Food for Thought Archive

It's Never Too Early to Plan Ahead by Phil Runyon

4/24/2019

It's Never Too Early to Plan Ahead

It occurred to me that most of what I say in these pieces is directed toward my contemporaries rather than our children and grandchildren. The former are certainly the prime consumers of estate planning, but young people and their families are at risk if they figure they can wait another 30 years to bother with it.

For starters, whether they're single or married people, without some planning they don't have anyone who's legally in a position to help out if something befalls them unexpectedly. If they get injured while riding a mountain bike or catch mono at college, they may expect their parents (if they're single) or their young spouse (if married) to jump in and deal with the situation. The trouble is, if they're at least 18, they're adults in the eyes of the law and not even their closest family members can act for them without official papers. Those could be guardianship appointments from the probate court - a cumbersome and expensive option to be avoided - or designations as health care agents in an advance directive and as financial agents under a durable power of attorney. There was a reason their parents executed those documents and the same reason applies to the younger generation, even though the reason may be an accident rather than a stroke or dementia.

Another reason for some Gen Y or Millennial planning is that without a will, the State will decide who receives their Google stock options - and their kids - because a will is where those designations would be made. If they're single, the law says it's parents first, then siblings, but it certainly wouldn't be a live-in partner or close friend or a worthy cause they wanted to support. If they're married, the spouse would get it all if there are no children, but if children are in the mix, they would get a share of everything and then at 18 would be entitled to spend it on whatever is most important to a person that age - probably not growth-oriented mutual funds.

In order to prevent that likely spending spree, young parents should probably consider the same kind of trust their parents have. It would keep their kids from receiving anything outright at 18 and provide for the funds to be held and used for the children until, say, they get through school and have learned a little more about growth-oriented mutual funds.

Although young parents may say, "Why bother with all that planning when we can barely pay for Netflix?", they're probably worth more than they think. They may have IRA's or 401k's that they can't touch now but would be a nice nest egg for the children, and they may have group life policies provided by their employers. Even if they don't have much of that, though, they could likely qualify for low-cost term life insurance that would be payable to the family trust and provide enough for care of the kids by the designated guardian and still leave some funds for college or any other worthwhile pursuit.

So the takeaway here is that planning isn't just for coupon-clipping Baby Boomers. It's also for Gens and Mills of all designations - and whatever the next generation will be called!

Posted 04/24/2019 Estate Planning

Gist and Estate Taxes Untangled by Phil Runyon

2/28/2019

Gift and Estate Taxes Untangled

This time I want to shed some sunlight on how gift and estate taxes work. I spend a lot of time dispelling rumors about them that have persisted since Warren Buffet made his first billion, so let's try to clear up some misconceptions.

The first thing to keep in mind is that we're talking only about federal taxes here. New Hampshire has no gift or estate taxes at all, even if you really are Buffet-rich. This State gets you in other ways, particularly if you own real estate, but it leaves gift and estate taxation to the feds.

And the thing to remember about federal gift and estate taxes is that they're closely intertwined. The way it works is that each of us currently has an "exemption" of $11,400,000 for lifetime gifts and/or date-of-death-transfers that can pass totally tax-free - that number's not a typo. So a married couple actually has $22,800,000 to work with. That may be just a drop in the buffet for Warren, but it will keep most of us from having to worry much about even federal taxes.

As if that wasn't enough, there's also the annual gift tax "exclusion" that allows each of us to make a yearly gift of up to $15,000 in value to each and every other person we choose, totally without tax consequences of any kind. And if we're married, we can double up on those exclusions, even if only one of us actually makes the gift.

So let's put all this together to see how the taxes dovetail. Let's say we make a gift of $50,000 to one of our children this year. That qualifies for the $15,000 annual exclusion and because we're married, we can count $30,000 as qualifying for it. The remaining $20,000 is then deducted from our lifetime exemption of $11,400,000, so there's no tax due, but now we're all the way down to $11,380,000 to apply to other gifts during lifetime - or to use against the value of our assets at death.

Then, if we die having $1,000,000 of estate assets and having made no other lifetime gifts above the annual exclusions, our estates will use up another $1,000,000 of our exemption and there will be $10,380,000 left that can be added to the exemption amount our spouse will have available at his/her death.

One caveat, though, is that if an annual gift exceeds the exclusion amount, we do have to file a gift tax return - not because there's any tax due but because the IRS wants to keep track of the amount of lifetime exemption we've used up.

