In today’s economic climate, readers may have heard about reverse mortgages. The term refers to a type of borrowing arrangement specifically designed for older homeowners. Under the terms, a homeowner who is at least 62 years of age may borrow against a home’s value. Repayment obligations begin only when the homeowner moves out or passes away.
An attorney that specializes in elder law knows that long-term retirement and estate planning involves more than just financial matters. In the event of incapacitation or some type of sudden and unexpected event, a comprehensive legal plan should address issues of how decisions about healthcare, living expenses, financial planning and estate planning should be made.
Estate planning is more than just jotting your wishes down on a notepad. But, if you wish to avoid probate, you will need more than just a will. A will's primary function is to let the court know your wishes. There are other estate planning documents, though, that can help keep your estate out of probate. One of those is a revocable living trust.
A reverse mortgage is similar to a conventional mortgage in that it is a loan which uses the borrower's home as collateral. The biggest difference is that the loan generally does not need to be repaid until the last surviving homeowner permanently leaves the property or passes away. The estate then has six months to pay the balance of the mortgage in full or sell the home. If the proceeds from the sale exceed the amount needed to pay the mortgage, the difference will be placed in the estate. If the proceeds from the sale are less than the amount needed to payoff the mortgage the estate is not held personally liable.
Anyone who reaches adulthood needs to consider making up a will. If you have children, a will and trust are both critical. Not only does a designated will help you plan the disposition of your assets, it also helps protect your spouse, children, or any other surviving family members and friends who will be designated beneficiaries.
Let's face it: the majority of our lives exist online. Work email, personal email, junk email; Twitter, Facebook, Instagram, LinkedIn; online banking, paperless financial statements; iTunes, iCloud...iEverything. I even have online apps for keeping track of fitness and paying friends money owed. So, what happens to all of these when I die?In Massachusetts, a decedent dies either "intestate" (without a will) or "testate" (with a will). From there, in order to access probate assets and administer the estate, the court needs to appoint a Personal Representative. But, under Massachusetts law, the Personal Representative does not automatically have the power to access email accounts or various other internet sites. Problems can arise if the decedent used email to conduct business and now, no one can access those files. Or, the Personal Representative might want access to an email address book to notify people of the death. Additionally, not every social media site is uniform in its policy regarding deceased subscribers. Someone's Facebook page could be receiving writings on the wall years after they are gone but without authority, there might be little the Personal Representative can do to change that.
Families will often make financial gifts for specific purposes, such as to help a child with debt, pay for a grandchild's tuition, help a family member place a down payment to purchase a home, utilize the annual gift tax exclusion, or celebrate major family milestones. So, when would these gifts not be considered gifts?
Financial abuse of older people is increasing at an alarming rate, and are expected to continue to rise as the Baby Boom generation moves into the senior years. The concern is compounded by the fact that the number of people with Alzheimer's disease, which erodes mental acuity, is expected to "double, and perhaps triple, by 2050." In 2011, it was estimated to be close to $3 billion. Women are more likely to be victims of scams and other types of financial exploitation than male seniors by about a two-to-one margin. Sadly, about a third of this exploitation is perpetrated by friends, family and neighbors whom they trust to help them. The rate is probably higher because victims also are either ashamed or fearful.
For those who have assets of over $250,000, a well-planned estate is important. Some seniors and elderly people are often reluctant to discuss such plans. This could be due in some small part to how seniors and the elderly see themselves. Recently, 2,319 seniors of significant wealth and assets were surveyed. Almost 80 percent of those surveyed don't consider themselves as "elderly" until they hit 80 years old. Over 50 percent of those surveyed that were age 70 or over wouldn't even consider themselves "old."
Thinking about death is not something anyone likes to do, but death is inevitable to us all. Without the proper planning, though, the time after someone dies can quickly turn into a mess of probate court, feuding family members and chaos.