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Archives for September 2018

An Introduction to Estate Planning

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Many individuals believe that estate planning, or “leaving a legacy” is only for the rich. Without a doubt, estate planning is important for those who are wealthy. Yet, it has been our experience that the more modest your estate, the greater your need to arrange it for careful handling and disposition according to your wishes. It just makes sense to want to make your estate stretch further, to help those closest to you, and to better accomplish your charitable goals.

Why you need an estate plan

Deciding in advance on how to dispose of your estate at the end of your life is known simply as estate planning. If you have possessions or assets, you have an estate worthy of a plan, and the foundation for leaving a legacy. Possessions and assets you own also offer you an opportunity to give beyond your lifetime.

There are many benefits of developing an estate plan. Many of which could be personal. Other benefits you may not learn about until you explore this topic with an estate planning attorney. Creating an estate plan:

  1. Helps simplify or avoid probate
    Probate is the legal process that validates a person’s will, settles debts and distributes remaining assets to those left behind. If there is no will, or the wrong kind of will, this process can get expensive and lengthy.
  1. Protects assets from “creditors or predators”
    Appropriately chosen and written estate planning strategies can shield assets from lenders, unscrupulous family members, plaintiffs in personal injury suits, and others.
  1. Ensures your care if you become ill
    Pulling together medical powers of attorney, HIPPA authorizations and advance directives can empower your family (and doctors) to provide the care you want if you become incapacitated due to illness.
  1. Can reduce tax liability
    Depending on the size of your estate, a significant chunk of your assets could be at risk of going to the federal government without careful planning. The good news is, Texas does not have a state inheritance tax.
  1. Provides for children
    If your children are minors and depend financially on you, a strong estate plan can take care of their needs when you are gone. Options include choosing a guardian for your minor children, appointing a trustee to oversee their finances until they are adults and determining when and how any money or property you left them is distributed.
  1. Provides for others
    Your estate plan can also provide for adult children, low-income relatives and your favorite charities, while also ensuring these individuals or entities do not misuse or squander the assets, or lose them to creditors.
  1. Helps minimize family conflict
    Sound estate planning can go a long way toward reducing friction among family and friends.

Here is a list of items that should be included in your estate plan.

  1. A revocable or living trust
    This is a trust you can change at any time during your life. It details assets that will pass to your heirs after your death and instructions for the distribution of these assets. A trust allows your assets to be passed on without going through probate, which can be an expensive and lengthy process.
  • A will 
    If you have a revocable trust, your will typically provides instructions for  the distribution of any property not referenced in the trust. Without a revocable trust, your will may provide additional instructions.
  1. Medical power of attorney
    If you become incapacitated and unable to make medical decisions for yourself, this document assigns someone else to make medical decisions for you
  1. Financial power of attorney
    If you become incapacitated and unable to make financial decisions for yourself, this document assigns someone else to make financial decisions for you.
  1. Irrevocable trusts
    These trusts for life insurance policies or other assets can help you avoid certain taxes and protect those assets from creditors, if done correctly. Once completed, however, they can be difficult to revise.
  1. HIPPA authorization
    If you become ill, a Health Insurance Portability and Accountability Act (HIPPA) authorization allows people you designate to more easily access your medical information — such as critical details about your care and prescriptions.

When and how to revise and amend your estate plans or wills

Once you have an estate plan in place, think of it as dynamic, requiring you to review and evaluate its content and directives on a regular basis. Generally, you should expect to update your estate plan anytime you experience a major life change. Life happens and is full of unpredictable events. Relationships also evolve, end and begin. Unexpected financial gains or losses may prompt you reevaluate your original goals or plan. You may experience shifts in your own internal value system, and decide to take a different direction with your charitable donations, or other directives.

Here is a list of events that could trigger you to reappraise your original estate planning goals and its details along the way.

  1. A death in the family
  2. A birth in the family
  3. Divorce
  4. A significant change in your assets or debt
  5. Changes to state or federal laws that might allow you to take advantage of new options to achieve your goals, or restrict your options

Other changes such as these may also prompt you to rethink or amend your estate plan.

  1. Market shifts, new unanticipated debts and changes to your portfolio
  2. Changes in your health or the health of loved ones of key businesses associates
  3. A trustee, guardian or executor gets sick, or is unable to fulfill duties
  4. New planning tools, technologies or strategies to manage your assets

Now what?

This article is a good place to start if you are considering estate planning, or even simply writing a will. But it is only a first step. Consider this an introduction on how to maximize your assets, ensure good healthcare for yourself in your later years, and provide for the next generation in your family. Since each estate is as unique as the individual creating an estate plan, you owe it to yourself to discuss your situation with an estate planning attorney with the skills and experience to handle your process effectively and efficiently.

