Oak Lawn Estate Planning | Elder Law - Planning for Sickness

I know that I have done a Medicaid post previously, but I have received so many calls lately that I thought it would be helpful to add another post with some additional information. If there is more you would like to know about Elder Law, I would encourage you to call and ask your question specifically, or post a comment to the blog if it is of a more general nature. I will start out the advice in this post with the most essential advice I can provide.

PLAN EARLY, DON'T SUFFER, IF YOU WAIT, IT WILL COST YOU

I wish that there was a mountain top I could shout this from. I know that your future poor health is not something that you want to think about, but without proper planning you will pay much more and perhaps receive inferior care. This brings you to the question, what is proper planning? In my humble opinion, proper planning is completing the following tasks long before you are sick.

1. Have a Power of Attorney for Property and a Power of Attorney for Healthcare drafted. These documents will be explained in a future post in more detail, but they are the best first step to take when you are healthy in the event of an emergency.

2. Have a Will drafted that acts as a Pour-Over-Will. A Pour-Over-Will is best described as a back up plan. A Pour-Over-Will does just as the name sounds, it transfers all property into another disposition vehicle. In most cases this is a Trust, which you would have set up in the past. 

3. Have a Trust drafted to hold your assets. There are generally two types of trusts. An Irrevocable Trust is like its own legal entity. This type of trust is to remove assets from your name so that you qualify for governmental benefits. A Revocable Trust is an instrument that will transfer property outside of probate after death. Probate avoidance is critical to speed disposition of property after death, especially is both spouses are ill. 

4. Complete a Medicaid application if you are eligible. I would recommend that you speak to an elder law attorney to help you determine if you are eligible, and if you are not, what steps you can take to become eligible. To find out more on Medicaid, check out my post here on Medicaid Eligibility. 

5. Speak to an Insurance Agent who is knowledgeable in Long Term Care Insurance. I will link to my two previous posts on long term care insurance here. Long Term Care Insurance part 1 and Long Term Care Insurance part 2. I can not stress enough how important it is that you speak to an agent who is very knowledgeable in this unique type of insurance. I would be happy to recommend one if you do not know an agent who handles this type of insurance. The reason you need a specialist in this type of field is because most agents sell very few of these policies and will just read to you the brochure. They have no idea if you are the type of person who can benefit from this policy. They are simply selling what they were told to sell. They have no idea when the product is useful and appropriate. 

6. Draft a Critical Document/ Information List. This is a document that includes all the critical information that loved ones will need in the event of your illness. An attorney with your best interest at heart will provide a comprehensive list of information that you should include in your Critical Document List. Before you decide on an attorney, find out how comprehensive they intend to be. There is more to Illness Planning than just legal documents. 

These six planning tools are important to have completed long in advance of getting sick. My recommendation is to have these tools in place before you turn fifty years old. The likelihood of needing some or all of these tools after fifty is much greater than before fifty. In the case of medicaid planning, you need to have your documents drafted, in some cases, five years before you need care. This is why I stress that proper planning be done well in advance of problems. Better to have things prepared in advance than have their benefit be diminished by waiting until the last minute. 

If you would like to speak to me about these issues, contact me at:

The Law Office of Jonathan W. Cole

5013 W. 95h St.

Oak Lawn, IL 60453

(708) 529-7794

www.jwcolelaw.com

Oak Lawn Estate Planning | How do I know if I need an Attorney for my Will?

I will begin this post with the disclaimer that you probably already know, I am an estate planning lawyer. What does this mean for you, perhaps my opinion iss a little biased, but I also have more experience than you in this area. I warn you to take my opinion as one of many you will look up and you will surely find the answer you are looking for. 

So the question is, when do I need an attorney to do my Will?

 My answer is, almost always. You question should be why. I will give you three options that are non-attorney related and the reasons these option will leave you lacking.

Option One: Get a sample Will online and just change the name to my name.

