Planning for the future involves important decisions about protecting your assets, providing for your loved ones, and ensuring your wishes are respected. Understanding the differences between estate planning tools, such as wills and trusts, can help you make informed choices for yourself and your family.
At Meyer & Spencer, P.C., we help individuals and families throughout Westchester and Putnam Counties, New York, navigate the estate planning process with clarity and confidence.
Explore our educational video below to learn more about wills and trusts, how they differ, and what to consider when determining which option may be right for your needs.
There’s really no right or wrong answer, but I think it’s a good idea to have the same person fill the roles of executor, guardian, and trustee. If you project out and your kids are in the custody of your guardian, would you want that guardian to have to go knock on someone else’s door to get funds? The flip side of that is if you have someone who’s really good with kids, you can name them as guardian and then have someone who’s good at financial management handle the funds.
You can definitely prevent a former son-in-law or former daughter-in-law from getting your child’s inheritance. What they need to do or what you need to do is really to plan for you. You can either instruct your child to no co-mingle their inheritance with their other assets or you can provide for a trust for your child so that the divorcing spouse cannot attach that asset.
Yes, you can use a will to name a guardian and an alternate for your young children, and a trustee to manage property. The guardian basically has physical custody. The trustee manages the finance. That can be one and the same person. A lot of times it’s better to have one person handling both of those roles.
We believe everyone needs a will as part of the four corners of their estate plan. Those four corners are: a will, a healthcare policy, a living will, and a power of attorney. The will allows parents to appoint a guardian for their children, as well as for the disposition of their assets. Some people may want a trust, but that’s something that should all be done in consultation with an attorney.
The way you hold title can certainly make a difference in the estate plan. It can interfere with the plan sometimes. If you hold assets jointly with another person, upon your death by operation of law that person owns that asset instantaneously. This is good to avoid probate. There are a lot of benefits for having joint tenancies on assets. However, you should review it with your attorney because it can complicate the overall estate plan.
Courts may not even entertain a guardianship petition if there’s a valid power of attorney in place. The powers are very similar. Basically, in a guardianship, the guardian stands in the shoes of the incapacitated person. Likewise, an agent on a power of attorney stands in the shoes of the principal. The powers are very similar. The costs are very different. Guardianship proceedings can be very expensive, where power of attorney is a very simple document that is not expensive at all.
With special needs children, there are certain challenges. The biggest one, if you leave an outright inheritance to a special needs child, that can knock them off any benefits they would be receiving or eligible for. Something you don’t want to do. By creating a supplemental needs trust, you’re allowed to supplement whatever benefits the child is receiving instead of knocking them off.
You should consider long-term care insurance during the estate planning process, as well as a review of all your insurances, your life insurance. Insurance helps round out an estate plan. It can benefit a family who might be trying to do Medicaid planning. The long-term care provides for a daily benefit for nursing home costs, which saves the family’s estate potentially tens of thousands of dollars. That should be done in consultation with an insurance professional.
We think most people can benefit from having a general power of attorney whether it’s just for your convenience to allow someone to make financial decisions when you’re not available. Typically a husband and wife situation. Or if you become incapacitated a general power of attorney might help you avoid the time and expense associated with having a guardian appointed for you. This document should be signed in the presence of counsel and with the advice of counsel.
trust is essentially a contract between the grantor, the person creating the trust, and the trustee, the person who’s going to administer the trust. The trust, if you think of it as a box, where you put assets into the box. You can take assets, put them in, take them out at your discretion if it’s a revocable living trust. On an irrevocable trust, once you put the assets into the trust, they have to stay in the box. You could get income out of that box, but for the most part, the asset has to stay in the box. Any trust planning should be done on the advice of counsel.
Proper estate planning includes four corners: a will or a trust, a healthcare proxy, a living will, a power of attorney. The will or the trust, that provides for the disposition of your assets and in a will you can also name a guardian for your minor children. A healthcare proxy, you appoint an agent for to make healthcare decisions for you. A living will is a simple statement by you of what life saving measures you would decline in very limited circumstances. Then a power of attorney, the financial document that helps an agent make financial decisions for you in case you are incapacitated.
Funding a trust is placing assets into a trust. A lot of people make the mistake and they don’t fully fund. Picture the trust as an empty box, you come in, you sign a nice fancy document, at that point, all you have is a nice empty box. You then have to put assets into it. With real estate, you change the title on the deed to your house. That takes it out of your individual name and puts it into the trust. For your financial assets and investments, you have to go to your brokerage firm, change the title on the account from your individual name into the trust name and that funds the trust.
Your beneficiary designations have the benefit of avoiding probate so any assets that have a beneficiary designation, an annuity, a life insurance policy or even a bank account can avoid the probate process if they are properly beneficiary designated. Beneficiary designations should be discussed with your estate planning council just to make sure that it’s part of a complete estate plan.
