandably it’s an uncomfortable subject for all but the most morbid among us.  The problem is that having the “I know it’s something I should do but I’m still young and I don’t want to think about it right now” or “I know I need it, but I don’t have time right now so I’ll just wait until next year” philosophies will leave you family in a world of pain after you’re gone.  Emotionally for all of the obvious reasons, but also financially and legally because of the probate procedures that anyone without a well executed estate plan has to go through.

Life rarely happens exactly as most people anticipate: people have children without getting married, people get divorced, they marry more than once, then again, they may never marry or have children.  Real life is full of options, choices and twists of fate.  In short, it’s life.

You have to be prepared for the unknown and provide for your loved ones who depend on you in case you’re not around.  Every time we leave our homes and get in our cars, we are at risk of being in a car accident.  Sorry, but that’s the reality.  The point is that nobody is immune from the unknown or unplanned; accidents can happen to anyone and you have to be prepared for those unknown eventualities.  So how do you plan for the unknown?  Well there’s always insurance - every insurance agent on the planet will tell you to buy their insurance to plan for the unknown.

Here’s the rub, insurance, in and of itself is limited.  My auto insurance isn’t going to do a thing for me when the next big earthquake hit’s California causing a Giant Redwood Tree to lose a gargantuan branch.  This branch will then hurtle to earth at astronomical speeds and land perfectly on the little toe on my left foot causing much pain and a trip to the emergency room. After reviewing my auto insurance policy, I will unfortunately confirm that I’m out of luck getting my insurance company to pay for an “act of God” never mind that I wasn’t in my car at the time of the incident.

Remember … life happens and no one can predict it. This is one of the reasons why estate planning is the best and most inexpensive long term insurance coverage that you can ever buy.  We can’t plan for everything specifically, but we can have a solid plan for every eventuality.  For example, if that tree hit my toe and I was in such unbelievable pain that I couldn’t communicate (as would likely be the case because I have a child like tolerance for pain), the person I’ve selected as my Health Care Agent could tell the doctors what to do about my toe!  Excellent, that’s one less worry keeping me up at night.  What would I have done without my little toe?  Which little piggy would have gone “wee, wee, wee all the way home?”  Thank goodness for estate planning.

We take precautions to try and extend our lives for as long as possible. We make sure our cars are in working order.  We eat healthier foods, exercise, and have regular checkups.  And as a result of certain global events we have all become more aware of our surroundings and any threats to our security.  There are no guarantees in life, but we are doing the best we can.

The key issue then becomes: what if that is not enough?  What if you don’t make it to the end of the “normal” road of life?  What would happen to your loved ones if you died today?  Will there be enough money to provide for them the way you would want?  Will they even be able to get to the assets you leave behind or will your assets be tied up in courts, held ransom by the painfully slow probate process that can take up to 12-16 months or more (keeping in mind your assets are tied up in the probate court this entire time)?  How much will they really get (probate in CA can cost up to 5% of the entire value of your estate)?

Wouldn’t it be better to make sure that the people you care about will be taken care of the way you want no matter what happens during your life?  Of course it would.

You could gamble and wait until the last possible minute to plan your estate.  You could be like those people who make estate-planning decisions from their deathbeds in the hospital.  But do you really want to be making some of the most important decisions of your life that will affect your family’s future, potentially for generations, in that kind of condition?  Wouldn’t it be better to put a plan in place now and then have the rest of your life to think about it, polish and fine tune it until it’s exactly what you want?  Remember, estate planning is a process and not an event; you can always make changes to your plan whenever you want.  Frankly having any plan in place is better than having no plan in place.

Planning your estate now doesn’t mean you will die tomorrow, just as buying life insurance doesn’t mean you’re getting ready to die nor does buying homeowner’s insurance mean your house will burn down tomorrow.  So if you act now, you won’t have to worry about what could happen to your family if your life doesn’t follow the normal progression…or about making bad decisions at the last second when you’ve run out of time.

It’s called peace of mind…and you can have it and you certainly deserve it.  So, when’s the best time to plan your estate? Now!