And there's still one more goody. If we contribute to our children's or grandchildren's school tuitions or uninsured medical expenses (or anyone else's, for that matter), those payments, whatever the amounts, don't even count toward our annual exclusion gifts. We just have to be sure to make the payments directly to the school or medical provider.

Oh, sure, there are a few twists and turns about what I've said - after all, the tax code makes the Manhattan phone book look like a pamphlet - but if you've hung in here this long, you've got the big picture. The main takeaway is that most of us can be as generous with our needy children and grandchildren as we can afford to be, even if that benevolence far exceeds the annual $15,000 exclusions.

posted 02/28/2019

Know Your Family Responsibilities by Phil Runyon

7/31/2018

Know Your Family Responsibilities

This time I thought you might like to know a little about what you're getting into when you sign a hospital or nursing home form to admit a parent, spouse or child to a health care facility that will likely want to be paid at some point.

Let's take the child's situation first, because that's the easiest one. If the child is a minor (under 18 years of age), you're definitely going to be held responsible for the obligations related to the child's care. With authority over the child comes responsibility for the child.

So what about your spouse's bills? Using the ancient doctrine of "necessaries", the New Hampshire Supreme Court has pretty recently confirmed that based on the marriage contract, "both husbands and wives must pay for debts for the basic necessities of the other spouse if the spouse is unable to pay her or his bills, including medical, hospital and nursing home bills." Apparently, those wedding vows about "in sickness and in health" are more than old-fashioned window dressing, at least in New Hampshire. And that's consistent with the Medicaid requirement that both spouses' assets get lumped together to determine the amount that needs to be "spent down" before either one of them can qualify for government assistance with nursing home bills.

Now don't get me wrong. I'm not advocating for what used to be called "living in sin", but there's definitely an advantage for unmarried partners when it comes to liability for medical and nursing home bills. That "unaffiliated" status, shall we say, would also keep the assets of the healthy partner from being dragged into the calculations of the nursing home partner's eligibility for Medicaid. That may not be much of a consideration for young people still in child-bearing mode, but it's often a serious issue when more senior singles are deciding whether to tie the knot. Often, too, that knot is a second one - which is why the children from a prior marriage frequently have strong views on the subject of exposing their inheritance to the nursing home expenses of a new spouse. And unfortunately, even a pre-nuptial agreement, which is a good idea for protecting the children's inheritance from the new spouse's claims, won't keep those assets from being claimed to pay his or her nursing home expenses.

OK, then what about a child's responsibility for the medical and nursing home expenses of a parent? That's called "filial responsibility" in legal jargon, and it's been a murky area in many states. Fortunately this time, in New Hampshire there's new law that eliminates that potential responsibility - but be careful. If a child misuses the parent's assets, so they're not available to pay the bills, or if the child fails to apply for Medicaid benefits once the parent runs out of money, the child can still be held responsible for negligent management of the situation.

Be careful, too, about those forms you're asked to sign when checking a parent into a care facility. They often say you're signing as the "responsible party", but what does that really mean? Are you just agreeing to be the contact person in the event of emergency, or are you committing to be responsible for payment of the bills if mom's or dad's funds run dry? It's really important to inquire about that - and then to get the clarification in writing - so you'll have something tangible to pull out when the bills start arriving with your name on them.

By the way, the new law I mentioned also relieves parents from liability for the medical bills of their adult children (18 and older), subject to the same requirements of reasonable care I described above if you're handling the finances for a son or daughter who may still be in school, for example.

The bottom line is that paying your own medical bills - even what's left after insurance does its part - is challenging enough. If we can also help with other family members' bills, that's going to be a tremendous relief to them, but having it be a voluntary decision instead of a legal obligation would make it a lot better.

A Modest Proposal by Phil Runyon

3/15/2018

A Modest Proposal

Many of you have already taken the suggestion to convey your assets to revocable trusts to help your family avoid the winter (spring, summer and fall) of discontent that is probate administration. Often the plan is to hold the nest egg in trust until you’ve shoveled your last driveway, and then to distribute it in equal shares among the kids once they’ve reached responsible ages.

The problem with this plan can be that age alone doesn’t guaranty smooth sailing for anyone. For example, what if you’ve settled on a final payout at 30, but by then a divorce or a lawsuit or bankruptcy has made it treacherous for your offspring to receive - and retain - even a morsel of the egg? Yet the trust says 30, so the estranged spouse or the plaintiff or the bankruptcy creditors want their shares. Or what if 30 just turns out to be way too early - or unnecessarily late - for your folks, no matter how you assessed the situation way back when they were 10 and 12?