Estate planning is important. If done well, it will ensure your wishes, protect your family and provide a legacy that expresses your values. In addition, the process and the plan also offer you peace of mind and a feeling that you can now be free to live out the rest of your years exploring, traveling, and following your passions, knowing you are free to live out your dreams.

You likely still have lots of questions and concerns about estate planning, call our office today and schedule a consultation on developing a plan that fits your and your family’s needs today and in the future.

Disclaimer — This article provides a general introduction and overview of the topic of estate planning and  is not intended as a substitute for consultation with an attorney. For more information or specific legal advice on developing an estate plan or will, please contact the office of Trey Yates Law at 713-932-7177.

Shifts we are seeing in post-separation parenting plans

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Family law attorneys, family court judges and therapists, along with academia, scholars and researchers are all currently grappling with a shift taking place in the area of creating shared parenting plans for divorcing spouses. Since about 2000, for a number of reasons and/or justifications, there has been an increase in child possession plans that emphasize continuous and frequent contact with both parents — or joint physical custody (JPC).

Current data generally supports that shared parenting families are on the rise and that children are benefitting from this new family form. However, some JPC plans or schedules seek to satisfy a true 50/50 possession time for each parent; and this is often proving to be unrealistic and problematic for parents and children alike. In the past, any child possession schedule which gave the non-primary parent 35 percent of the time or more was considered shared possession. Now, a growing, popular consensus of opinion in the field is that children, including infants and adolescents, are best served when they maintain strong and secure attachments with both parents. At the same time, however, academics, scholars and researchers continue to argue about the risk and benefits of a strict 50/50 JPC. This debate, which has shown up in the media and on the Internet, has gained credibility to the point where it is influencing state legislatures and policymakers.

Here are examples of how a true 50/50 JPC possession order might be expressed in an actual schedule:

  1. A child/children spend on week with one parent in his or her residence and the following week with the other in his or her residence;
  2. A 2-2-3 (or 2-2-5) plan designates every Monday and Tuesday to one parent and every Wednesday and Thursday to the other, with alternate weekends rotating from one parent to the other;
  3. A “nesting” plan is where a child/children remain in the same home, while the parents take turns staying one week on and one week off in the home, yet maintain separate, alternate residences.

Multiple forces are fueling the push toward JPC 50/50 schedules. Most researchers agree that a child can be attached to more than one caretaker, moving away from the conviction that very young children should spend more time with their mothers. Groups advocating father’s rights are also proponents of this shift as society progresses toward a more egalitarian and scientifically supported view that both parents should be involved in parenting as much as is reasonably possible.

In Texas, the Standard Possession Order (SPO) is the prevailing rule, thus the “norm.” So, if a client pushes for JPC, or a 50/50 schedule, attorneys must present enough evidence to show a judge why he or she should approve a departure from this standard. This requires a whole new level of exploration into numerous factors such as the age of the child, if there are special needs or developmental reasons at play, if communication between parents is good, the distance between parents, the child’s preference, and possibly many other factors. And, then there is the mere practicality of working out schedules for the real world. We also face the reality that there is no true definitive scientific evidence that will support arguments for or against a true 50/50 possession schedules.

In high conflict divorces, most family law attorneys such as ourselves, will strive for the possession schedule that supports the Best Interest of the Child, which we try to balance against the desires of our clients. Truthfully, there are merits to everyone’s arguments to increasing possession and access time for both parents, but not at the expense of the children. Yet, this can be another difficult hurdle to jump since one parent’s definition of “best interest of the children” may not be the same as the other parent’s definition, for many reasons.

Based on our years in family law and our experience with these cases, the current SPO or expanded SPO in Texas continues to fit and work well for a large number of divorcing families. It does not fit them all. In our view, for many families, a 50/50 possession schedule is simply not practically attainable once such a schedule is outlined. We also believe a 50/50 possession schedule necessitates a healthy co-parenting relationship, which few couples can demonstrate. So, until we have definitive scientific evidence to the contrary, we believe the SPO will work for more families than JPC or a 50/50 schedule.

We do have scientific evidence that joint physical possession is linked to better outcomes than arrangements in which children have less than 35 percent time with the non-primary parent. Further evidence exists to support that any arrangement which reduces conflict, including limited exchanges, should be considered. We expect that as more jurisdictions promote shared parenting arrangements, there will be more opportunities to conduct research and gather data on what conditions best facilitate optimal shared parenting schedules and plans. Clearly, the increase in joint physical custody arrangements is an important change to watch now and in the years ahead.

For further discussion on this topic, or to answer your questions about 50/50 possession arrangements, call our office to schedule a consultation 713-932-7177.

 

 

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SAM M. (TREY) YATES, III, P.C. 2003.

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