Q: My friend and I are trying to get our legal papers in order and are having a disagreement on what paper or papers take precedence. She said that a will is the final word, while I was always told that other ways of leaving money, such as naming a beneficiary, would be the form that would be followed. Can you shed some light?
A: First, congratulations to both of you for putting your legal papers in order. It is so important to have these issues set in print. Your assets, when you are gone, go to the person or people you want to have them.
It is also important to know which legal form takes precedence; if you don’t, you may end up leaving a particular asset or assets to an unintended person or people.
To make sure I understood some of the methods of leaving assets, I spent some time with an expert in the field and found the following:
Beneficiaries you designate on life insurance policies, investment accounts such as 401(k)s and IRAs and U.S. Savings Bonds will take precedence over those you name in your will.
If you fail to designate a beneficiary or you name your estate as the beneficiary of your IRA or life insurance policy, the assets involved will be subject to probate, which is a time-consuming and expensive legal process.
Naming your trust as the beneficiary of your retirement accounts can be a problem where there are significant differences in the ages of your heirs. If a tax-advantaged retirement plan’s designated beneficiary is your trust, it will affect how your heirs may make withdrawals.
A transfer or payable-on-death designation is another method of leaving assets. You will find this method is commonly used for investments and bank accounts. It is comparable to joint ownership, except that with a transfer or payable-on-death designation the beneficiary has no control until the owner dies.
Joint ownership is another way to pass on assets, but it does have drawbacks in that the person named as the joint tenant has ownership rights and there is risk if the joint tenant is sued.
Once your legal papers are in place, don’t forget to update beneficiary designations if you divorce, remarry or are widowed.
It is so easy to forget to update these important papers when family status changes. Even if family status doesn’t change, your legal papers should be reviewed every few years to make sure they will do what you intended them to do.
There are many ways to name your heirs and every family is unique. When doing your estate planning it is advisable to work with an estate planning attorney to get it right because when the time comes to execute those papers you won’t be around to say how it should be done.
Q: I have seen advertising for attorneys who specialize in elder law. Exactly what is elder law and do I need this type of specialist?
A: An excellent question. An elder law attorney generally advises older clients regarding legal problems that are common to the senior population including estate planning and probate. Elder law attorneys are also well-versed in such public benefits as Medicare, Medi-Cal and Social Security.
An elder law attorney might also be consulted for long-term care planning, including nursing home admission contracts, prevention of spousal impoverishment and resident rights.
An elder law attorney can also be of help in planning for possible incapacity. Decisions about how healthcare and financial transactions will be resolved if you are unable to act on your own behalf are of utmost importance.
Methods available to resolve these issues include a power of attorney, an advance directive for healthcare and a living will.
The elder law attorney can also advise on conservatorship and guardianship proceedings in the event incapacity is not preplanned.
Many attorneys who specialize in this area are familiar with other professionals who serve the senior population. Referrals made to ombudsmen and social workers can provide additional necessary services.
Do you need an elder law specialist? That depends on your situation. If you already have a good working relationship with an attorney ask about his or her experience with the typical issues of elder law. If your attorney is experienced in these areas there is little need to go elsewhere.
The Ventura County Law Library, 800 S. Victoria Ave. in Ventura, is hosting the Lawyers at the Library speaker series. Call 642-8982 for more information. Here are upcoming topics:
Aug. 12 from 5:30 to 6:30 p.m. — Attorneys from Cunningham Legal will discuss the “Top 8 Medi-Cal Mistakes You Don’t Want to Make.” On Sept. 9 the subject will be “IRA Inheritance Trusts.”