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Estate Planning: Consider A Living Trust

As part of your estate planning needs, you must consider a living trust, often referred to as a revocable or “inter vivos” trust. If you are a California resident and have more in than $100,000 in assets, a living trust will help you avoid probate or conservatorship down the road. If your estate goes into probate or conservatorship, it can cost considerable time and money for resolution. Also, court documents are eventually made public – which can lead to an unfortunate loss of privacy.

A trust is a legal arrangement under which one person is designated a "trustee." He or she will hold the legal title to property for another person, the beneficiary. You will be the trustee of your own living trust, so you retain full control over all property held in the trust. A "living trust" is a trust you create while you are alive, instead of one which is created at your death. You may wish to create a living trust as a way to reduce your estate taxes, structure long-term property management or avoid probate.

If you are considering a living trust, keep in mind that it must be well drafted; a vague trust can leave too much room for trustee error, or doubts may be cast on its validity, leading to a litigation nightmare. Be sure to work with an experienced living trust attorney to ensure that your trust is competently drafted. The attorneys at Gilfix and La Poll can assist you in determining if a living trust is the best choice for your estate plans.

Gifts to Grandchildren: UGMA and UTMA

Two attractive financial options for some of our clients exploring estate planning options for their grandchildren can be found with the Gifts to Minors Act (UGMA) and the Uniform Transfers to Minors Act. These are two college savings accounts which allow a grandparent to gift money to an account set up by the parent of a minor child as a custodial account. The account, in the name of the child, allows gifting without tax liability; such gifts are irrevocable, but you can keep control of the funds in terms of where it will be invested.

The Gifts to Minors Act is typically limited to investments towards certificates of deposit, life insurance and cash, while the Uniform Transfers to Minors Act allows you to invest in stocks, bonds, real estate and mutual finds. Both types of accounts should be managed by someone other than a parent; a parent would incur taxes on the account income.

The potential downside: When the child reaches the age of majority (18 in California), the child owns the account funds. This could jeopardize the child's eligibility for college financial aid, and may not be the age at which you want them to have access to the funds. An 18 year old is not likely to be the wisest money manager, as well.

If you are considering establishing a fund, or would like to explore your estate options, please speak with the estate planning attorneys at Gilfix And La Poll.

Gilfix (No. 110) Participates, Places in 2013 National Senior Games in Cleveland, Ohio.

Gilfix BL_July_3 image 1  (2)In 2012, Michael Gilfix (age 66) qualified for the 2013 National Senior Games by winning both the 5K and 10K races in his 65-to-69 age bracket at the California Senior Games.

Mike participated in the 5K race on July 23, 2013 in the National Games in Cleveland.  In a challenging national field, Mike placed 8th with a time of 22 minutes and 42 seconds on a hilly course through the grounds of the Cleveland Zoo.  Mike averaged 7 minutes and 17 seconds per mile.

"It was inspiring to compete with top runners from across the nation.  Some were as young as 50.  Some were in their nineties," observes Mr. Gilfix.  "In my age group, the winner ran 6 minute and 26 second miles.  Very impressive!" 

Congratulations to Mike!

Gilfix BL_July_3 image 1  (1)

Expanded Free And Available Health Services For California Seniors; Long-Term Care Costs Not Addressed

While California enjoys the reputation of a destination state -- outdoor recreation, abundant fresh produce, and often mild weather -- the state was recently ranked 25th in terms of senior health. Even though seniors are typically living longer, more of them are doing so in a state of suboptimal health.

Meanwhile, resources for healthcare have never been more easily available. A number of free or extremely affordable preventive health tests and screenings are now being provided to seniors under the Affordable Care Act. In some cases, these services may require a small co-pay, but many do not, and all are offered without any insurance deductible for seniors.

For example, doctors who participate in Medicare are now offering a free annual wellness exam. Use this opportunity to work with your primary care physician on a 12-month wellness plan. If you have just enrolled in Medicare, you will receive a "Welcome to Medicare" exam at no cost, as well. Physicians are using it as a preventative baseline check to help plan out an ongoing wellness approach with their new patients. Other services provided for free under the Affordable Care Act include smoking cessation services, bone mass measurements, flu shots, Hepatitis B shots, abdominal aortic aneurysm screenings, and medical nutrition therapy services.

Take advantage of these opportunities to keep up with your heath maintenance. That means getting an annual flu shot and staying current on all immunizations. Go in for regular dental cleanings and medical checkups. Keep an eye on your blood pressure and cholesterol levels; the levels may seem like a small part of your overall health, but healthy blood pressure and cholesterol numbers mean a lowered risk for stroke and heart disease.

The Affordable Care Act does not address the cost of long-term care, nor does Medicare pay for skilled nursing facilities ($5,000 - $10,000). To cover such costs, Medi-Cal is the only governmental source of assistance.

What else can seniors do to take charge of their health and enjoy their later years? Numerous studies have shown that keeping an active interest in intellectual pursuits slows the development of dementia or other types of cognitive decline. Take up a new hobby or learn a new skill. Work on puzzles, brain teasers, crossword puzzles. Take music lessons, or learn a new language. Even things as simple as taking an interesting class at a community center or brushing up on math can make a huge difference in brain activity.

Be sure to get regular exercise. It may be walking every day, or biking on the weekends, or taking an exercise class at the gym most mornings. Focus both on leisure activities which are enjoyable and physical activities which get you moving; you do not have to put too much of a strain on your body. Get outside, get active and have fun.

For Medi-Cal planning assistance, talk with a knowledgeable attorney who can guide you through the maze.