Kids / Minors / Children Issues Archives - Page 2 of 3

Second Wives: Reapers of Sorrow, Destroyers of Family Wealth!

Posted on June 14, 2017

In a world where our assets are constantly under threat from usurious taxes, government largess, financial predators and rapacious offspring, there is still NO worse threat to intergenerational family wealth than a second wife. People get married the first time for any one of a number of reasons: Family pressure, filling a void, the urge to have children, an inexplicable desire to emulate the lives of Al and Peg Bundy and passion. But these first marriages often end, sometimes with children left in their wake, and are replaced by a second marriage based on love, devotion and emotional security. In these second (or third) marriages, often one spouse tends to be significantly older and more financially secure than

The Roadmap to Your Family Should be in Your Will

Posted on June 9, 2017

The cornerstone of Probate, leaving your estate to whomever you want, is almost paradoxical since the process is not as easy as most people think. To the great surprise of heirs that are listed in the Will, the decedent’s descendants (or next closest relatives) must be put on notice during the Probate process to validate the Will. The very concept of the requirement of placing the next of kin on notice is foreign to most clients: Why does a person’s nearest relative, who the Testator may have loathed, still have to be placed on notice of the Probate of the Will, even if that relative is being disinherited? The answer: Our estate laws allow your closest family members the right

UTMA Accounts: The Good, Bad and Ugly

Posted on March 21, 2017

Uniform Transfer to Minors Act accounts allow a person to leave funds to a minor beneficiary without a court’s interference. In general, minors are not legally able to own property. If a minor comes into possession of a bank or investment account or proceeds from a life insurance policy or retirement plan, a court may have to appoint a guardian over the property. UTMA accounts sidestep this requirement by naming a custodian over the funds: the custodian oversees and invests the funds until the minor turns 21 years old. However, just because UTMAs avoid court oversight, does not mean they are devoid of other problems: Poor Investment Decisions: A custodian who invests the funds poorly relies on state

5 Special Provisions You Should Add to Your Will

Posted on March 15, 2017

At some level, American Wills have not changed much in the last 200 years: Just like in old-timey England you need to (1) state who gets what, particularly anything left-over (your residuary estate), (2) who shall manage your estate’s affairs (your Executor), (3) you need to sign your Will or have someone do it for you in your presence with your permission if you don’t do so yourself, and (4) you need two disinterested witnesses who sign your Will in your presence as you state it is your Will. However, there are a few modern developments and government programs that justify adding the following provisions to even the most routine Wills: Contingent Ownership of a 529 Plan: If you

How a Grandparent Should Gift Money to a New York 529 Plan

Posted on January 27, 2017

Funding a grandchild’s college education can be a beast: The amount of money that may have paid for your child’s four year undergraduate education may only pay for one year’s worth of tuition for your grandchild. This coupled with increasing housing costs and other relentless modern-day living expenses, make it hard for your children to adequately fund a 529 Plan to pay for your grandchildren’s college education. Here are a few ownership and funding choices a grandparent may want to consider when funding a 529 Plan for a grandchild: Open a 529 Plan as the Owner: Funding a 529 Plan is unlike most gifts. For most transfers, once you make a gift you have no way to get

Trusts: How to Protect a (Troubled) Child from Your Money

Posted on December 3, 2016

Parents: You are responsible for the financial education and well-being of your child. You have more life experience, you are the ones who brought your children into the world, and you are the one leaving your money to them. So take the extra step and make sure you give your children money in a responsible way. We’ve all heard of it: The child who spent all of his inheritance before he received it, the gambler, the substance abuser, spendthrift, and so on. In 2011, I had a 29 year old female client, whom I shall call “Janice” who didn’t have one penny to her name: Janice was living in a homeless shelter, on all types of public assistance, and almost thoroughly ignored

Simple Dos and Don’ts of Gifting for College Education

Posted on August 1, 2016

Higher education is usuriously expensive. The fact that a child’s education may cost as much as you paid for your first house should highlight the importance of gifting these funds in the correct way. You can pay an unlimited amount of money for a child’s education expenses, provided you pay the money directly to the educational institution. Qualified education expenses are looked at as a benefit to public policy, and therefore do not require the donor to fill in a gift tax return. The funds are also not deducted from your lifetime gift tax exemption, meaning you can continue to gift additional funds without having to assess a tax. Paying a child back for their student loan payments

When Do I Tell My Children They Are My Financial & Health Agents?

Posted on June 28, 2016

Most people name their children as their agents (or else as successor agents if the client has a spouse). This includes naming a child as a Power of Attorney, Health Care Proxy, Executor or Successor Trustee. Of course, the child sometimes doesn’t know about this, and many attorneys do not discuss the topic in depth with the client. Most children don’t even know where their parent’s legal documents are. This can cause confusion, and can lead to their frantic scrambling at crucial times. Knowing when to tell your children they are agents is tricky, and often relies on a case-by-case analysis of the family and the children. Some 21 year olds may be ready to know their role before some 40 year

The Missing Pre Nup: Add a Family Trusts Band Aid

Posted on May 20, 2016

Attention parents with assets: Tell your children they must have a prenuptial agreement! And when they respond “No, I love him, that is not romantic, we will be together forever!”……panic!!! Then take a breath…PANIC a little more, then contact your T&E attorney to discuss how to protect your family assets using a family trust with a suitable trustee. The Family Court (more appropriately called the “Divorce and Fleece Court”) is known as a “court of equity”, meaning it can look at any factor relating to assets and income, and make a completely subjective (some may say arbitrary) decision as to who gets what. When a child is too shy or stubborn to get a prenuptial agreement, it is your job

College Kids in Trouble: Parents as Health Care Agent for Children

Posted on April 13, 2016

When a person may be subjectively considered an adult varies based on the person and the observing individual: My clients presume I was an adult long ago, my parents have begrudgingly accepted I may have final come of age, and an ex-girlfriend stated moments after we broke up that I would remain a child for the rest of my life. Fortunately, that girlfriend is long gone and, fortunately for her other ex-boyfriends and the rest of us in doubt as to our maturity, the law states that we are all considered an adult for legal purposes at age 18. This is an interesting public policy, since we are not physically or emotionally finished maturing at that age, and (probably due