Now that the Obama administration is in place, the uncertainty regarding the future of the federal estate tax may soon be resolved and that resolution almost certainly includes the estate tax being here to stay. If your estate exceeds the $3.5 million lifetime exclusion you need to be proactive and take steps that will minimize the impact of this tax on your estate or else your estate will be paying the government 45 cents for every dollar above $3.5 million. Certain strategies are particularly attractive when asset values have decreased and interest rates are low, as they are today.

One estate planning technique that can be very effective is the grantor retained annuity trust or GRAT. With this approach, you transfer investments, a business interest or other assets to an irrevocable trust. You then receive annuity payments from the trust for a specified period. At the end of that time, the assets remaining in the trust pass to your named trust beneficiaries. When you transfer assets to the GRAT, you are making a gift for tax purposes, however you are not taxed on the present value of the annuity interest since you are keeping those payments for yourself. Additionally you can use your lifetime gift-tax exclusion, currently $1 million, to avoid or reduce tax on the gift of the trust remainder.

Setting up a GRAT when interest rates are low results in a higher value being assigned to the annuity stream. That, in turn, results in a lower taxable gift of the remainder. An additional benefit occurs when asset values increase again because the future appreciation associated with the trust assets will not be subject to gift tax. As long as you survive the annuity term, the value of the assets you’ve transferred will not be included in your estate.

If you’re like me, you’d have to read that paragraph about 6 time to even comprehend what it means.  So let’s simplify: You take an asset, something you bought a long time ago for not a lot of money and today is worth a whole lot more than you got it for and put it into a special trust, the GRAT.   Now the point is that you want your beneficiaries to get it at some point in the future.  Well, we can give it to the GRAT, but the GRAT has to give you an income stream in return, the annuity.  At the end of the annuity term, the asset in the GRAT isn’t considered part of your estate and therefore not subject to the $3.5 million dollar exclusion.  Nice!

The easiest way to reduce your estate is to simply give pieces of it away.  The gifting strategy for reducing the value of your estate is to make gifts that are protected from tax by the gift-tax annual exclusion, currently $13,000 per recipient per year. Since many asset values have temporarily decreased, you should still look at the glass half-full because it enables you to give away more assets to loved ones on a tax-free basis. Another possibility you might consider is loaning your child money. You will have to charge interest at an IRS-prescribed rate, but that rate is currently low. And, to shrink your estate, you can forgive up to $13,000 of the loan each year, which is the extent of the gift-tax annual exclusion.

These are two of many ways to plan your estate in order to minimize the federal estate tax and prevent the federal government from taking 45% of everything you pass along to your loved ones that exceeds the $3.5 million lifetime exclusion.  To help avoid imposing such a significant tax burden on your family contact our office today (858-384-5757 or info@yourtotalestateplan.com) to schedule an appointment so we can discuss strategies that will work for your family.

Living trusts enable you to control the distribution of your estate.  Furthermore, certain trusts may enable you to reduce or avoid many of the taxes and fees that may be imposed upon your death.

In short, a trust is a legal arrangement under which one person, the trustee, controls property given by another person, the trustor, for the benefit of a third person, the beneficiary.  The fun part is that when you establish a revocable living trust, you are allowed to be the trustor, the trustee, and the beneficiary of that trust.  Simply you get to play all the parts in the play.

When you set up a living trust, you transfer ownership of all the assets you’d like to place in the trust from yourself to the trust. Think of it as if you took all your possessions and put them into a box. Legally, you no longer own any of the assets in your trust. Instead, your trust now owns your assets. But, as the trustee, you maintain complete control. You can buy or sell assets as you see fit. You can even give assets away. Effectively, you can have all the same control over your assets as you did before you put them into trust.  So you may ask: “what’s the point of setting up a trust?”  Well keep reading.

Upon your death, assuming that you have transferred all your assets to the revocable trust, there isn’t anything to probate because the assets are held in the trust. Therefore, properly established and funded living trusts completely avoid probate.  So, you get to skip a lot of the fees and costs associated with probate.  Also, by establishing a living trust you also get to avoid the 12 to 16 months that probate requires.  This is a huge benefit.  Effectively, if you use a living trust, your estate will be available to your heirs upon your death, without any of the delays or expensive court proceedings that accompany the probate process.

