Legal Matters

Brought to you by: Community Partner Bradford & Holliman, www.bradfordholliman.com 

Two axioms that we estate planning attorneys know only too well are that “no one knows his expiration date,” and “no one checks out leaving a clean desk.” However, you should still leave an estate plan that your executor and heirs can use to finalize your affairs. You also need to designate a personal representative who can oversee your affairs even if you’re incapacitated. Here are six reasons why a very key component of your estate plan is a current list of passwords and accounts to manage your digital identity. 

1. Online orders: If you have standing repeat orders for items such as pet supplies or your favorite bagels, keep previous invoices to help your personal representative cancel the orders. 

2. Online banking and autopay bills: In most cases, utilities, insurance premiums, car, and mortgage payments need to be kept paid if you are incapacitated. In the case of your demise though, certain payments will need to be canceled. Leave details with your papers.

3. Social media accounts: You can now designate someone to oversee these accounts in their settings.

4. Online access to financial accounts and health insurance: A durable power of attorney helps, but having the company names, accounts, passwords, and type of account will help, especially if needed for your care.

5. Two-step encryption: This security tool is used increasingly to thwart hackers of online services. Make sure your personal representative’s email and cell phone are set up as options within the accounts. 

6. Device Passwords: When one 45-year-old died unexpectedly, her executor was left with a smartphone full of photos that are not accessible and a two-month-old tablet that cannot be re-used. Ten months later, the executor is still trying to get these devices unlocked through the manufacturers so that they can be cleaned and resold. 

If you are a very private person, store this information in a sealed envelope with your personal representative or executor right along with your Durable Power of Attorney, Healthcare Directive, and Last Will. And be sure to update the info regularly. You’ll have the peace of mind that your affairs will be easier to manage for your personal presentative or executor. 

-Melanie B. Holliman, JD 

Partner at Holliman & Holliman, PLLC

www.bradfordholliman.com

205-663-0281

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Holliman & Holliman, www.bradfordholliman.com

Two major new chapters of life are newly graduated seniors heading off to college and mature seniors retiring and downsizing their homes to retirement communities or even assisted living. Both new chapters need a fresh look at estate plans.

Late Teens. For the late teen heading off to college for the first time, a healthcare and durable power of attorney is critical. Students who go to college in other states may suddenly become adults legally meaning that parents have less authority to handle medical emergencies or finances. For example, Alabama’s age of majority is 19 while Tennessee, Georgia, Florida, and Louisiana’s age of majority is 18, and Mississippi’s age is 21. If a college student’s parents have been serving as custodians of a Uniform Transfers to Minors Act (UTMA) account, their custodial role ends when the student becomes a legal adult. The student now has complete control of the account. A durable power of attorney authorizes parents to continue directing investments and expenditures on behalf of their student. A will is also advisable unless the parents want their student’s assets to revert to them if the student were to die intestate (with no will).  For example, one adult college student set up his will naming his younger brother as the beneficiary of his “college account.”

Mature Seniors. If mature seniors have moved to Alabama from another state (and many do!), a local estate planning attorney can advise them about key differences in estate law. Pension beneficiaries should be checked, and new addresses provided to the former employers. An old estate plan should be cleaned up eliminating guardianship terms for minor children who are now fully grown. All beneficiaries, trustees, and executors should be verified and updated. Although Alabama does not require an executor to be an Alabama resident, an executor who lives near you is usually best. Terms relating to incapacity should define who will serve as either trustee or personal representative, keeping in mind who is qualified and nearby. When mature seniors set up new accounts, careful thought should be given to the beneficiaries so that it aligns with the rest of their estate plans.  

New chapters of life are exciting and sometimes scary, but a good estate planning attorney can make sure that your legal affairs are in order to address the new chapter… and that offers peace of mind.

-Melanie B. Holliman, JD 

Partner at Holliman & Holliman, LLC

www.bradfordholliman.com

205-663-0281

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman, bradfordholliman.com

Visiting your mother for Mother’s Day in May or your dad for Father’s Day in June? Consider a small spring-cleaning project in any attics, she-sheds, barns, or storage units. One lady in her seventies measures her progress by the trunk loads she takes to thrift stores. Be sure to suggest items that other siblings or grandchildren could use, and you will not come across as the greedy one. Masking tape makes great labels.