        Why This Is A Dumb Idea: You Google a Will online and think it may fit your situation. You say, "I don't have a big estate anyway, what could go wrong?" The short answer is everything. Wills have state specific requirements. In order fr Wills to be valid, you must comply exactly with the rules of your state. Do you know how many wittnesses you need in your state. Do you know the requirements for the execution ceremony for your Will? Do you understand how your property will be divided after you pass? You will have to know the difference between per stirpes and per capita with representation. You probably have not even heard of the concept of per stirpes before. I am sure you will Google it now though. An online Will may seem to fit your situation, but in most cases, they do not. There is a good chance that you do not understand what parts of that Will do not apply to you and what parts you may need that are missing. An online Will can only lead to frustration for you and your family. 

Option Two: I will simply hand write my own wishes and leave them where they can be found.

     Why This Is A Dumb Idea: Some states do not recognize a holographic Will. I am sure you will be Googleing holographic Will now. If you do not know if your state recognizes it, you are asking for a world of trouble. Additionally, Holographic Wills are easily challenged in court. This option leaves either two results. One, your will was never valid in the first place and your property will be distributed through your states intestate statute. Option Two, is that your Will is challenged and that means your sanity is challenged  This is a horrible process and usually breaks up families that were tight before the process. 

Option Three: Purchase a Will from a legal zoom type website.

     Why This Is A Dumb Idea: You are hiring an "attorney" to prepare you a Will. Your Will will be a template, based upon a few questions you answer in a pull down menu. What are the chances that an attorney will be able to find out the proper information in a few pull down menu? Not very likely. This is not a customer satisfaction survey from an online retailer. No attorney can create a plan from you with only a few questions. This is a sham of an operation. People can only provide you a proper plan if they can ask you a question and get a response that is not forced to fit one of three options. You are not the same as your neighbor and your plan can not be the same as your neighbors. This is you Will, not an I pod. The ability to have a dialog is vital to getting a plan that is proper for your situation. Additionally, the cost of a live attorney is not substantially more than an online service. I call those who use this service penny wise, pound foolish. 

So this leaves you with the final question, who doesn't need an attorney to draft their Will? Only those individuals who do not care where their property goes when they die. If your opinion is that, I am dead and I don't care what happens to my stuff, intestate is the way for you. If you would like to have some control where your property goes, you should get an attorney to prepare a Will for you.

Law Office of Jonathan W. Cole

5013 W. 95th St.

Oak Lawn, IL 60453

(708) 529-7794

Oak Lawn Estate Planning | Medicaid Planning

You may anticipate that you or a loved one will have to go into a nursing home in the future. You are worried about how you are going to pay for nursing home care. You know it costs between $4,000 and $7,000 a month.  This cost is well beyond the means that most families have saved to cover their medical needs. At $84,000 a year, most families can not keep up with the rising long term care costs. I have already spoken on the benefits of Long Term Care Insurance in an earlier post with a follow up on Long Term Care Insurance in this post. The problem may arise if you are too late to apply for long term care insurance. Long term care insurance is mostly for those who are health now. If you did not get insurance, medicaid planning is the method for you.

Medicaid planning is a very technical type of planning. I will start off the section on Medicaid planning with this warning, you should consult a professional before doing any type of asset transfer. I know you may be skeptical because I am a professional who does Medicaid Planning, but rest assured there is a good reason to go to a professional on this area. If you improperly transfer assets, you could be penalized for up to three times the amount of the asset transfer. This penalty is converted into a period of time and you will be excluded from Medicaid benefits for that many months. The purpose of this post is not to talk about the penalty for an improper asset transfer, but know that the penalty is much greater than it probably should be.

So how does Medicaid planning work? There are assets that are exempt and non-exempt. In order to qualify, you must have a total of non-exempt assets that are below the threshold allowable by Medicaid. This threshold is state specific because each state administrates the federal Medicaid program In Illinois, the Spousal Impoverishment Act allows a community spouse to keep $109,560 in non-exempt assets. It also allows a community spouse to earn a monthly income of $2,739 without having to contribute any of their income to the cared for spouses bills. There are some ways to ensure that your community assets meet this level, but the order of asset transfer must be precise and exact. An "auditor" for Medicaid will look back on any transaction that is made that transfer assets for the five years preceding the application to Medicaid or entry into a nursing home. The key for qualification to medicaid if to transfer assets from non-exempt property to exempt property in a method and manner that will not disqualify you from Medicaid benefits. The problem is if you transfer property in an improper manner, even if the ultimate goal is a proper asset transfer, you will suffer a severe penalty from Medicaid.

