Estate Planning For Women (And the Men Who Love Them)

A fellow attorney (and award-winning journalist) Deborah Jacobs authored the book, “Estate Planning Smarts: A Practical, User-Friendly, Action-Oriented Guide”.  In her recent Forbes article titled “Estate Planning for Women (And the Men who Love Them)” she indicated the below question is a question every financially savvy woman should be able to answer. 

Question #4

Who would raise your children?

Few prospects are more wrenching than the possibility that young children will be orphaned. Often, parents put off writing a will because this particular thought is unbearable or couples cannot agree on a potential guardian. Some assume--incorrectly--that it is enough just to ask a relative or trusted friend to step in if the need arises.

But not formalizing the arrangements and doing some estate planning along the way could leave your children in a vacuum. For example, let's say you are a single or surviving parent--in this group too, women predominate. If you do not have a written document outlining your wishes, a court usually decides who will fill your shoes. A custody battle might erupt or, awful as it sounds, no one may want your children. And without financial planning, there may not be enough money for your child's support.

When choosing a guardian, people typically look first to relatives, starting with their own siblings--the child's aunts and uncles. A second choice for some people is their own parents, if they are young enough. Even if certain family members seem like obvious candidates, take into account all the factors involved. Key questions to ask: Am I comfortable with the individual's lifestyle and values? Would my child have to relocate? Can the prospective guardian incorporate my children into his or her household? If I have more than one child, would the guardian be able to keep them together? Does my child already have a relationship and a good rapport with the person?

Here too, you can build in checks and balances--by putting a different person in charge of the money you leave for your child's support. You can name a guardian for the funds, or put them into a trust and designate a trustee to spend the money on your child's behalf. While financial guardianships are a matter of state law and require court supervision in some states, trusts are a private matter. A trust also gives you much more say over how the money is spent.

Questions like this one can often trigger even more questions in your mind.  Please accept my invitation to schedule a meeting where we can discuss this topic and others that might be relevant to your estate planning.  Give my office a call to set a meeting.

 

Enjoy a public domain Christmas

'Tis the season to be jolly. That familiar line actually comes from a song titled, “Deck the Halls,” which you have no doubt sung a hundred times, as I have too. Just the mention of the name gets the tune running through my head. And why not? It's a holiday staple that plays on radio, television, and in elevators all over the world during this time of year.

Of course, there's a reason “Deck the Halls,” is so popular. It's in the public domain. Because of its status as a song in the public domain there is no royalty to pay for singing it, or recording your kids singing it and posting it to YouTube, or breaking out into a chorus of it while you're being interviewed on national television.

You see songs are intellectual property. They are owned by somebody. Or at least a lot of them are. And many of those song owners (people like Sting, Paul McCartney, Lady Gaga, or Adele) earn their living by collecting royalties for the songs they wrote. Each time someone plays their song on a jukebox, or on the radio, or sings it on a show – the writer collects a royalty payment.

At least that is the way it is supposed to work. In many cases people use their favorite songs as soundtracks to homemade videos of their wedding, or of their children opening Christmas presents, or of dad shoveling snow from the driveway – without realizing they are actually stealing something of value.

It's a little like the story of Napster, but on a smaller scale.

That brings us back to “Deck the Halls.” You see, “Deck the Halls,” was written a long, long time ago. So long ago in fact that there is no copyright on it. Which is what makes “Deck the Halls” a song that resides in the public domain. Nobody owns it now, so you can sing it with impunity without risk of the owner demanding payment – even if you sing it on television in front of millions of people, or on the stage at New York's Radio City Music Hall in front of a sold out audience (and good for you if you get that chance).

The catch to all this is that you have to perform the song, or someone you know has to be singing. It has to be an original performance, not a previously released recording of someone else. You see, if you use a recording of your family singing the song, you should be in good shape. But if you use a recording of Old Blue Eyes singing a Christmas classic, that's something else entirely. You see, the song may be in the public domain, but the recording of the song may not be. In that case it is the performance that is copyrighted, not the song itself.

Basically, “Deck the Halls,” is in the public domain, but a recording of Frank Sinatra, or Tony Bennett singing it wouldn't be.

So go ahead and have a festive, song-filled holiday season. Enjoy yourself and the warmth of your family and friends. You can sing to your hearts content and even share the recordings you make of some of those songs. But before you post your revelry to the Internet, you might want to check to be sure the song you're singing is in the public domain, rather than one that has a valid copyright that's owned, and potentially being enforced by the owner.

Nobody wants to have a joyous, festive Christmas followed by a miserable, litigation filled New Year. Certainly, not you.

Government Cuts Affect Nursing Homes

One of my WealthCounsel colleagues posted a comment on the potential for concern about nursing home care levels.  Lizette Sundvick targets this concern that appeared in this article: “Medicare Cuts Could Up Nursing Home Costs” SmartMoney.

Nursing home residents may soon face higher costs and reduced services, as planned Medicare spending cuts take effect this fall. 

The last few months have been a wild ride on multiple levels, to include concerns over Medicare and the “debt crisis.” While many more challenges lie ahead in terms of budget cuts, some cuts already have been made under the radar screen. Several you should know about actually go into effect this fall, as reported in a recent SmartMoney article.

According to SmartMoney, nursing home residents could face higher costs or reduced care once these cuts kick in.

Background

On July 29, The Centers for Medicare and Medicaid Services (CMS) decided and announced that they would be compensating for last year’s $4 billion shortfall by cutting reimbursement rates to nursing homes by 11.1%. In real terms, the shortfall is going to reduce government reimbursements to nursing homes. In 2010, nursing homes increased charges on residents by an average of 5%. Bad news: These reduced government reimbursements likely will trigger even higher nursing home costs for residents beginning this fall. Alternatively, it might trigger a reduction in services to nursing home residents. Either way, the forecast is not pleasant.

Perhaps I am wrong. Perhaps nursing home residents won’t see increases in costs or decreases in services. After all, the CMS actually justifies the 11.1% cut by pointing out that it is simply a more accurate reimbursement amount based on a government report indicating that Medicare has been overpaying. In fact, a spokesperson for the CMS maintains, “We do not believe that nursing homes will respond to the payment changes by decreasing the quality of care furnished to patients. However, we intend to carefully monitor changes in utilization and staffing patterns to ensure that patients continue to receive high quality care.”

Still, the nursing home industry appears to be monitoring the situation with caution. Bottom line: If you have a loved one in a nursing home, then you, too, should take notice.  Keeping abreast of current economic changes keeps you prepared for changes you may need to make on behalf of your loved one.  

The potential for drastic changes in long term care environment serve as reminders that our power of attorney and healthcare directives need to be up-to-date and relevant.  If you want assurance that your plans are up-to-date, then let’s get a meeting scheduled to review your plans.