List the items and their locations and ask your parents to share their plans with the beneficiaries. These bequests do not have to be in their wills. In fact, your parents may get more pleasure by giving these items now rather than waiting for a will to be read. If they agree, update the inventory when items are given. Items could be valuable such as collectible paintings, woodturning tools, and jewelry, or nostalgic such as a grandmother’s very antique flour sifter, well-worn quilts, or notated Bibles. Your parents may enjoy an afternoon talking about the items in detail. 

Executors of wills and trusts have a lot of responsibility such as making interim and final estate reports back to the Probate Court. Make executors’ lives easier by giving personal items to recipients early or by creating a separate document with the details of who gets what. One elderly lady with ten grown children made a copy of her will for each child and wrote on the back what that child was to receive from her personal effects even down to the refrigerator. There is an old saying that you do not know a person’s character until you have divided an estate with him. Estate distributions often trigger family arguments, long-term grudges, and will disputes. A well-used lawnmower triggered a will dispute in one family. That may sound ridiculous, but when grief, high emotions, and childhood grievances are involved, logic often goes out the window. We strongly recommend that our clients share their estate plans with their beneficiaries while they are here to address any questions or concerns. The same goes for personal effects.

Take a shot at spring cleaning yourself so you can be an example to your parents. And keep your estate plan current with regular reviews with your estate planning attorney. You will all have a sense of lightness to go with the lengthening days.

-Melanie B. Holliman, JD 

Partner at Bradford & Holliman, LLC

www.bradfordholliman.com

205-663-0281

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters 

Brought to you by: Community Partner Bradford & Holliman, www.bradfordholliman.com

Do you understand your finances? Here are four reasons to know your finances even if your spouse usually manages them. 

1. Since women live longer than men and often have older spouses, women are likely to be the surviving spouses impacted by their husbands’ wills and property law. 

2. Divorces trigger the division of assets. Overall, the divorce rate in the U.S. is falling, but the divorce rate of couples over 50+ is increasing, and that means there are more assets to divide.

3. If you are considering a second marriage and have children from your first marriage, you may want to consider a prenuptial agreement and estate plan that protects those children’s inheritances. In the U.S., 19% are second marriages.

4. Setting up your estate plan so that both parties can manage affairs easily on their own when needed due to the incapacity or demise of one spouse.

Know how all your assets are titled. Your attorney needs to know how assets’ titles and beneficiaries to advise you for your estate plan. Individual ownership can be more advantageous than joint ownership due to direct gifts, grants, inheritances, and assets a spouse may have before marriage. But it was not always this way. 

Did You Know? Women’s Rights Related to Assets Have Really Changed! 

In honor of Women’s History Month, let’s take a quick view of how women’s rights relating to assets have improved:

• 1846- Women could own, but not control, property in their own names.
• 1849- Married women could own and manage property in their own names during the incapacity of their spouses. 
• 1867- Married women were granted separate economy which meant they could have a separate estate.
• 1870- Women were no longer considered property of their husbands or fathers.
• 1960s- Women could open their own bank accounts. 
• 1974- Women could have their own credit cards with no co-signers.
• 1974- Women could buy a house alone.
• 1981- For a husband to have sole control of marital property became unconstitutional by a U.S. Supreme Court case. 
• 1981- Alabama’s intestate or probate law was changed to be gender neutral. 

A couple’s finances require day-to-day management, long-term strategic plans, and estate plans. You and your spouse should talk about finances on all these levels to make sure you are both “rowing in the same direction…” and then make sure your estate plan is in line with your direction.

–Melanie B. Holliman, JD 

Partner at Bradford & Holliman, LLC

www.bradfordholliman.com

205-663-0281

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman, www.bradfordholliman.com

What is a Legal Matters article doing discussing date nights to enrich your marriage? Legal matters such as estate plans are a spectacular way of letting each other know now just how important your marriage is by making sure you are on the same page. Each spouse should be ready to manage family affairs if the other is not there. Estate lawyers often talk about the peace of mind that a current estate plan provides clients. That estate plan can also provide a long-term sense of love and caring long after one of you is gone.