The other aspect of Medicaid planning is timely action. If you plan for Medicaid five or more years before you will need it, you will have many more options for transferring your money. You will have a myriad of trusts available to you .These trusts can transfer your assets to anyone you choose. You will not be limited to your spouse or disabled adult children. This is a big advantage for many reasons. You may not have any disabled children and you want to take advantage of tax breaks when giving money to your family. Additionally, you are not limited and under scrutiny with what you do with the money you earned.

If you would like to speak to a professional about Medicaid planning, call me at:

Law Office of Jonathan W. Cole
5013 W. 95th St.
Oak Lawn, IL 60453
(708) 529-7794

Chicago Estate Planning Attorney | What is Probate?

You have heard much about it. Probate. It is such a foreign word. You know the kind. The word you here everyone say, but know one seems to know exactly what it is. Probate. What the heck is Probate? You may have heard people on TV say that you need to avoid probate at all costs. Is probate like a trip to the dentist? What about this word could be so bad that it needs to be avoided at all costs. This post will give you the in's and out's of probate. When you are done, you will be one of the few who is no longer muttering this word like it is the evil bogey man of your nightmares. A "Chubacabra" of sorts.

History: The word probate comes from the Latin word "Probatus" meaning proven. But what is proven? In the case of Estate Planning, and more specifically Wills, the Will is Proven. To Prove a Will.  

Now that leaves the next question, What if their is no Will? If there is no Will, the individual is is considered to die intestate. Intestate means simply without a Will. I will leave the whole intestate discussion to another post, but it is important for you to understand that there are two ways for you to find your estate in probate. 

So back to, - Proving What? We have to prove one of two things. If their is a Will, we must prove the Wills Authenticity, Contents, and the Capacity of the Will Maker (Testator). If their is no Will, you die intestate, we must prove and certify the lineage of the deceased both north and south. North meaning those lineal descendants who came before you. Such as your parents and your grandparents and so on and so forth. The descendants who are south are your children and grandchildren and....on and on and on. This includes lateral descendants such as your brothers children as well. 

How Do We Prove It?  I am so glad you asked. 

 
  The method of Proving the Will is simpler than the the intestate method. In order to prove a Will, a court will be the judge of the validity of the will. A Will will be submitted to probate and an opportunity for for people to contest a Will will be set. This time will also allow creditors an opportunity to submit their claims against the decedents estate.  If their are no challenges to the Will, a simple "certification" by the executor of the estate claiming that the Will is valid and accurate will usually suffice. If their is a Will contest, the drama really starts. I will leave that explanation to another post, but rest assured it is a messy and dirty ordeal.

   If you die intestate, the proof is in showing all potential beneficiaries under your states intestate statute. In Illinois, the method that the State disposes of your assets in a manner called "per stirpes". The method of distribution is not important for the purpose of this post, but what is important is that all potential beneficiaries under the per stirpes plan must be identified and either receive a myriad of letters or sign a certification about the probate. The proof come in when you must show the judge that you did not leave a single individual out of the search to notify all potential beneficiaries of the passing of the deceased.

So where does all of this information leave me?

This post leaves you a little more educated about the probate process and what probate is. The next post will help you determine if you would like to avoid probate, or if probate is right for you. Hopefully, your mind is a little more open to probate after understanding what probate is and what is involved in probate.

If you would like to speak to a lawyer about Probate, a Will, a Trust, or the Administration of an Estate, call the Law Office of Jonathan W. Cole at (708) 529-7794. The Law Office of Jonathan W. Cole has been helping people in Oak Lawn and the Chicago-land area with their legal needs and would like to help you as well.

