In America, we are trained from an early age to plan for our retirement. Many of us start to fund retirement accounts as soon as we start working. While planning for your retirement is undeniably important, over-funding your retirement account can create an estate planning nightmare. Excess funds that are left over from your retirement account when you die could be subject to income tax and estate taxes. As a result, the amount left over could be reduced to a small percentage of its original value. The good news is that with proper estate planning, you can both adequately plan for your retirement and protect any excess from being lost to income and/or estate taxes.

Although experts voice opinions on a regular basis regarding how much money we will all need in order to sustain our lifestyle after retirement, the reality is that there really is no way to know how much money we will actually use after we reach retirement age. You have no way of knowing how long you will live or what your health care costs will be throughout your golden years. As a result, most people plan for the worst and hope for the best. This frequently leads to a significant excess of retirement funds upon death. If you have done nothing to prepare for this contingency, those funds could be taxed as income and then taxed again as part of your estate, resulting in the loss of well over half of the funds left.

By taking advantage of the numerous estate planning tools that are available to you, you should be able to create an estate plan that continues to allow you control over the assets while you are alive, yet protects them from over-taxation in the event you have over-funded your retirement account.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

Unfortunately, first marriages in the United States are  statistically likely to end in divorce. Most of those divorces then result in a re-marriage at some point in time. If you are one of the millions of people who is planning to remarry, you are probably spending a considerable amount of time trying to ensure that your blended family will be a success. One consideration is how to handle your finances once you are married. Along with creating a plan for handling everyday finances, be sure to talk to your future spouse about how plan to handle your estate plans once you are married.

There is no “right” or “wrong” way to handle your estate plans once remarried. There are, however, some things that you may wish to consider and discuss with your estate planning attorney.

Inheritance money and personal family heirlooms may be best kept separate. By titling accounts or property jointly, you may be creating marital property that can be more complicated to untangle upon your death.

Other assets, however, may benefit from being titled jointly or converted to a “pay on death” account. By doing this, you are providing your future spouse with instant access to the assets upon your death instead of requiring the assets to go through the often lengthy probate process. If you are concerned that your spouse may need the assets to care for himself or herself, or to care for any future children the two of you may have, then jointly held assets may be the best way to go for estate planning purposes.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

As news of the death of singer and actress Whitney Houston hit the airwaves, sales of her work began to soar. Houston was discovered dead in her Beverly Hills Hilton hotel room just hours before she was scheduled to attend the Grammy Awards. Once considered the darling of the music industry because of her soulful voice and endearing personal style, Houston was best known for the timeless hit I Will Always Love You. Along with a string of chart topping number one hits throughout the 90s, Houston also managed to accomplish the often difficult task of crossing over into the acting arena with successful roles in movies like The Bodyguard and Waiting to Exhale. Sadly, despite her professional success, the last decade of Houston’s life was marked by personal troubles.. The value of Houston’s estate will be determined by the date of her death for probate purposes; however, her beneficiaries will enjoy the benefits of soaring sales that have followed the news of her death.

You may not have a lucrative record deal or movie role residuals to count among your estate assets, but you likely do have estate assets that are likely to increase in value. You may also have assets that may continue to provide an income stream for your estate beneficiaries long after your death. Assets such as these require additional consideration when planning your estate in order to ensure that they are handled correctly and are left to the appropriate beneficiary.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

Whether you are still formulating your estate plan or have finished it, you may now be wondering with whom you should share the details. Unfortunately, there is no easy answer to this question. Only you can decide whether to share any, or all of the details of your estate plan; however, your decision may depend, to a large extent, on who the person is with whom you are considering sharing the details.

• Beneficiaries: There is rarely a real need to divulge the details of your estate plan to beneficiaries, but some people choose to do so anyway for personal reasons. You may simply wish everyone to know what to expect. On the other hand, the details may not make all beneficiaries happy in which case keeping the details to yourself may prevent disharmony.
• Spouse or Partner: Some couples choose to make reciprocal Wills and work together on estate plans. This works best when there are numerous jointly held assets or children in common. If, however, you have chosen to keep your money and assets separate and do not have children in common, then there may be no practical reason to share the details of your estate plan.
• Guardian/Trustee/Executor: Positions such as these within your estate plan require the appointee to accept a significant amount of responsibility. For this reason, it is best to discuss your plans with the intended appointee prior to actually including them in your estate plan in the event the individual has any reservations.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

When you sit down in Atlanta to do your retirement plan, make sure you take your estate plan into consideration, and vice versa. Likewise, if you make significant changes to your estate plan, make sure you make the corresponding changes to your retirement plan as well and vice versa.

In order to understand why the two go hand in hand, consider the subject matter of each — your money and assets. Your retirement plan is based on assets and money that you plan to life off of when you reach retirement age. Your estate plan is a plan that proposes to dispose of all assets that you own at the time of your death. Assets that are marked for use in your retirement plan may, or may not, be available to pass down to family members or loved ones upon your death. On the other hand, assets that you place in a trust as part of an estate plan may not be available to be used during your retirement. As a result, careful consideration should be given to both your estate plan and retirement plan when creating either one.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

If you love your pet as you love your children, spouse or parents, then you likely wish to provide for him or her in the event of your death. From a Henry County estate planning attorneys perspective, one of the easiest ways to do that is to create a pet trust. A pet trust is relatively easy to create and offers numerous benefits that can help put your mind at ease with regard to your pet’s care in the event of your death.