Plan a date night to discuss each of your individual thoughts on your estate plans (you do at least have wills, don’t you?), beneficiaries on IRAs, pensions, life insurance, and financial situations of elderly family members. You may be surprised by the assumptions each of you hold. Date night without kids in tow is a great time to talk about best guardians for any minor children. With 50% of children impacted by a divorce, the specifics of divorce decrees are a major factor in setting up estate plans. If you have adult children who are in stressful marriages or who do not manage finances well, you may want to talk about how your estate plan could be structured to prevent your child from losing inheritances in a bitter divorce or how to keep your adult child from misusing any future inheritance.

If one spouse exclusively manages family finances, make the discussion for one date night about how finances are managed and who the key contacts are – financial advisors, accountants, and even personnel contacts at employers. A one-month swap of day-to-day financial duties can be eye-opening for the spouse who does not usually manage it. Such as swap often increases the appreciation for the spouse who manages it.

In fact, these discussions could take several date nights even beyond February. These conversations are key to have even before you call your estate planning attorney. An experienced estate planning attorney can provide options you may not know about such as spendthrift trusts and can also make sure that your estate plan aligns with current Alabama estate laws. Add a little candlelight and tasty food, and your date nights can enrich your marriage and give you both peace of mind for a long time.

-Melanie B. Holliman, JD 

Partner at Bradford & Holliman, LLC

www.bradfordholliman.com

205-663-0281

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman

A new year is here. What did you put off last year that is still on your “to do” list?  In a great New York Times article in March 2019, Erik Winkowski wrote that “procrastination is about emotions, not productivity.” It’s more fun to alphabetize your spices than to review your estate plan and beneficiaries or update your net worth. It’s not time you lack; it’s the emotional fortitude to take the proverbial “bull by the horns” to tackle a job that is often tied to mixed emotions.

That’s one of the big advantages of having an experienced estate planning attorney on your team of advisors. A good lawyer can make sure your estate plan does not have legal gaps created by new estate legislation. And a good estate planning attorney will proactively ask you questions about your estate that you might not even think about if the whole process makes you uncomfortable. A one-size-fits-all form downloaded from an online site certainly can’t help you there. 

You should also update your net worth as part of a review of your estate plan so that you know what you have to bequeath, whether it is an antique train collection or a well-funded IRA. A current net worth helps you avoid forgetting an important asset. Updating your net worth in January will help when you get around to working on your 2022 taxes before April. Your accountant will thank you… and might charge you less.

One family I know often uses the phrase, “I haven’t gotten around to it.” Just make sure you get around to it when it comes to taking charge of your estate plan and net worth. You really don’t want to depend on Alabama’s estate laws for folks who die without a legally documented estate plan (intestate). To find an experienced estate planning attorney near you, check online with AVVO, National Academy of Elder Law Attorneys (NAELA), and Martindale.

-Melanie B. Holliman, JD 

Partner at Bradford & Holliman, LLC

www.bradfordholliman.com

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman

More than ever, gift giving is fraught with peril this year. Consider the overseas shipping and delivery problems to stores near you, the increasing cost of shipping gifts to your loved ones, the predicted difficulties of timing when your gifts arrive, the possibility of your gift being the wrong size, color, style, or even a duplicate. Avoid all these issues and send a gift that is perfectly customized to your loved ones’ needs – funds for a full estate plan. Your own estate planning attorney can help locate an experienced estate planning attorney in your loved one’s hometown if needed.

A quick online search will tell you: “A staggering 79 percent of millennials (ages 18-34) do not have a will. Even more surprising is that 62 percent of those in the 35 to 44-year-old age group don’t have a will or living trust, and 60 percent of those in the 45 to 54-year-old age group don’t have one either.”  Now, it’s not that millennials don’t think wills are necessary. They just assume they can get around to it when they hit their fifties. Single millennials often assume that their families can just take care of matters using the state’s intestate laws… without researching what those laws are. Mistake! And that’s not even mentioning the critical need for financial and healthcare powers of attorney, healthcare directives, a plan for personal belongings, and guardians for their minor children.

If you are lucky enough to be with your loved ones in person during the holidays, use this strategic gift to discuss your own estate plan and the reasons behind it so that no unpleasant surprises create family problems after you’re gone. Perhaps combined with the joy of the season, this longer-term expression of affection will mean even more to your loved ones. And if changes in family members have occurred recently due to births, deaths, or divorces, give yourself the same strategic gift by updating your own estate plan.  

