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3858 Carson St., Suite 120
Torrance, CA 90503
Tel: (424) 247-9381
Fax: (310) 356-3149
E-mail: Laura L. Thatcher

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Laura Thatcher - Manhattan Beach, California - Attorney

April is Financial Literacy Month

Is it Time to Review Your Estate Plan?

If you already have your estate plan in place, this is a good time to review your plan to make sure it is current?  Have there been any big changes in your life?  A marriage, divorce, birth or death?  If so, it’s definitely time to update your estate plan.  If there haven’t been any big changes, it is always good to make sure you still agree with the decisions that you made when you originally created your plan.

If you don’t already have a plan, there is no better time than now to create one!

What is an estate plan?

At its most basic, your “estate” includes the things that you own and the things that you owe.  Your “estate plan” is what you want to happen to those things in the event of your death or incapacity.

I like my clients to think of their estate plan as a map of how to take care of the big things in their lives.  These things are:

  • Family
    • who will take care of your children (guardians)
    • what money will your family live on? (life insurance)/
  • House
  • Retirement Assets (401(k), IRA, etc.)
  • Finances (bank accounts, bills, etc.)
  • Health Care

By working with an estate planning attorney, you can ensure that these “big things” in your life are coordinated and you have systems in place to make sure that in the event of a major issue (illness or death) the big things in your life transition with as little hassle as possible.

 

Daylight Saving Time Facts

It’s March already!  Spring is almost here.  One of the springtime rituals is setting our clocks forward, or “Spring Forward” as we enter Daylight Savings time.  This year it is scheduled to begin at 2 a.m. on Sunday March 9.  Remember to set your clocks forward!

In anticipation of the longer spring days, here are 10 “fun facts” about Daylight Saving Time.

 

1.   Officially, it’s “daylight saving time,” not “daylight savings time.” But don’t feel bad if you thought there was a final “s” on “saving”; far more people Google the incorrect phrase than the correct one.

2.   Daylight saving time has mixed effects on people’s health. Transitions into and out of DST can disturb people’s sleeping patterns, for example, and make them more restless at night. Night owls tend to be more bothered by the time changes than people who like mornings, Finnish researchers concluded in 2008.

3.   There’s a spike in heart attacks during the first week of daylight saving time, according to another study published in 2008. The loss of an hour’s sleep may make people more susceptible to an attack, some experts say. When daylight saving time ends in the fall, heart attacks briefly become less frequent than usual.

4.   People are safer drivers during daylight hours, and researchers have found that DST reduces lethal car crashes and pedestrian strikes. In fact, a study concluded that observing DST year-round would annually prevent about 195 deaths of motor vehicle occupants and about 171 pedestrian fatalities.

5.    Many fire departments encourage people to change the batteries in their smoke detectors when they change their clocks because Daylight Saving Time provides a convenient reminder. “A working smoke detector more than doubles a person’s chances of surviving a home fire,” says William McNabb of the Troy Fire Department in Michigan. More than 90 percent of homes in the United States have smoke detectors, but one-third are estimated to have dead or missing batteries.

6.    While twins born at 11:55 p.m. and 12:05 a.m. may have different birthdays, Daylight Saving Time can change birth order — on paper, anyway. During the time change in the fall, one baby could be born at 1:55 a.m. and the sibling born ten minutes later, at 1:05 a.m. In the spring, there is a gap when no babies are born at all: from 2:00 a.m. to 3:00 a.m.

7.    The idea of daylight saving was first conceived by Benjamin Franklin (portrait at right) during his sojourn as an Americandelegate in Paris in 1784, in an essay, “An Economical Project.”  Although Franklin’s proposal was that people change their sleep schedules, not the clocks.  The modern concept of Daylight Saving Time was proposed by Englishman William Willett in a 1907 brochure “The Waste of Daylight.”

8.    On April 30, 1916, Germany was the first county to implement daylight saving time to conserve electricity during World War I.  The United Kingdom followed suit and introduced “summer time” several weeks later.  The United States adopted Daylight Saving Time on March 31, 1918.