Law Office of Jonathan W. Cole

5013 W. 95th St.
Oak Lawn, IL 60463
(708) 529-7794

Oak Lawn Estate Planning | What is a Trust?

To explain what a trust is and how it works, consider the following example. This example is a common action of a parents throughout the U.S.

You give money to your baby sitter for things that may be needed for your children. You “trust” that she will use the money for the children’s benefit and not for herself. This, in essence, fulfills the four necessary requirements for a trust.

1. Grantor – The person to creates the Trust …i.e. funds the trust

2. Trustee – Some other Person or entity most agree to hold money or property for the benefit of someone else.

3. Corpus – Also known as the “principal” of the trust.

4. Beneficiary – The person or persons who benefit from the trust

This is an example of a basic trust. We will call it a "Babysitter Trust". In this case, you as the parent are the grantor of the trust. You became the grantor when you handed the money to the babysitter. The babysitter is the trustee of the trust when she is holding the money in accordance with your directions. The money you give to the babysitter is the corpus of the trust. This also could have been property that the babysitter had possession and control over. Finally, your children are the beneficiaries of the trust. The children are the ones who the money is intended to benefit.

This is the basic four necessary parts of a trust. It really makes a lot more sense when it is broken down into its four parts in a simple everyday example. Now that you know what a trust is, look for the next post explaining how to categorize a trust. If you need help setting up a trust, contact the Law Office of Jonathan W. Cole at (708) 529-7794. 

Law Office of Jonathan W. Cole

5013 W. 95th St.
Oak Lawn, IL 60463
(708) 529-7794

Oak Lawn Estate Planning | The Need to Follow Up

The problem with any plan is complacency. With the big three changes always happening, you can not rest on your estate plan forever. The big three being, 1) changes in the laws that effect your estate plan, 2) changes in your assets, and 3) changes in your family structure. In light of this obvious and inevitable change that will occur in the real world, people are stuck believing that their static plan for their assets will be good forever. It is like taking a picture today, only to be curious about why you do not look like this 20 years later.

 The excuses are endless. It costs too much money, it is impossible to know how many changes should prompt me to re-evaluate my plan. I don't have time to update my plan. The list goes on and on. I am always perplexed by the ignorance of people. Good intentions are not enough. You need to take action. If I could yell this any louder, I would lose my voice and my neighbors would be mad at me. You need to take action. If your estate plan provides for your darling two children, who are now both college graduates and getting married themselves, you are long past time. I will give you a rough guide to go by, for determining your re-evaluation period.

No major changes to the big three (see above) - every 7-10 years
A major change to any one of the big three (see above) - every 3-5 years
A major change to any two of the big three (see above) - every 1-3 years
A major change to all of the big three (see above) - see your attorney immediately

If you have a decent relationship with your lawyer, you can probably ask him or her to review your estate plan, and there will be no changes that need to be made or only a minor change. In most cases, this minor change will cost very little and you will now have a current estate plan. In most cases, you would not need to draft a new Will or Trust. All that will be needed is a codicil to your current Will. I can not stress enough how frustrating a stale Estate Plan can be. In some cases, a stale Will or Trust can frustrate the entire purpose that it was meant to support. Please keep you Wills current. As always if you would like to know more about the Will, Trust, and Power of Attorney Process contact:

Law Office of Jonathan W. Cole
5013 W. 95th St.
Oak Lawn, IL 60463
(708) 529-7794

Oak Lawn Estate Planning | More on Long Term Care Insurance

In yesterdays post, I told you how having long term care insurance is one aspect of Estate Planning that is often overlooked. Today I will answe the top five questions I recieve about long term care insurance.

1. What are the odds I will need long term care? The answer is it is probably prettly likely you will need to pay for some long term care. As advances in medical technology increase the average age of the population, the numbers of individuals that that need long term care in increasing by leaps and bounds. A good number of individuals now have major surgery sometime throughout their lives and need to stay at a nursing home or need substantial help to stay at home.