-Melanie B. Holliman, JD

Partner at Bradford & Holliman 

Estate Planning, Trusts & Special Needs

205-663-0281

www.bradfordholliman.com

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman 

Home care or hospice is stressful for families, but some legal tools can relieve at least some of the stress. With home care, families are faced with hiring an agency or becoming a direct employer of caregivers; both involve writing a lot of checks.  

A specific Power of Attorney naming an adult child is better than adding a child to the parent’s checking account in most cases. When the parent passes away, the assets in the Power of Attorney-managed bank account remain part of the estate to be divided as the will specifies. However, if one child is on the parent’s checking account, at the parent’s death, that entire checking account becomes the property of that child and is not divided according to a will’s terms.

Be sure a Durable Power of Attorney covers both financial and healthcare decisions. It is okay to have the sibling who just happens to be a CPA oversee the financial matters and the sibling who is in healthcare oversee the healthcare decisions. Healthcare directives are still needed. And the will could specify yet another sibling as the executor since, after the parent’s demise, the power of attorney has no power.

A critical factor is to set up these legal tools in advance since many patients requiring home care or hospice may no longer be legally competent, especially in cases of dementia or Alzheimer’s disease. A family should have their parent’s net worth summary or at least a listing of all financial accounts, contacts, and beneficiary designations because these factors impact filing for Medicaid, if needed, and eventually, the settling of an estate. 

Since powers of attorney aren’t valid after death, families need to plan funeral and burial plans. If using a will, pre-need plans for the funeral and burial may be useful in reducing families’ stress. A trust can continue after death and handle these plans. When in her upper 90s, one lady (who lived to be over 100) had a trust in place, a power of attorney, healthcare directives, and set up her pre-need plan with her local funeral home. Her heirs were ever so grateful. 

If you have an elderly family member facing home care or hospice, check with a qualified estate attorney to make sure that you have the right legal tools in place during this stressful time.

-Melanie B. Holliman, JD 

Partner at Bradford & Holliman 

Estate Planning, Trusts & Special Needs

205-663-0281

www.bradfordholliman.com

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.

Legal Matters

Brought to you by: Community Partner Bradford & Holliman 

The phrases “I want to set up a trust” or “you need a trust” are heard often in estate planning attorneys’ and financial advisors’ offices. The phrases are simple but can mean many different things. The first thing to understand is that a “trust” is not a simple document where the client fills in the blanks. We like to say that a trust is not like a one size fits all t-shirt. Trusts are not just for the super wealthy either.

Trusts are contracts designed to fulfill a client’s specific goals. These goals determine the type of trust and the terms of the trust. Even the title of the trust does not tell the reader very much. A family trust can mean many different things depending on the wording of the document. A revocable trust should mean that the trustmaker can revoke or terminate the trust, but the terms and conditions of the trust can be as varied as the colors of the rainbow. Two of the basic types of trusts are:

1. Revocable Trusts allow the trustmaker to stay in control of the trustmaker’s assets. The trust should avoid the probate process at the trustmaker’s death and make the transfer of assets to the designated beneficiaries much faster and easier. These trusts also provide more privacy since they can avoid public access to probate records. Revocable trusts do not have asset protection features of irrevocable trusts precisely because the trustmaker is still in total control.

2. Asset Protection Trusts, if designed correctly, should protect the trustmaker’s assets from creditors. They are generally irrevocable. The laws of the state where the trust is created have a lot to do with the level of protection the trustmaker receives.  Some states have laws that offer more protection than others.  

Using the framework of these trusts, a trustmaker may do everything from directing when a minor grandchild receives an inheritance to implementing plans to reduce capital gains taxes, income taxes, investment for growth, and estate taxes. Most importantly, remember that any form of trust planning takes an experienced estate planning attorney to guide you through the process of determining the appropriate type of trust and the specific terms that should be included in the trust. The second most important item is that you must then put your assets into the trust by updating titles of financial accounts, real estate, and real property.  

-Melanie B. Holliman, JD

Partner at Bradford & Holliman 

Estate Planning, Trusts & Special Needs

205-663-0281

www.bradfordholliman.com

No representation is made that the quality of the legal service to be performed is greater than the quality of service performed by other lawyers.