9.    After the World Wars, states and localities could start and end daylight saving whenever they pleased, a system that Time magazine (an aptly named source) described in 1963 as “a chaos of clocks.” In 1965 there were 23 different pairs of start and end dates in Iowa alone, and St. Paul, Minnesota, even began daylight saving two weeks before its twin city, Minneapolis. Passengers on a 35-mile bus ride from Steubenville, Ohio, to Moundsville, West Virginia, passed through seven time changes.  Order finally came in 1966 with the enactment of the Uniform Time Act, which standardized daylight saving time from the last Sunday in April to the last Sunday in October, although states had the option of remaining on standard time year-round.

10.   Arizona and Hawaii don’t recognize Daylight Saving Time

 

Living Trust Infographic

Like many people, I am a visual learner.  That is why, during my meetings with estate planning clients, I always draw out a sketch of the different types of assets my clients may own and how they work with a living trust.  If find that the graphic representation really helps clients “see” the types of assets are held in their living trust (which I refer to a a “treasure chest” or “toy box”).  The sketch I make during our meetings is very rough (made even more so by the fact that I am writing upside down).  Here is an infographic version of that sketch:

 

When Should I Start an Estate Plan?

I was recently asked the question, “How old should I be when I start my estate planning?”  It’s a great question, and the answer surprised her:  Estate planning should begin as soon as someone legally becomes an adult (18 years old).

At 18, you don’t need complicated estate planning, but there are several documents that all adults ought to have.  You have likely heard of the Health Insurance Portability and Accountability Act (HIPAA).  This Federal law (and its California equivalent) made it illegal for health care providers to share medical information with someone other than the patient without specific authorization.  Similarly, an adult’s financial information also is protected from disclosure.  These privacy laws are great, but what if you (or your adult child) are unable to make medical or financial decisions?

These three documents allow an adult to designate someone to make medical and financial decisions for them:

Advance Health Care Directive

An Advance Health Care Directive is a document that names an agent who is responsible to make health care decisions for you.  There are several different versions, but at the Thatcher Law Group, we use a form that allows you to also make important end of life decisions as well.

Durable General Power of Attorney

A durable General Power of Attorney allows an individual to name an agent to make financial decisions on your behalf in the event you are unable.  Each specific type of financial decision is identified separately.  This document can either last indefinitely (“durable”) or it can be given an expiration date.

HIPAA Disclosure Authorization

This document provides specific written authorization for medical health care professionals to release your medical information to the person you have designated.

A young adult may also consider writing a will.   If a young adult has little or no assets, no children of their own, and wants their possessions to go to their parents, California’s laws of intestacy will likely cover their needs.  If your situation is more complicated than that, then a written will or trust may be appropriate.

If you have any questions, or want to begin the estate planning process, please contact the Thatcher Law Group to schedule a complimentary initial consultation.

 

Top Excuses For Putting Off Estate Planning

We are now a week into 2014.  Did you make a resolution to take better care of yourself?  One of the best ways to take care of ourselves is to reduce or eliminate stress from our lives. Having a plan in place for who will help you in a crisis is a great way to reduce your stress.

In my opinion, every adult should have an estate plan in place. However, many people that I talk to do not have theirs in place yet. I have heard many excuses for why they haven’t yet put a plan into place. Some of the more common ones follow:

“It’s too expensive.

Preparing an effective estate plan is not cheap.  It is, however, much less expensive than not having a plan in place.  If you have no plan in place, probate fees are based on a percentage of the gross value of your estate (in other words, your debts do not reduce the amount to be paid).  Many law firms will accept payment plans to ease the cost of an estate plan as well.

“Seeing a lawyer is intimidating.”

Lawyers can be intimidating. Plus, as a profession, lawyers do not have the greatest reputation.

Many people also think that the process of preparing an estate plan is complicated. To the contrary, the process can be quite simple. The process frequently begins with a questionnaire (which includes biographical and financial information).

