Kathryn T. Joseph & Associates, Inc.

Cleveland Estate Planning Blog

Using the Veterans Aid & Attendance Pension Benefit for care

Veterans and the surviving spouses of veterans in Ohio may be eligible for a little-known benefit from the Department of Veteran Affairs. This program offers monthly benefits to help to pay for long-term care when people grow older and need help.

The Veterans Aid & Attendance Pension Benefit offers monthly payments to qualifying people to pay for private-pay nursing home care, in-home care, assisted living communities or board and care. The money is tax-free and is available in addition to other types of benefits that the recipients might receive.

What people get wrong about legacy planning

Ohio residents may believe that legacy planning is something that only a famous person would do. However, almost anyone could have a life's work or story to share. This is true whether a person is a writer, teacher or anyone else who has accomplished something. Therefore, creating a legacy plan is not necessarily an egotistical thing to do.

In fact, it can serve as a healthy outlet for those who want to preserve the work that they have done in their lives. When done properly, a legacy plan can serve as a road map to help an estate holder live their best life. It can also ensure that a person has an effective way to manage their wealth in a way that's organized and tax efficient. A life coach may also be a part of a team that creates and helps to implement a legacy plan.

Options for transferring assets upon death

Ohio residents may want to skip probate as it can be a long and expensive process. However, it may be avoided by creating a joint tenancy arrangement, which can allow an asset to pass solely to a survivor. This may be used on assets such as an investment or bank account, and it may override provisions put in a will or other estate plan documents.

One of the potential downsides to joint tenancy is that the other person may have access to funds within an account. This means that the other person could take money out of the account for any purpose whether it coincides with the original owner's wishes or not. Furthermore, if the joint tenant goes bankrupt or otherwise fails to pay creditors, money inside of a bank or other type of account could be seized by creditors.

Changing an estate plan during divorce

It is important for people in Ohio who are getting a divorce to keep their estate plans in mind. It may be necessary to make changes as soon as possible in order to ensure that their wishes are carried out. Otherwise, if a person dies unexpectedly, a spouse or soon-to-be ex-spouse may receive a large share of that person's estate.

For example, a man in Arizona received a large settlement after an accident. Initially, the man and his wife signed a prenuptial agreement to ensure the settlement, which was in a trust, remained his property. However, the man eventually signed 80 percent of the trust over to his wife and 20 percent to his family. Later, his wife filed for divorce. At that time, the man only needed to speak to his attorney and sign an amendment for the trust to ensure that all the money went to his family. However, he did not, and he died two days before the divorce decree was filed. As a result, the man's wife got $14.4 million and his family only got around $3.6 million.

How will you avoid the same old estate planning mistakes?

It doesn't matter if you are going through the estate planning process for the first time or have been down this path before, nothing changes the fact that you need to avoid any and every mistake.

While this sounds simple enough, it can be a challenge to get on the right path. You never know when something will pop up that gets in your way, thus causing trouble for you and/or your family.

Distributing personal property not included in a will

When an Ohio resident dies, there is likely to be property that family members must decide how to divide. There might not be a will, or there might be items of personal property that is not mentioned in the will.

Heirs may want to get an appraisal of property. This way, when they reach an agreement about how to divide it, there may be adjustments that take into account the value of some of the property. For example, one person might take valuable jewelry in lieu of less cash. However, even with property that has sentimental but not actual significant value, one heir might pay another in order to keep the property. There are a number of other creative financial solutions to distributing property using buyouts and trading. Even if the will specifies that a person should only receive a certain percentage of monetary distributions, this can be changed in negotiations as long as the other heirs agree to it.

Spendthrift trusts and thoughtful estate planning in Ohio

News stories about highly paid professional athletes who squander their earnings to the point of going broke and becoming destitute are uncomfortably common. What many people do not know is that this type of financial tragedy often happens to individuals who inherit sudden wealth as part of an estate plan; however, such cases seldom make headlines.

When estate planning attorneys work with wealthy clients, there comes a time when the financial aptitude and responsibility of heirs, particularly children, should be discussed. Some parents tend to be quite pragmatic about leaving their children considerable sums of money; they may think, "well, my sons will be adults when I pass. Let them figure out what to do." On the other hand, many parents are genuinely concerned about what could happen if their children blow their inheritance and become prematurely broke.

Wills aren't just for the wealthy

Many Ohio residents believe that they don't need a will. This is often because they have few, if any, assets and assume that there is no need to designate what happens to their money and belongings after they die. This is untrue.

Wills can benefit family members when the testator's affairs are being settled. Without a will, this process becomes more difficult and often more costly. This is because a will designates an executor, someone who is authorized to close the estate, while also providing instructions as to what should be done with any money, investments or property the testator leaves behind.

Long term care planning begins at 50

Ohio residents may not think it necessary to consider long term care planning while they are still so young and healthy as they are in their 50s. But that's exactly the point. Long term care is a thing that becomes much more difficult to plan for and establish for those who wait until they need it. Generally speaking, there are three approaches people take when it comes to planning for long term care. They plan to rely on Medicaid or other government programs, pay for it themselves or purchase insurance policies to cover costs.

One of the primary reasons Medicaid was established is to cover individual long term care costs. This is not Medicare, which does not pay for long term care. According to an independent broker and financial agent, relying on Medicare might make sense for individuals who have less than $200,000 in total retirement assets. The broker also advised speaking to an attorney who is knowledgeable about the inner workings of Medicaid prior to making any concrete determinations.

Tips for executors to make their jobs manageable

Ohio residents who are named the executor of an estate have many responsibilities. Fortunately, those who are unable or unwilling to fulfill the role may ask to be replaced. However, staying organized and asking for help when necessary may make the role easier to handle. Individuals who choose to undertake and fulfill their role as executors may find that they won't get much done without copies of a death certificate.

It is recommended that an executor ask for twice as many copies as he or she thinks is necessary. It may also be necessary to open a bank account in the name of the estate to handle financial transactions. An executor is responsible for paying debts and filing estate and income tax returns. It may be advisable to consult with a tax professional or an estate planning attorney for help with issues related to settling an estate.

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Kathryn T. Joseph & Associates, Inc.
Executive Commons West
29425 Chagrin Blvd.
Suite 305
Cleveland, OH 44122

Toll Free: 888-335-6650
Phone: 216-245-0504
Fax: 216-765-8817
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