Danbury Legal Blog
Helping your heirs avoid discord regarding your estate
Even if your children have always gotten along fairly well, there are several issues that may arise in your wake that can impede their sibling relationships. No Connecticut parent wants to imagine his or her children fighting over an estate; however, the reality is that, even close-knit relatives sometimes wind up not speaking for months or years over matters that initially seemed rather benign.
There are several things you can do while you're still with your family, and while you're still of sound mind, to help them avoid disputes when the appointed party or parties administers your estate. Estate plans are highly personal documents; in fact, you can execute a customized plan to fit your own needs and goals. Some estate plans are simple while others are highly complex. In either case, problems can arise, but if you seek guidance before signing off on your plan, you may be able to prevent a lot of trouble.
Estate planning tools guard against the uncertainties of life
Financial experts say that even young Connecticut residents who enjoy robust good health should put at least a basic estate plan into place. Life is unpredictable, and unforeseen events like automobile accidents or serious illnesses can claim lives or leave individuals incapacitated and unable to manage their financial affairs or make important health care decisions. Those who wish to prepare for such unfortunate situations may be wise to draft a last will and testament, a durable power of attorney and a medical directive.
A last will and testament can prevent bitter disputes among heirs by establishing unambiguously how individuals wish their assets to be distributed after they pass away. When no will has been drafted and individuals die intestate, assets are distributed according to state law. In addition to a list of disbursements and other instructions, wills also name an executor who is responsible for administering disbursements and guiding the estate through the probate process.
Why venture capital firms won't work with certain startups
There are several reasons why a startup in Connecticut or elsewhere won't get funding from a venture capital firm. For instance, there may have been problems with the pitch deck that scared a potential investor away. Issues could be related to how the deck was designed or the fact that there were egregious spelling or grammar issues. A venture capital firm may also have an issue with the company's valuation.
If the valuation is too high, an investor may be getting too little equity for too high a price. Furthermore, it means that the company will need to raise money later at a higher valuation, and there is no guarantee that this will happen. However, if the valuation is too low, it could send a signal that a company isn't confident in itself. Therefore, it is best to create a reasonable valuation backed up by quality research prior to making a pitch.
Legendary singer Aretha Franklin died without a will
Many Connecticut fans of legendary soul performer Aretha Franklin may be surprised to learn that she died without a will, despite her valuable music catalog and substantial estate. The 76-year-old singer passed away in August after a lengthy struggle with pancreatic cancer. Despite comments from her attorney that he had encouraged her to set up a trust and other key estate planning documents, she refrained from doing so throughout her life. She was unmarried and has four adult children, one with special needs, and the process of passing on her estate could be much more complex as a result.
When a substantial estate is at stake, the risks of family feuds and other disputes can be obvious, especially when a large estate tax burden may apply. However, even people with modest estates can provide a significant benefit to their loved ones by making a will and drawing up an estate plan. Without creating trusts or other transfer documents, Franklin's estate will be publicly valued and passed through the probate court. As a result, her heirs may have to wait much longer for their disbursements. They may also have to pay additional costs and fees.
Estate planning concerns for parents
Parents in Connecticut may think about estate planning in a new light after the birth of their children. While many younger couples know objectively about the importance of an estate plan to lower taxes, avoid probate costs and reduce trauma to their loved ones, making a plan may not seem urgent. When a child enters the equation, however, planning for the future can become increasingly essential.
Estate planning includes the creation of a number of key documents like wills, powers of attorney or advance health care directives. While some shy away from making a plan due to the costs or complications involved, visiting a lawyer for an estate plan can be accessible to families and individuals of all means. When creating a will, parents can not only lay out how their property will be divided but also name a guardian for their child in case both parents pass away. In addition, parents can create trusts in order to ensure that the funds they pass on to their minor children will be used responsibly to provide for their care.
Cryptocurrency and other digital assets in estate planning
Connecticut is one of more than 40 states to have laws on the books that permit executors to manage digital assets in the same way they do traditional assets. The rise of digital assets in recent years, including cryptocurrency, has introduced some additional complexities to estate planning.
It is important for people to think about both the technical and legal side of estate planning when it comes to digital assets. Without taking care of the technical side, relatives might have the legal right to access the assets but be unable to do so in a practical sense. The opposite would be true if the legal side were neglected.
Picking the right surrogates for an estate plan
Estate plans in Connecticut can be extremely lengthy and complicated, and it's not uncommon for some plans to have unforeseen calamities just waiting to happen. One of the main sources of problems is surrogates, aka the people assigned to make big decisions for the families. These surrogates can have a big impact on family relationships and overall financial security. Unfortunately, they don't always make choices that are in the best interests of the family.
Surrogates can take many forms, including agents, trustees, executors, agents for funeral decisions, social security representative payees and financial account designees. When two or more of these surrogates are assigned the same responsibility, conflict can arise if there is a lack of communication or serious disagreement among parties. Duties tend to overlap when an estate plan is amended over a long period of time. To solve this problem, plans should be carefully evaluated for conflicts from time to time.
Are your neighbors overstepping their bounds?
This is the season for home improvement. You may be noticing people in your neighborhood replacing their roofs, painting their porches or refreshing their landscaping. You may have some projects on your own calendar.
Perhaps your closest neighbors mentioned their plans to build a shed or put up a fence between your properties. However, you were not prepared when you saw the new construction crossing over to your side of the property line. If your neighbor is encroaching on your land, it is important to act quickly. Failing to reclaim your property may result in the courts assuming you have forfeited the land.
Long-term care planning options
Connecticut residents should be thinking about future long-term care needs and how to pay for them today. Roughly 70 percent of those who are age 65 or older will need long-term care at some point. While a person has the option of paying for the associated costs of such care on his or her own, that may not be practical. The median cost for a private room in a nursing home is $97,455 per year.
That number could be even higher depending on where a person lives. For many, a long-term care insurance policy may cost too much to be relied on to cover all the expenses incurred while sick or injured. Ideally, a policy will be used to cover gaps after accounting for income from Social Security and other sources in retirement. While Medicaid may cover medical costs, people will have to exhaust their assets first, which can have negative consequences of its own.
Dealing with a family business in estate planning
Entrepreneurs in Connecticut and around the country generally want their spouses or children to inherit their businesses after they pass away, but turning over successful commercial ventures to individuals who may lack the skills necessary to run them can sometimes have disastrous results. Business owners with spouses or children who have shown little or no interest in following in their footsteps may be wise to delegate control of their commercial ventures to key employees or professionals. Doing this improves the chances of the business surviving and ensures that heirs are rewarded financially.
The individuals entrusted by entrepreneurs to run their businesses are not always qualified to distribute the profits to their heirs, so it may be prudent to appoint individuals with estate planning experience to fill these roles. Business owners should be especially concerned about key employees who may resent family members with no active day-to-day role in the company reaping the benefits of the employees' efforts.