Clients then meet with an attorney for about an hour or two to discuss goals and potential solutions. A short time later, clients will have the opportunity to review drafts, and then will meet with the attorney again to sign the documents.

“I’m not sure who to appoint.”

The choice of whom to appoint to raise your children, make financial decisions or make health care decisions can be one of the largest stumbling blocks in making the first appointment to see an Estate Planning Attorney. In fact, my own husband delayed finalizing our estate plan for this very reason.

What I told him (and my clients) is that someone is better than no one. Get something down. If you think of someone better later, you can always revise your documents. If you are really stumped, discuss your options with family, friends, your pastor or your attorney.

“I’m too young.”

Accidents can happen at any time.  Enough said.

“I don’t have enough time.”

The process of preparing your Estate Planning documents is simple and fairly streamlined. I have put together an entire estate plan at one dinner party (though I don’t recommend it, and would prefer not to do that again).

“I don’t have an ‘estate’.”

Estate plans include much more than just your assets. A revocable trust and/or Last Will and Testament (which relate to your assets) are only two of the documents that make up a complete estate plan. Other very important documents include an Advance Health Care Directive, and a General Durable Power of Attorney. These documents allow you to appoint someone that you trust to make financial decisions and healthcare decisions for you if you are incapacitated or injured and cannot make your own decisions (either temporarily or permanently).

“I don’t want to die.”

Someone once said, “Talking about babies won’t make you pregnant, and talking about death won’t make you dead.”

You cannot prevent your death, but you can ease your loved ones grief by having a plan in place.

If you are ready to begin the process of putting your estate plan in place (and you live in California) contact The Thatcher Law Group to schedule a complementary initial consultation.  Or, feel free to ask questions in the comments.

Wishing you peace.

IRA Inheritance Trust®


Tax deferred accounts such as IRAs and 401(k) often make up the bulk of our retirement planning. Unfortunately, the rules governing distribution to beneficiaries are complicated and our beneficiaries can sometime be stuck with unintended tax burdens when they “inherit” an IRA (or other tax deferred retirement account).

An IRA Inheritance Trust® can be used to maximize the retirement benefits received by your loved ones (beneficiaries) and protect the funds from creditors, poor financial management and even divorce!

What does An IRA Inheritance Trust® do?

The IRA Inheritance Trust® is a stand alone (separate) document from your existing Revocable “Living” Trust.  It can be modified during your lifetime to reflect your beneficiaries needs, but upon your death it become irrevocable.  This tool allows your beneficiary to take advantage of the “stretch-out” benefits of your IRA – in other words, a properly structured IRA Trust can allow your retirement accounts to grow exponentially (while remaining tax deferred).  A $250,000 IRA account can grow to $10 million or significantly more (depending on the age of the designated beneficiaries)!

In my opinion, however, one of the most important benefits of an IRA Inheritance Trust® is the ability to protect the assets for your loved ones.   It can be especially useful in these situations:

  • Your beneficiary is now or may become disabled and you want to ensure their ability to receive governmental benefits
  • You are concerned about your beneficiary’s ability to manage their money
  • You want to protect your beneficiary from creditors
  • You want to ensure that the inherited IRA benefits are not available to a divorcing spouse

Is An IRA Inheritance Trust® Right for YOU?

  • Is the combined value of your retirement accounts (including 401(k), Roth IRA, Sep IRA and other tax-deferred plans) for both you and your spouse (or significant other) at least $200,000?
  • Are you concerned about protecting the finances for one or more of your designated beneficiaries?

If your answer to either of these questions is yes, then an IRA Inheritance Trust® may be right for you.

To learn more about an IRA Inheritance Trust®, contact The Thatcher Law Group!

Wishing you peace.

 

Wenceslas’ Words — A Christmas Tuesday Twister

Good King Wenceslas looked out,

On the Feast of Stephen,

When the snow lay round about,

Deep and crisp and even;

Brightly shone the moon that night,

Though the frost was cruel

When a poor man came in sight,

Stamping out a message:

Suddenly the snow began to fall heavily and the first letter N soon disappeared, leaving the word SOWING.