2. Where can long term care services take place? A big falacy is that you must go into a nursing home to get long term care. This is not the facts. You can recieve long term care in a nursing home if you choose, but it is also available in your home or in a community living complex. There is a good deal of flexibility in where your care can take place. It is nice to know that you can be cared for in the comfort and privacy of your own home.

3. Aren't I covered by my medical insurance? As a general rule you are not. Long term care normally is not classified as medical treatment. Insurance companies usually do not cover the type of care that is needed. Hospice might be covered by your medical insurer but general long term care is not.

4. Can't I spend my savings on my care? Of course you can. There is no reason you shouldn't spend all of the money you saved your entire life on caring for yourself. In fact, I would encourage paying your own way and not being a burden on the Government. My suggestion is to purchase the proper insurance to achieve the same results, but still retain your assets. That way you can leave them to your children or favorite chairity. Or if nothing else, you can spend it on your hobby of collecting rare baseball cards.

5. So how does long term care insurance work again? There is a major difference between these two concepts, Medical Care and Activities of Daily Living (ALD). Long term care helps you pay for the ALD's you need when you are sick and recovering. You will need someone to help you get dressed in the morning, make breakfast, clean up after yourself, etc. These are not considered medical treatments but still are necessary to maintin a basic standard of living. Medical care pays for drugs and shots. Long terms care pays for lifes activities, and not just the fun ones.

 I hope this helps you understand the benefits of long term care insurance. Please consider it in your estate planning and call the Law Office of Jonathan W. Cole to get an estate plan in place.

Law Office of Jonathan W. Cole
5013 W. 95th St.
Oak Lawn, IL 60463
(708) 529-7794

Oak Lawn Estate Planning | Long Term Care Insurance

You are probaby asking yourself, "Why is an attorney talking about insurance?" I thought attorneys estate planing was all about Wills, Trusts, Powers of Attorney, and eligibility for State and Federal programs. That may be true for most attorneys, but to have a real comprehensive plan your attorney should consider every aspect of your future. This includes your life insurance, health insurance, IRA and pension, title of your home, finacial future of your children and even your long term care. If your attorney is leaving out a portion of your future, how can you trust him or her to help you plan.

 You future planning is like a boat. You need everything to be right before your boat leaves the dock. Only a fool would have a great hull on a boat but leave without a motor. No one in their right mind would leave the dock without fule for their engine. Who would like to be on the sea with no fresh water? Obviously, no one would think of heading out into the sea with this type of preperation. So why would you accept only partial planning for your future.

Now you know that a comprehensive Estate Plan includes long term care insurance, but what is long term care insurance. The nutshell version of long term care insurance is that it provides funds for you if you become incapacatated and can not take care of yourself. This insurance does not just apply to the elderly. If you were in an accident and needed to be cared for 24 hours a day for a couple years while you are recovering, long term care insurance will cover it. If you develop a disease where you need help injecting yourself and getting dressed. Long term care insurance will cover it. I could go on and on about the benefits of long term care insurance, but I will give you this fact and let you think about it until my next post. The national average annual cost of a private room in a nursing home is over $79,000.00 a year. That is $217 dollars a day. This type of expenditure can quicky depleate the asses of any size estate. Especially if you multiply this cost by two for a married couple.If you would like to have an estate to leave your children, consider long term care insurance as an integral part of your estate plan. Look for more about long term care insurance in upcoming posts.

 If you would like to know more about how to start your own estate plan. Call the Law Office of Jonathan W. Cole to find out how a will trust and power of attorney can get you on the right tract for the future.

Law Office of Jonathan W. Cole
5013 W. 95th St.
Oak Lawn, IL 60463
(708) 529-7794

Chicago Estate Planing | Meeting Your Attorney For The First Time

So after much thought and deliberation, you have decided you need an estate plan. You already know, from my previous post, not to ask "What does a Will Cost?"  The question is, what should you ask and what should you bring into your first meeting? If you have a good attorney, he or she should have already sent you some information. The information may consist of a letter, a questioner, and/ or a financial assessment. I personally send all three to a client before I meet the client for the first time. The letter that I send to a client helps the client know what to expect of the estate planning process. The questioner helps the client get into the frame of mind that is necessary to know who are potential people for testamentary gifts. It also helps the client know what property they have and know about, and what property they have and might have forgotten. It also helps a client understand that the title of property (i.e. the way your deed is titled) is important for estate planning purposes.