There are some trust strategies that serve very specific estate needs. One of the most widely used is a living trust with an A-B provision. An A-B trust enables you to pass on up to double the “exemption amount” to your heirs free of estate taxes.  The exemption amount is the amount of money that Uncle Sam allows you to pass on without him taxing it.

When an A-B trust is implemented, two subsequent trusts are created upon the death of the first spouse. The assets will be allocated between the survivor’s trust, or “A” trust, and the decedent’s trust, or “B” trust.  Sometimes these are referred to as the Marital Trust and Family Trust.  Don’t worry about naming protocols.  Let’s just stick with A and B for now.

This will create two taxable entities, each of which will be entitled to use a personal exemption.

The surviving spouse retains full control of his or her trust. He or she can also receive income from the deceased spouse’s trust and can even withdraw principal from it when necessary for health, education or maintenance.

On the death of the second spouse, the assets of both trusts pass directly to the heirs, completely avoiding probate. If each of these trusts contains less than the exemption amount, these assets will pass to the heirs free of federal estate taxes.

Sound like a good deal.  Well for most people it makes a lot of sense to establish a trust. I’ll be covering some of the other benefits of these types of trusts in later posting, including asset protection benefits.  But, if you need more information right now, you can always go to www.yourtotalestateplan.com.

What are you planning to give your teenager when he or she turns 18 and legally becomes an adult? A new watch? A car? A deposit for an apartment? A trip to Europe?

Those are all fine gifts, if you can afford to spend for them. But here’s one you may not have thought of … and it won’t cost you a bundle. Take your son or daughter to your attorney’s office and have them prepare a trio of documents: a simple trust or will, a durable power of attorney, and an advanced healthcare directive. Actually, it’s a gift for both of you, because once your child reaches legal age of adulthood, you will no longer be able to automatically make medical and legal decisions for him or her without the appropriate legal documents authorizing you to do so.

If your son becomes ill or injured and cannot handle his own financial affairs, you will not be able to step in for him and conduct business (sign checks, sell assets, etc.) unless he has a trust or a durable power of attorney and has named you as his successor or agent. If he hasn’t, you’ll have to go through the courts … and that will take time, cost money, and restrict you in ways you cannot imagine. (Some financial institutions also require their own forms; make sure you and your child check with each bank, etc.).

If your daughter cannot make her own medical decisions, it will be much easier for you to make them if she has already named you as her agent. And what if she should be so ill or injured that she is placed on life support before you get to the hospital? Unless she has made her wishes known through a legal document, you may not be able to abide by her wishes and have the life support equipment removed without court approval.

Finally, if your adult child should die without a will, the court will distribute his or her assets according to the laws of the state in which they lived … regardless of what you (or they) would have wanted.

Make sure your new adult understands that all of these documents will need to be changed as their life changes including: accumulating more assets, getting married, buying property, having children, etc.

Helping your child get started with this adult responsibility at the moment when he or she becomes an adult is just one more responsibility we have as parents. It fits right in there with how to balance a checkbook, how to handle a credit card, and how to buy insurance.

Chances are that it will be a long time before any of these documents will be needed. But you’ll be sending your child out of the nest with a full layer of protection … just in case.

Much too often I speak to people and they tell me that estate planning is something for the wealthy.  After much contemplation, introspection and coffee, I came to a conclusion that now seems so obvious that I can’t believe I missed it.  People believe that estate planning is a concern for only the wealthy, because only the wealthy have estates.  Well that’s just plain silly.  An “estate plan” is nothing more than another term for “stuff plan.”  So, if we all started to call it stuff planning we’d all know it was for all of us!  We all have stuff, some good stuff and some bad stuff.  My stuff is important to me because it’s mine.  Your stuff might be better than mine because I don’t have it, but that’s a whole other posting.

In short, estate/stuff planning is simply a set of instructions that you are writing regarding your stuff and what you want to do with your stuff.  Normally, you want your stuff going to your family, sometimes friends and sometimes charities.  But, don’t you want to be the one that decides what happens to your stuff?  That’s an estate plan – your plan for what happens to your stuff.