Let's also say you want the trust to provide for the children's or grandchildren's tuition somewhere really expensive - that doesn't narrow it down much these days - but you don't want the trust assets to count against them in the financial aid decisions. Or perhaps one of those youngsters ends up spending every nickel he touches on harmful substances or needs disability benefits at some point - and you don't want a trust share to finance their problems or disqualify them from help they may be able to qualify for otherwise.

How about one more scenario: maybe one of the kids or grandkids doesn't really need as much as another, because his spouse has a lucrative career or inherited a lot herself - or maybe needs more, because she's committed to a wonderful non-profit that does important work but can't pay a living wage.

So, what kind of magic tweak might actually deal with nearly all these concerns? Well, suppose you substituted the word "may" for "shall" in the trust provision about distributions, and suppose you took out all the ages for mandatory equal distributions and left it totally up to a trusted person - you know, a trustee - to decide when and for what purposes distributions could be made once you're gone. Then, instead of inserting any specifics into the trust agreement itself - specifics that might have to be disclosed to someone snooping into a beneficiary's right to a quantifiable share of the assets - suppose you left some informal guidelines for the trustee about how and under what circumstances the trust funds might be used. And because those guidelines weren't included in the official document and weren't legally enforceable anyhow, they wouldn't have to be disclosed to anyone. No one's share would really be a share at all, so no third parties could get their claws into anything definite or put a meaningful value on it.

Needless to say, this approach isn't for everyone. Some people don't want others - even trusted others - making all those fundamental decisions. Some people don't even have others they trust that much. And some people just figure that their kids need to leave the nest and fend for themselves at some point - say, at 30 - no matter what happens next. So it's just a modest proposal for your consideration.

LTC and TLC Considerations by Phil Runyon

10/12/2017

LTC and TLC Considerations

It turns out that most people aren't as worried about climate change or whether Twitter will go to 280 characters as they are about spending their life savings on years of nursing home expenses. On the other hand, they're nervous about just turning over their assets to the children (for the reasons I've detailed in a prior message), in order to qualify for Medicaid if and when the time comes - but they also don't want to spend up their nest eggs on expensive long-term care insurance they may never need.

What to do then? For one thing, if a couple owns their home and only one of them needs a nursing home, they can likely keep the home, its furnishings and the family car, and none of those assets will be hit with Medicaid liens. They can also keep more than $100,000 of their nest eggs, and the spouse at home can retain all his or her income from Social Security and pensions. In other words, it may be a nor'easter, but it's not hurricane Harvey.

Still, people want to do something to protect themselves, and they're often lured to risky options that get promoted as miracle drugs. They're told they can put their assets in trusts and still have those funds available to pay their personal expenses - so, voila, they'll get the nursing home financed by Medicaid without even a crack in the egg. The trouble is, it's just not that simple, and there will likely be a battle with Medicaid over the terms of the trust or about whether Medicaid can get their benefits reimbursed from the trust funds.

The problem has always been that the other option - long-term care insurance - is almost as bad, because the premiums are high, and if you never need professional nursing care, it seems like you've cracked your egg for nothing. Now, though, even the companies that sell LTC policies have recognized the drawbacks, and they've come up with hybrid policies that guaranty the return of some or all of your premiums at death if you haven't eaten them all up in payments for nursing care. I'm not an insurance expert, but there are good ones in our own backyard and they can help you decide whether these improvements in coverage are enough to tip the scales for you. Just look into the options soon rather than later, though, because the premiums increase as you get older. What a surprise!

Much of what I write about comes from actual situations I've been witnessing, and here are a couple more. If a family member needs someone to handle his or her legal and financial business or to make health care decisions, make sure to have them execute the necessary documents before a physician has declared that the window of opportunity has closed. If a person can no longer make intelligent and knowledgeable decisions, then they can't sign legal documents, and the only recourse is guardianship - an expensive and divisive process. The same goes for will or trust revisions, as I've had several family members recently say that "mom would never have wanted those [old] arrangements any longer," but she never got around to changing them.

Finally, and here's the TLC part, one of the greatest gifts you can give your family is not to leave them with a real mess once you're gone. I'm not talking now about the legal documents, because you may have been scrupulous to keep those in order. I'm referring to what, in fact, you've left behind, where to find it all, and what to do with it once the family discovers your secret hiding places. You may have a shoe box full of krugerrands or all the vintage baseball cards your mom never threw out, but where are they and what are your thoughts about what to do with them? We've even had to re-open estates when unknown assets surfaced years later in the back of a desk drawer.