King Wenceslas rubbed out another letter of the word in the snow and it again left a word. He carried on taking out one letter at a time, leaving other, smaller words. He did this until there was only one letter left – and this was a word too!

Which words did King Wenceslas make and what was his final word?

 

Giving Tuesday

Today is the second annual Giving Tuesday.   The idea is that after spending our money on stuff on Black Friday, Small Business Saturday and Cyber Monday, we take a day to give back.

This year, I read the book The Power of Half by Kevin and Hannah Salwen.  It really changed my thinking on charitable giving.  The book describes one family’s choice to sell their “show place” Atlanta home and move to one that was half the size.  They chose to donate half of the proceeds of the sale of their large house (approximately $800,000) to fighting hunger in Africa.  The book’s authors (Kevin Salwen and his then 15 year old daughter, Hannah) write about their experience in a way that is not at all preachy or “holier than thou”.  While they suggest that everyone try to give half, they by no means expect others to sell their homes.  Instead, the authors suggest that everyone can give up half of the money they spend on coffee, or watch half the amount of TV or video games.

Everyone (no matter what our situation) can give something of either their time, talent or treasure.

This year, two of the charities that I am supporting are Imagine No Malaria (an effort of the United Methodist Church to eradicate malaria – a disease that I was shocked to learn kills one in FIVE children under 5 years old in Africa).  I also support Sandpipers, a philanthropic organization here in the South Bay that focuses on the needs in our local community.

These are just two of the organizations and ways that I have chosen to serve.  But there are countless more opportunities to give and/or serve.  Giving doesn’t need to be in the form of a monetary donation.  Some of the other ways you can give is to volunteer at a soup kitchen or for meals on wheels, or even volunteer with an animal rescue (such as Noah’s Bark).

So today, why don’t you take a break from holiday shopping and take a moment to give to those in need!  You may be surprised to find out how much you receive from the simple act of giving.

 

Why I Think an Estate Plan is a Wonderful Gift

For his birthday this year, I gave my husband a pedometer. At first he was not thrilled with the gift. But I chose it because I love him and I want to keep him around for a long time – so it is in my best interest to keep him healthy. What could be more romantic?

Giving a loved one the gift of an estate plan is a similarly loving gift – whether you are giving it to your adult child (possibly the parent of your grandchildren) or your spouse. The gift of an estate plan tells your loved one that you care about what happens to them.

Why give an Estate Plan as a gift?

• Most people do not want to pick up the phone and schedule an appointment, often because they think that planning for death is scary, difficult or too expensive.

• The Thatcher Law Group’s estate planning process is much more simple than most people think. Preparing Attorney Laura Thatcher makes planning your estate easy and as fun as possible.

• Estate planning is not just for the wealthy. Everyone should have an estate plan, whether you own a home that is heavily mortgaged, only have $100 to your name or nothing but debts, you still need an estate plan. What type of estate plan will vary, but there are many documents that everyone over the age of 18 needs to have.

• With the gift of an estate plan, you remove the biggest hurdle most people have to creating their estate plan: “I cannot afford it right now.”

Estate planning with The Thatcher Law Group is fast, simple and easy to do!  This holiday season, The Thatcher Law Group is offering special discounts on estate planning packages.  This is therefore the perfect time to consider giving an estate plan as a gift for the parents of your grandchildren (also know as your children) or your spouse.  Click on this link for our 2013 Holiday Special!

Contact The Thatcher Law Group to find out if the gift of an Estate Plan is the right thing for you and your loved ones.

Tuesday Twister — A Thanksgiving Riddle

Riddle me this:

Susan has invited her family to Thanksgiving Dinner. When she sets the table many plates will she need? There’ll be a grandfather, a grandmother, two fathers, two mothers, four children, three grandchildren, one brother, two sisters, two sons, two daughters, one father-in-law, one mother-in-law and a daughter-in-law. 

 At least how many plates does Susan need for her Thanksgiving table?

Post your answer in the comments.