What to do with a Confusing, Old Trust

Estate plans evolve. Or at least they should. Any plan that fails to achieve your goals and doesn’t match your current financial and family circumstances is out of date and is in need of an overhaul.  I'm here to help you and your network revitalize the obsolete aspects of your plan and get you on track for the future.

How to know if you have an outdated trust

If you or anyone you know signed a will or trust in 2012 or before, an immediate review should be on your to-do list. There have been many legal and policy changes since 2012, and your documents may not work as well as they could.

If you signed your will or trust after 2013 and it’s been more than a year since we talked, now is the time to make sure your plan still meets your needs and avoids confusion along with needless complexity, costs, and taxes.

You may also be the beneficiary of a deceased loved one’s will or trust. These older trusts left by a parent or grandparent can often benefit from a “remodel” or modernization.

Quality estate planning is an ongoing process

Like investment or financial planning, tax planning, health and fitness, and so many other aspects of life, proper estate planning is an ongoing process that you must revisit regularly. I make it my business to keep up with the latest developments in legislation and know how to make changes to your plans to avoid risks and seize opportunities. But, I need your help and your engagement in the process to help you avoid the negative consequences of outdated or obsolete planning.  If you're a member of our Client Maintenance and Education Program (CMEP), you can do all this -- for free.

You are not trapped by old plans, even when they’re “irrevocable.”

Now that you are aware of an outdated trust posing a potential risk to your family’s long-term well-being, we can work with you to restate or amend your revocable trust or will. This is a straightforward solution that can update and modernize your trusts and make them ready for the current realities of the legal and financial landscape we live in today.

Many of you probably have an irrevocable trust of some kind as well, an inheritance from a parent or grandparent or even one you made yourself. There are more boundaries and modernization is a more involved process for an irrevocable trust, but I have an array of tools (decanting, trust protector restatement, judicial modification, or non-judicial settlement) at my disposal to “remodel” or modernize an existing irrevocable trust. Trust decanting is an increasingly valuable option and borrows its name from the decanting process used for wine. Just as you can decant wine by pouring it from its original bottle into a new bottle, leaving the unwanted sediment in the original bottle, you can pour the assets from one trust into a new trust, leaving the unwanted terms in the original trust.

There are many strategies and legal tools that can be used to modernize old estate plans. Since each plan is unique, the way to update it will be as well. Coming up with the most effective strategy requires careful consideration of your current goals and needs, as well as your tolerance for risk.

Even though there is no way to know for sure what to do until some analysis is complete, it’s better to have an informed choice rather than acting upon the assumption that your plan will work as intended, especially if it hasn’t been professionally reviewed. These are complex legal processes, and there is no one-size-fits-all answer.

At Private Wealth Counsel we want you to have the best possible plan for your family. Always feel free to give us a call to explore the options.

Private Wealth Counsel

10 Duncan Street

Suite 703

Haverhill MA 01830

(978) 241-4871

Long Term Care Planning: It Pays Off.

Why Factoring Long-Term Care Into Your Estate Plan Pays Off

For most people, thinking about estate planning means focusing on what will happen to their money after they pass away. But that misses one pretty significant consideration: the need to plan for long-term care.

The last thing any of us want to contend with when a health issue arises later in life is having to throw together a hasty estate planning solution in the face of mounting medical costs. Your best defense is careful planning with the help of a trusted expert.

Why it’s so important to plan for long-term care

While only about 19 percent of current U.S. residents will need to reside under long-term care for a period of over three years, that number sharply increases when factoring in nursing home stays of a shorter duration — which will still have a substantial impact on your estate.  For couples who reach the age of 65, there is a 70% chance that one of them will need Long Term Care Services.  

Whether the care you need takes place in a nursing home, assisted living facility, or with an in-home provider, the costs can mount with alarming speed. For example, national average rates for assisted living hover around $3,500 per month. As those costs add up, you could see your assets dwindle much sooner than you’d hoped. Luckily, estate planning attorneys can help in a number of ways.

What to go over with your estate attorney

If long-term care isn’t factored into your estate plan, you are probably not looking at a truly realistic and accurate representation of your assets. Talk to your estate planning attorney about the following factors in order to get on the right track:

1.    Set reasonable expectations for long-term care

It’s impossible to know what life will bring, but we can certainly make educated guesses. For example, are there any major diseases that run in your family? There is a chance you will have the good fortune of staying healthy well into your golden years, but estate planning is an aspect of your financial life in which it’s helpful to protect yourself against worst-case scenarios.

In the estimated likelihood that you will require such care, at what age could you reasonably predict you’ll need it? Do you have any current health conditions to take into account? Exploring these possibilities may not be the most enjoyable exercise, but it’s far better than facing the reality of long-term care with no plans in place.

2.    Consider a long-term care insurance policy

As Medicare or standard health insurance may not cover your costs, a long-term care insurance policy is one way to protect yourself against draining your financial assets. Ask for resources for finding an affordable premium that isn’t likely to increase prohibitively over time. Begin this process as soon as possible, as your premium will be lower the younger you are when you apply.

Another potential oversight is assuming your long-term care will be covered by Medicaid. Discuss it as an option to determine your qualifications and get authoritative insights about the specificities of your unique financial situation in terms of Medicaid benefits.

3.    Get smart about living wills and trusts

In order to best prepare your loved ones for complex medical decisions, go over advance directives. In addition, discuss options for setting a revocable living trust, and possibly one or more irrevocable trusts, like a life insurance trust or a charitable remainder trust, as part of your long-term care planning.