Likewise, does anyone in the next generation have any idea where you came from and what you did before they came along? And do they know who your college roommate, second cousin or Army buddy was and how to contact them once you're gone? This isn't the kind of information to fill up the documents with (even though we don't actually get paid by the word), but that doesn't mean it's not just as important. If you need prompting about these and other topics you might cover, please let us know and we'll forward a form that could help.

Posted 10/12/2017 - Misc.

EnABLEd Accounts by Phil Runyon

7/11/2017

EnABLEd Accounts

We've probably all at least heard about so-called "special needs trusts", even if we've never met one in person. They're intended to provide supplemental assistance for people receiving - or who may be eligible to receive - those special public benefits. They're also usually long and complicated, because there are lots of rules limiting what the trust funds can be used for without upsetting the public benefit apple cart. Enter the recently-enacted ABLE account, which is short for Achieving a Better Life Experience, and which, under the right circumstances, can be much more user-friendly than a tedious and restrictive special needs trust. Here's how:

Let's say a young person with special needs has had a Uniform Transfers to Minors Act account that was set up by a caring parent or grandparent. If she applies for public benefits after turning 21 (when UTMAs must pay out), those funds will be counted against her in the application process. If instead those UTMA funds are transferred to an ABLE account before she turns 21, the government authority will be unABLE to count those funds against her in determining her benefits.

OK, but how does an ABLE account work, and who's in charge of it? That's the beauty part, as they say, because instead of having to work through an independent trustee for every expenditure, the young person can be in charge of the account and can determine the use of his funds. That may not work for everyone with special needs, but in the right case it can be extremely empowering and can help build a vulnerable person's self-esteem. The enABLEd person can also use the account to save up for important purposes like buying a home or getting married.

Another ABLE advantage is that the account can be used for the person's own household and living expenses, which would likely be disqualifying expenditures for public assistance purposes if those payments were made from a special needs trust. Again, if a person with such an account can pay her own way, so to speak, that can result in a feeling of independence and promote a sense of personal responsibility that's unheard of in the special needs trust world.

As I said, an ABLE account may not work for someone with severe needs, but it might be partnered with a traditional special needs trust to provide a person with control over at least a portion of the available funds. Any degree of self-determination in these difficult situations can be life-changing.

Sure, there are some limitations on ABLE accounts that go beyond a message you may be reading somewhere by the water, but maybe this will plant the seed.

Posted July 11, 2017 - misc.

Ask the Right Questions by Phil Runyon

10/31/2016

Ask the Right Questions

Most of us won’t ever run for public office, but that doesn’t mean we don’t engage in important public service. I venture to say that everyone reading this is now or has fairly recently been serving on a non-profit or municipal board or committee of some sort. And when we were asked to serve, our questions were usually, “How often are the meetings?” and “Do I have to ask people for money?” While those are still important questions, we should now be asking this one, too: “Does the organization have directors’ and officers’ liability insurance, and will it cover me for the things that might cause potential liability?” Actually, the last part of that question could be the most important, so don’t leave it out.

Here’s what I mean. Let’s say you’re on the board of a private school or day care center. Will the organization’s D&O policy cover you if suit is filed against the board because one of the teachers or caregivers molested a student or child, or sexually assaulted or harassed another employee? Will the policy cover you if the board is sued because the business manager filed fraudulent tax returns to cover up a history of misappropriating the organization’s funds - and will it keep you from having to make good personally on those obligations? Also, will the board have coverage if one of those employees is terminated and then files suit for wrongful termination? And if you’re sued personally - it happens frequently in these cases - will the policy provide you with legal representation and pay the fees – because we all know how expensive lawyers can be, right, even if we win?

Needless to say, there’s almost no chance that the person you pose these questions to will have the answers. Don’t let that deter you, though, and don’t settle for a squishy response that doesn’t really give you the information you need. No, I suggest you ask for a written explanation of coverage from the agent or carrier of the organization’s D&O policy – as I did when I asked Tim McMahon of the Bellows-Nichols Agency about all this. You’ll probably be doing the rest of the board a great service at the same time. Then, if you get the right answers, you’ll be good to go; you’ll have immediate cred for insightful brilliance; and you can serve with distinction and peace of mind. But if you don’t hear enough to put you at ease, either the organization can do something about it for the whole board’s benefit, or you can make your mark elsewhere. Either way, you’ll be ahead of the game.