Now there are a number of requirements that must be met in order to have a valid estate plan.  Your estate plan has to be written down, you must sign it and people have to see you sign it.  That’s the simple part.  Now the plans get more complex depending on how much stuff you have, how long you want to control your stuff (even after you’re gone) and where you want your stuff to go in the end.  Case in point, I love my son, but I think he should wait a few years before he gets my car – or at least until he can walk and is out of diapers.  So in the mean time, I’d need someone to look after my stuff for my son.  See how it gets a bit more complicated.

In order to make your estate plan, you’ll need to put down your wishes into a document called a will or a trust.  To make sure it actually does what you want, you’ll need to have an experienced attorney write up your plan.

Here’s something fun.  The first question you ask the lawyer who’s about to write your will or trust should be “How much of your practice is estate planning?”  If they tell you anything less than 100%, turn around and walk out of their office.  Lots of attorneys claim that they can take care of your estate plan, but if it’s my stuff, I want the guy who works on taking care of stuff all the time.

Finally, if you don’t come up with a plan regarding your stuff, don’t worry.  There’s a plan out there for all your stuff.  It’s the government’s plan and they hope you like it.  Then again, it doesn’t matter if you like it.  This plan will happen if you don’t make one of your own.  The problem with the government’s plan is that someone might be left out of the plan that you would have made and that person now misses out on getting some of your stuff.  Here are some examples:

Example 1: If more than one of your relatives want the same part of your stuff, that can get messy and expensive…and a lot of your stuff will be used to pay the courts and attorneys to sort it all out.  (Fun for the lawyer, but that’s about it).

Example 2: If you’re not married and you want your significant other to get some of your stuff when you die, you’d better get your plan in place, or it just won’t happen.  Under some states’ plans, your stuff will go to your blood relatives.  Period.

Example 3: If you’re married and you’ve got kids, don’t be too sure that your spouse is going to get all your stuff.  Your kids will probably get their share of your assets, which means your spouse may not get enough of your stuff to live on.

In short, if you have stuff and it matters to you, be responsible enough to decide what you want to do with your stuff.

One last thought: if your stuff includes kids, you’ve really got to have a plan in place.  If you don’t do you really think that the government is going to make the same decisions regarding your kids you would have if you were still making the decisions?

Most people have some idea what estate planning is about, but much of what they “know” is actually false. Prior to working with clients, we want them to recognize that the “truth” about estate planning is probably different from their preconceived notions. Take a look at the following information and see if it changes your way of thinking about estate planning. Our “Truth About Estate Planning” presentations go into the details behind these issues so please feel free to check in for these events. (Please sign-up for email updates to receive event specific details)

Estate planning is a Process, not an event. Every estate plan goes through three steps:

(1) Your plan is developed and written;

(2) Time will pass until your plan is needed, during which changes in your assets and the law often cause my plan to fall out of date; and

(3) Administration of your plan at your death or incapacity.

Creating Your Total Estate Plan™ allows you to stay in control throughout the estate planning process. At a minimum you need to have a solid working relationship with a counseling oriented attorney.  This relationship lets you learn what is possible and then develop your plan to do whatever you want. Your attorney’s formal updating program will assure that you keep it current, and that you and your family stay in touch with it. Also remember that getting a settlement fee disclosure and commitments now keeps your family from losing control at your death.

There is no Magic Bullet that will free you from ever working with an attorney again.  Unfortunately many people have the viewpoint of never wanting to work with an attorney. The fact is you need to have a comfortable relationship with an attorney who you know will continue to work with you on an ongoing basis. “Call if you need to update” will fail in the long run as a way of keeping your plan up-to-date. Just leaving your family to “call the attorney” after your death would put the attorney in control of your plan and the costs at that point, so you need an attorney who will fully disclose and limit those costs.  This is one of the reasons why everything we do at Chhokar Law Group, P.C. is done on a flat fee basis explained fully to the client before ever signing anything.

Estate Planning requires teamwork. You can trust and follow the advice you will get from your different professionals if you get them to confer and agree on the advice they are giving you.  Your attorney should have solid professional networks with financial advisors to be able to meet your needs as well as have the ability to coordinate with your personal financial advisors so everyone is on the same page.