 So now you have the proper documentation for your first meeting with your attorney. What else should you have. I have found that the most satisfied clients bring with a small notebook and a pen and ask questions that they have prepared before the meeting and take down my answers. After the meeting with me, they look over their notes and the information I have told them can sink in. By having questions in advance, you can wait until I explain the process to you, and when my explanation is done you can ask any questions that I may have not addressed. Without those preset questions, you may be overwhelmed with other parts of the Estate Planning process and forget to ask some of the questions you wanted to know. Additionally, I usually cover some part of the Estate Planning process that my client never heard of before. By coming prepared with questions and have a notebook to jot down new concepts, you will feel better about your initial consultation and have a more pleasant estate planning process. I would love to hear from you about your estate planning needs in the comments below. If you need an estate plan, contact my office, The Law Office of Jonathan W. Cole, or learn more about Estate Planning on my offices estate planning page. Good luck with your estate plan.

 Jonathan W. Cole

Chicago Estate Plan | What Does a Will Cost?

   What does a will cost? This question is asked over and over again to attorneys. I sometimes think people don't understand that an Estate Plan is not a commodity. When you are looking for gas for your car, gasoline is a commodity. One gallon of gasoline, for the most part, is no different than another gallon of gasoline. An estate plan is as unique as you are. Since an Estate Plan is all about you and your wishes, each Plan must be tailored to the individual. The other thing that I find interesting is that people ask what the price of a Will is, not even knowing if a Will is what they need.

   Let me compare this request to a scenario that would never happen. Pretend you are trying to get fit so that you can run a marathon. You have done no exercise for five years and have put on a few pounds. You then go to the hospital and tell the doctor, I need to lose weight so that I can compete in a marathon. You then ask him how much for liposuction so that your thin self can run faster. Now I know this situation  sounds ridiculous. No one would begin to tell a doctor the treatment needed for a problem they have. You would tell the doctor the symptoms you are having and your medical history. When individuals deal with lawyers though, they ask how much for treatment. They do not even know if the treatment will fix what ails them.
  
   As a general rule, a Will alone will not solve the clients Estate Planning needs. I will plug my website, which is a great resource in regards to what Estate Planning Tools are available to help distribute your assets and care for your children. I request you not ask a lawyer how much a Will costs and instead ask what tools need to utilized to plan for the future. If a lawyer answers your question, how much is a Will, it is probably time to move on to another lawyer. The lawyer who will give you a blanket price will not take you into account when planning your future. Without knowing about you, your family, your assets and your plans for distribution, a lawyer has no idea what you need and could never quote you a price for the proper estate plan that will carry out your wishes. It is best to allow your lawyer to collect information about you, design a plan for you and then inform you as to the price of that plan. You an your attorney can then dissect that plan to fit your budget and desires. If you would like to speak to an attorney in the Chicagoland area about an Estate Plan, that will include a Will, go to my website by clicking The Law Office of Jonathan W. Cole. As always, feel free to ask questions and post your comments. I love to answer reader questions and get suggestions about future posts.

 JWC

Welcome to the Blog

I would like to welcome you to the first post of Chicago Estate Planning. This blog will focus on providing unique insight into the world of estate planning, how to choose an estate planning attorney, what to bring to your initial consultation, and other estate planning tidbits. If you would like to know more about me personally, please follow me here to see what I am up to personally and learn more about me. If you are here, you are probably interested in planning your estate and this blog will start you on your way to doing that. It will probably seem like a daunting task to get your estate plan in order. I assure you that this process will be made simpler by following the steps that I list here and reading some of my sage advice on this process. I look forward to leading you down an important path in your life and congratulate you on your first step in the process.