A pet trust operates the same as any trust, except that the beneficiary is an animal, not a human. Because of this, you will also need to arrange for someone to have the physical, day to day, care of your pet after your death. By creating a pet trust, however, you can ensure that the person who cares for your pet will have the financial means to do so. In addition, you can designate a neutral person as trustee to ensure that the trust funds are used for the benefit of your pet.

Creating a pet trust can also offer tax advantages that simply leaving money to someone in your will does not offer. Finally, a trust also offers the potential for asset growth. By funding a trust now, the trust assets can begin to grow immediately. In the event you outlive your pet, or the trust assets perform especially well, you can designate a remainder beneficiary to receive the trust funds.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

Today, remarriage as a result of divorce or the death of a former spouse is considerably more common than it was a few decades ago. Consequently, blended families have become the norm in the United States, instead of the exception to the rule. A blended family comes with a number of challenges, both emotional and financial. If you are part of a blended family, do not overlook the importance of creating an estate plan that takes this into account.

Attempting to create a harmonious blended family can be difficult even when everyone is in favor of the new family makeup. Creating an estate plan can likewise be complicated even without the added considerations that come with a blended family. Trying to develop an estate plan that adequately covers all the issues involved in a blended family without creating discord among the members of the family can seem impossible; however, it can be done and should be done as soon as possible.

Leaving your estate to be handled by the courts upon your death can create considerably more discord and confusion than dealing with the often touchy subject of estate planning while you are alive. If you fail to create an estate plan, state and federal laws will determine what happens to your assets. This could result in a situation where your ex-spouse receives your retirement benefits or your step-children receive nothing despite an agreement with your current spouse to the contrary. In addition, without a Last Will and Testament, at a bare minimum, your estate may be tied up in a probate court for months, or even years, before anyone receives anything. In order to protect your loved ones in the event of your death, take the time now to meet with your Henry County estate planning attorney to make the tough decisions required to create your estate plan.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

When planning your estate, one of your concerns may be how to avoid probate. If you are unprepared, probate can hold up your assets for months, or even years, leaving your loved ones without much needed funds. One tool that may be used when planning your estate is a “pay on death” account.

At your death, probate assets are frequently put on “hold” until a probate court authorizes their release to beneficiaries or heirs. A way to avoid this delay is by converting accounts to “pay on death” accounts.

A “pay on death” account accomplishes precisely what the name implies. When you die, the account is paid out to the beneficiary designated by you when you converted the account. Because the account has been converted to a “pay on death” account, the assets are not required to be included in your estate for probate purposes. However, by avoiding the probate process you also lose the benefits drafted into your estate plan for your beneficiaries. As such, consult with your Atlanta estate planning attorney before using a “pay on death” account and don’t rely on such accounts in lieu of an estate plan.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

 If you are one of the millions of Americans who consider your pet to be part of your family, will you likely wish to include him or her in your estate planning. Just as you make plans for who will take care of your children in the event of a tragedy, you can also make provisions for who will care for your pet as well as how that care will be funded. Creating a pet trust is a legal option which will allow you to know that your pet is well taken care of for his or her natural lifetime.

A pet trust requires you to appoint a trustee to take care of the administration of the trust. Your may or may not be the same person who has the day to day care of your pet. For example, you may feel more comfortable with your attorney or your bank handling the money aspects of the trust, but want a family member to care for your pet, then you may choose to set up your trust accordingly.

You are also required to fund your pet trust. How much money or assets you decide to place in the trust is your decision. Consider the life expectancy of your pet as well as the cost of keeping your pet in the style to which he or she is accustomed to living. Also take into account the fact that your pet will age and likely need additional care and medical treatment as he or she ages.

The terms of your trust can be as flexible or as specific as you decide. The funds will be distributed to the caregiver according to your instructions. You can choose, for example, to distribute the funds on a monthly or yearly basis with a provision that additional funds can be accessed for emergencies or extraordinary medical treatment. Talk to your estate planning attorney for specific details.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.

When a decedent dies, the assets of the decedent’s estate are often held up in a lengthy, and costly, legal procedure known as “probate”. If you have suffered the loss of a loved one, you should take the time to inquire regarding alternative options to formal probate. While state laws and procedures differ somewhat, most states offer some type of informal probate which, under certain circumstances, can drastically reduce the time and cost of the probate process.

Although the names may vary, most states refer to the less formal probate options as “small estate administration” or “small estate affidavit”. The degree to which these options lessen the cost and time factor involved in formal probate will also vary; however, in all cases they are worth investigating if you think your loved one’s estate may qualify.

Qualifying for small estate administration is often based on the value of the estate, type of assets owned by the estate and whether or not the decedent left a valid will. Almost universally, when a decedent dies without leaving a valid will, or intestate, small estate administration is not an option. The reason for this is that a court must make a legal determination regarding who the heirs to the estate are, which requires a more formal administration.

If the estate is valued under a certain dollar amount and the assets are not complex, small estate administration may be available. Small estate administration procedures will also vary, but frequently allow a personal representative to attest to the value of the estate without the need for formal valuations and appraisals. If all the beneficiaries agree to the listed assets and their value, a court will approve the distribution in considerably less time than a formal probate administration. Some states also allow an even simpler small estate affidavit which allows an asset, such as a vehicle, to be transferred by virtue of completing and filing one simple affidavit with the court.

If you believe that your loved one’s estate may qualify for a small estate administration alternative to formal probate, consult with your estate planning attorney as soon as possible.

Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.