Your estate plan won’t work without proper asset titling. Proper asset titling is crucial to the success of your estate plan, whether your plan is designed as a will or a trust. The will or trust is your set of instructions to your family. You need to review all asset titles and make sure the assets will follow your instructions.  This is one of the driving forces behind Your Total Estate Plan™ - we make absolutely sure every one of your assets is titled appropriately and your trust is funded properly.

Estate Planning is about your personal goals more than avoiding probate and taxes. Personal goals can include things like: how you want to live your life; how you want your spouse and children cared for; how your children should be raised even if you die early; what priorities you have for your heirs’ education; protecting your spouse (and your assets for your children) from a new spouse after your death; keeping control of your assets and your care within the family in the event of your incapacity; protecting your estate from nursing home costs; protecting assets from divorces or creditors of the children even after they inherit; and promoting your family’s intangible and spiritual values.

You understand how attorneys charge. Attorney fees for estate planning are always some percentage of the estate, no matter how they are calculated. Our allocation of the fees allows you to explore all planning options by reducing your costs and eliminating hourly fees that often far exceed the initial estimate given to the client at the outset by the attorney.  A good estate planning attorney will make known to the client in advance exactly how much you are going to be charged and exactly what services are provided with that fee.

You can have peace of mind, knowing that your Estate Plan will work!

You can do it through the proactive and systematic process utilized by Chhokar Law Group, P.C. that is specifically designed to develop customized plans for each client in order to satisfy the particular needs of our clients.

For additional information we invite you to check out our website, www.yourtotalestateplan.com. Also, we invite you to set up a consultation with us; bring your family members and your professional advisors.

When you start a new job, you sign a lot of forms.  Tax forms, health care forms and retirement beneficiary designation forms.  Your first few days on the job you take the forms and read them, think about them, sign them and turn them back in to your boss or human resources department.  After that you probably never think about them again.  Big mistake.

One of the most poignant examples of this mistake comes out in a New York Post story back in 2001.  The story “Pension Pickle!” tells a twisted tail of Anne Friedman’s nearly million-dollar pension.  Anne was a lifelong New York City school system employee.  In 1974, Anne named her mother, uncle and sister on her beneficiary form with the Teachers’ Retirement System.  A year later, Ann met and married Bruce Friedman to whom she was happily married for the next two decades.

During her entire marriage, Anne never updated her beneficiary designation.  So after her death, Anne’s sister was the sole surviving beneficiary of Anne’s retirement plan and only her sister had the right to receive Anne’s pension money.  Anne’s sister exercised her right, took nearly a million dollars of Ann’s pension and left Bruce with nothing.  Bruce sued, lost, appealed and lost.

The moral of this tale, don’t be like Anne.  Always update your retirement plan beneficiary designation form, especially after a life-changing event, such as marriage, divorce or the birth of a child.  If you don’t you may end up leaving your loved ones with a broken heart and nothing else.

Unfortunately, not updating your beneficiary designation forms isn’t the only mistake that people make.  Many people assume that if they have a Will, the Will takes care of all the details.  Sorry, it just doesn’t work this way.  Beneficiary designations always trump what’s in a Will.  Even if Anne’s Will stated that all of her pension money is to go to Bruce, Anne’s sister would still end up with the money.  Sorry Bruce.

Alternatively, if you fail to name a beneficiary for an IRA, you are robbing your heirs (excluding your spouse) the right to maintain the same tax advantages that you derived from having the IRA in the first place.  That’s a tax bill that I’d just as soon have my heirs avoid for as long as possible.  For that matter, you’re also going to want to name multiple primary and secondary beneficiaries.  Again, if you don’t pick them yourself, the court will and you won’t have any control over how much goes to who or when it gets to them.

In the end, we all have to come to terms with the reality that each and everyone of us started our estate plans on the very first day of our very first jobs.  We may not think of them as estate plans because the words Will and Trust are nowhere to be seen, but these plans are deciding what happens to our stuff after were gone.  Wouldn’t you call that estate planning?  Just like a formal estate plan put in place by a qualified attorney, these plans need to be looked at and updated over and over.  Remember that estate planning is a lifetime process for the benefit of you during your lifetime and your heirs after you’re gone.

Pay attention to what you’re signing.