A healthcare proxy is an advanced directive where you’re appointing someone else to make medical decisions for you, if you’re unable to do so on your own. In most cases, for end of life decision making, in a nutshell to pull the plug, in the event you’re beyond the point of no return, you don’t want to be on life support systems, you do need that healthcare proxy to authorize someone to make that decision for you.Your beneficiary designations have the benefit of avoiding probate so any assets that have a beneficiary designation, an annuity, a life insurance policy or even a bank account can avoid the probate process if they are properly beneficiary designated. Beneficiary designations should be discussed with your estate planning council just to make sure that it’s part of a complete estate plan.
If you don’t have a will or a trust, the laws of intestate succession are going to determine who gets your assets. There’s a pecking order. If you have a spouse, it usually goes to the spouse. If you have children, it could drop down to children. The problem of not having a will or a trust is you don’t dictate the terms. Sometimes children inherit assets before you want them to, and certainly in today’s age with blended families, there could be a lot of issues if you don’t plan properly.
A power of attorney is a financial document, so it’s important to choose wisely which powers you’re going to grant to your agent. In New York, the general durable power of attorney you can transfer real estate, stocks, bonds, personal property, handle financial matters and more. Gifting, depending on how much authority you want to grant your agent. This is a very important financial document and we emphasize that the power in power of attorney is a lot to give and we think that it should only be signed upon the advice of counsel.
When you have a special needs child and you leave them an outright inheritance, that can knock them off any government benefits they may be receiving. The planning you should do is a third party supplemental needs trust, which allows you to supplement any benefits that the child is receiving, and if they die at any point before exhausting those funds, those funds could go to your other children.
If you don’t have a will or a trust, the laws of intestate succession are going to determine who gets your assets. There’s a pecking order. If you have a spouse, it usually goes to the spouse. If you have children, it could drop down to children. The problem of not having a will or a trust is you don’t dictate the terms. Sometimes children inherit assets before you want them to, and certainly in today’s age with blended families, there could be a lot of issues if you don’t plan properly.
An executor is a person appointed by you in your will to gather your assets. We call it marshaling your assets and then distributing them out. The executor is a fiduciary, which means that they have a high duty of care and they’re held to a higher standard with respect to your assets than they are to even their own assets. An executor typically works with an attorney to probate your will and to make sure that at the end of the day your assets are distributed.
Probate is the process or proving the validity of a will. Basically, what we’re looking to see is did the testator, the person who created the will, have capacity. Were they of sound and disposing mind at the time that they made their will and was it validly executed? Once that’s done and probate is approved, then your executor has the legal authority to act on behalf of the estate.
Most buyers or sellers choose their attorney based on a recommendation from a real estate agent. The attorney should really have a lot of experience handling real estate transactions, and obviously you’d rather have an attorney who’s handled thousands of transactions over many years than someone who is a litigation attorney who is just doing that as a favor to you. The real estate agent is probably your best person for a recommendation.
An offer is pretty much a handshake. When a seller accepts an offer from the buyer you’re at the handshake stage at that point. It used to mean a lot more than it does today. After you have that offer it’s important to get into contract pretty quickly because without a fully signed contract on both sides the seller can always take another offer if someone steps in and offers more money. So it’s good to make sure everything’s in a row, you have your attorney lined up, and get the contract as quick as possible.
In New York, the property disclosure statements are very rare. The alternative is the seller provides a $500 credit at closing, and most New York attorneys are going to recommend that the seller just provide the $500 credit. The theory being if you make representations and something happens a couple of days after the closing, you’d be subject to a lawsuit for fraudulent representations. In most cases, you’re just going to give the $500 credit.
Sometimes it’s beneficial to allow a seller to remain in possession after a closing. We routinely do that. We use something called a use in occupancy agreement, which kind of outlines the terms for that periodic stay. It’s often useful if you have a mortgage commitment that is expiring, or a rate lock that’s expiring, you want to close, but the sellers aren’t ready to move. So a post closing occupancy is definitely something that could come in handy.
Sometimes it’s beneficial to allow a seller to remain in possession after a closing. We routinely do that. We use something called a use in occupancy agreement, which kind of outlines the terms for that periodic stay. It’s often useful if you have a mortgage commitment that is expiring, or a rate lock that’s expiring, you want to close, but the sellers aren’t ready to move. So a post closing occupancy is definitely something that could come in handy.
You have spent years building security for your family. The final step is making sure that security transfers smoothly and fairly under New York law.
Whether you are planning ahead, protecting assets from long-term care costs, or helping a loved one through probate, guardianship, or estate administration, Meyer & Spencer PC is here to guide you with clarity and confidence.
Schedule your initial meeting today and take the first step toward a plan that is fully implemented and built to last.
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