It’s also important to create a plan that allows someone you trust to access and utilize your financial resources for your benefit in the event of unforeseen medical circumstances. One common mistake is tying up assets in investments that aren’t liquidatable when you might need them most. For example, money locked into annuities can result in a fee for early withdrawal. Working with a team of that includes an estate planning attorney, financial advisor, and insurance professional can provide you and your family with the best overall solution.

Take the time now to talk to an estate planning attorney about the best ways to maintain financial security in tandem with the demands of long-term care. Even if you don’t end up needing long-term care in your lifetime you can enjoy the peace of mind knowing you’ll be covered.

The process of completing a long-term care plan may sound daunting, but we’re here to help you by making it a streamlined experience — simply get in touch with us today and let us put you in a more secure position for the future.

Hillary Clinton Proposing $2mm cut to Estate Tax Exemption

By now, it seems as though Hillary Clinton will win the 2016 election. 

If she does, she has stated that she intends to lower the estate tax exemption from $5.45 million, to about $3.5 million.  

What will this mean for you and your family?  

If you expect (or hope) to earn more than $3.5 million during your lifetime (including any inheritance you expect to receive), please contact our office immediately, as we are poised to take advantage of techniques that will allow your family to be "grandfathered in," and thus, avoid the new law.  


Mark E. Skandier, Esq.
President - Private Wealth Counsel, LLC
(978) 241-4871

10 Types of Trusts

A Quick Look at 10 Types of Trusts:

Considering the myriad of trusts available, creating an estate plan that works can seem daunting.  But, that’s what I do, every day.  As a former teacher, I can teach you the laws, and I will design a plan which addresses your specific situation.

Here’s a look at the basics of ten common trusts to provide a general understanding. There will not be a quiz at the end. 

1.      Bypass Trusts. Commonly referred to as Credit Shelter Trust, Family Trust, or B Trust, Bypass Trusts do just that: bypass the surviving spouse’s estate to take advantage of tax exclusions and provide asset protection. 

2.      Charitable Lead Trusts. CLTs are split interest trusts which provide a stream of income to a charity of your choice for a period of years or a lifetime. Whatever’s left goes to you or your loved ones.

3.      Charitable Remainder Trusts. CRTs are split interest trusts which provide a stream of income to you for a period of years or a lifetime and the remainder goes to the charity of your choice. 

4.      Special Needs Trusts. SNTs allow you to benefit someone with special needs without disqualifying them for governmental benefits. Federal laws allow special needs beneficiaries to obtain benefits from a carefully crafted trust without defeating eligibility for government benefits.

5.      Generation-Skipping Trusts.  GST Trusts allow you to distribute your assets to your grandchildren, or even to later generations, without paying the generation-skipping tax.

6.      Grantor Retained Annuity Trusts. GRATs are irrevocable trusts which are used to make large financial gifts to family members while limiting estate and gift taxes.

7.      Irrevocable Life Insurance Trusts. ILITs are designed to exclude life insurance proceeds from the deceased’s estate for tax purposes. However, proceeds are still available to provide liquidity to pay taxes, equalize inheritances, fund buy-sell agreements, or provide an inheritance.

8.      Marital Trusts. Marital Trusts are designed to provide asset protection and financial benefits to a surviving spouse. Trust assets are included in his or her estate for tax purposes.

9.      Qualified Terminable Interest Property Trusts.  QTIPs initially provide income to a surviving spouse and, upon his or her death, the remaining assets are distributed to other named beneficiaries. These are commonly used in second marriage situations and to maximize estate and generation-skipping tax exemptions and tax planning flexibility.

10.  Testamentary Trusts. Testamentary Trusts are created in a will. These trusts are created upon an individual's death and are commonly used to provide for a beneficiary. They are commonly used when a beneficiary is too young, has medical or drug issues, or may be a spendthrift. Trusts also provide asset protection from lawsuits brought against the beneficiary.

There are many types of trusts in existence today. Private Wealth Counsel can help select which trusts, if any, are a good fit for your clients. 

Estate Planning - 3 Reasons We Run the Other Way

Estate Planning:

3        Reasons We Run the Other Way

It feels hard to get around to estate planning.  It sounds about as fun as getting a root canal. The problem – is that we all want to make sure our loved ones are protected so that there’s no confusion or infighting upon a mental incapacity, disability, or death.  We also want our loved ones to inherit our hard-earned assets – regardless of whether we have 10 million or 10,000 dollars.

Don’t let these common roadblocks stop you from protecting yourself and your family:

1.      Who Wants to Talk About Death?  Discussions of death, dying, and illness - money and family - will and trusts - make many folks uncomfortable. Of course, that’s normal.  But, don’t let a few minutes of feeling uncomfortable stop you from taking care of yourself and your loved ones.

2.      This Isn’t a Good Time. Everyone is busy. There’s never going to be a good time. Call the office, get on the calendar, and get it done.

3.      I Don’t Get It.  Estate planning is a holistic process.  It’s not just “writing a will”.  Big decisions must be made; finances must be discussed; the law must be analyzed and a roadmap will be created through legal documents.  It’s common feel uncomfortable in a world you’re not familiar with.  If that’s what you are thinking, you are not alone. I will translate complex legal concepts into everyday terms for you, just like I did as a teacher, before attending law school. 

The truth is that estate planning isn’t that scary. In fact, with a little help, estate planning is easy. As a former teacher, I’ll chat with you about your goals and concerns, analyze your family and financial situation with you, and work with you to create a solid plan.

You provide the information, which we always keep confidential, and we’ll take care of everything else. You’ll walk out of our office with peace of mind, knowing that you’ve protected your spouse and your family.