Posted 10/31/2016 Misc.

The Conversation by Phil Runyon

6/10/2016

The Conversation

I hope your good weather activities are off to a fast start – and that all your hiking and biking are making estate planning less urgent, shall we say. On the upside, longevity authorities now predict that the first person to live to 150 has already been born. Still, as far as I know, mortality is holding constant at 100%.

Perhaps because of that last statistic, I often get asked whether I find it discouraging that despite all my best planning efforts, I end up losing most of my clients eventually. In the spirit of the campaign season, I usually dodge those questions by asking whether people have made the same inquiries of their physicians.

But let’s not dodge it here. Most of us have come to the realization that we’re not going to make medical history on the order of Methuselah; we just want our brief sojourn here to end the way we hope. That is, please let us die at home, in our own beds, with all our faculties intact, after a vigorous life and a nano period of decline, and with all our loved ones gathered around. Yet, the truth is that 80% of us will die in a medical institution of some sort, and at the end, 50% of us will be incapable of making decisions on our own behalf.

So what do we do to fight back? Well, we could all make sure we have a good, current health care directive, so that if we’re “out of it” near the end, our best interests are in the hands of people we trust to do the sorts of things we’d do for ourselves if we could. But you know that, and most of you have already taken that important step. (You’re in the minority, though, because nationally the percentage is just 25%.)

The problem is, even that’s not really enough. You need to have “The Conversation”, to use the term coined by Dr. Sanders Burstein of Dartmouth-Hitchcock Nashua (and probably others). In other words, you need to get a lot more specific about what you want than the basic choices given you in the canned documents the statute prescribes. Even our versions, which expand considerably on those selections, still aren’t enough.

You need to talk – a lot – with the person(s) who will be in charge if that unhoped-for time comes. Sure, it’s a conversation no one wants to have, which is why it happens so infrequently – like when you need to have that birds-and-bees talk with your teenager. So have it before the time comes, when you can still make dark, nursing home humor about it, even while being completely serious. And someone should be taking notes, including quotes, if possible. If you just can’t bring yourself to broach the issues, though, or if no one will sit down and listen (which is sometimes the case with family members in denial), then put it in writing for them and attach it to the official document. If we’re holding your directive in our safe, we’ll be happy to supplement it with your specific guidelines.

What am I really getting at, you say? Here’s my very brief stab at it: “I love to read history, follow my favorite teams, get together with my friends and family, and take walks on nice days, and I’ve always thought it important to feed myself and make private use of the bathroom. If it gets to where I can’t do the majority of those things, and I can’t decide about what to do myself, then I don’t want any efforts made to keep me going by medical procedures or drugs. I want nature just to take its course, and if it looks like that’s happening, I don’t want anyone to interfere with that process, except to keep me as comfy as possible. You may be reluctant not to do all you can to help me hang on, but that’s not what I want. Life here will already be over for me, so let me get on to wherever else I may be going. I sincerely appreciate all you’ll be doing for me, and I hope being clear about my wishes will put everyone's mind at ease.”

Not bad for a start; I actually feel better already.

Posted 06/10/2016 - Misc.

Peering Over the Horizon by Phil Runyon

3/2/2016

Peering Over the Horizon

My wife and I were just in Cuba and spent much of the trip admiring those beautiful '50's cars of our youth. However, with no seat belts in them and exhausts still belching the byproducts of leaded gasoline, it's a good thing the island has national health care.

The one thing we didn't see any evidence of was a nursing home, probably because the youngsters just take care of their elders at home - like Americans once did. Some still do, of course, but with families all out working to make ends meet and with the explosion of senior care facilities, it's often easier for everyone to choose one of those alternatives. And if you need more care than the family can provide, you may have to start paying for care anyhow - usually at alarming rates.

Consequently, people keep asking how they can arrange their affairs so they can get the care they need, but not spend up everything they've worked a lifetime to accumulate. The knee-jerk solution is often to give it all away to the kids, so the parents look like they don't have anything and can qualify for Medicaid. I've talked about the shortcomings of that course before, so I won't repeat the disadvantages here.

But let's really look at the current state of affairs. True, a pretty nice nursing home can cost in excess of $100,000 per year. Yet the odds of needing one are in our favor. Even as long as we're living today, only about 40% of us will need a nursing home at all, and the chances of needing more than 3 years of care are only 25%. If my math skills haven't failed me, that means there's only a 1 in 10 chance of needing to pay more than 3 years of expenses.

So what does this mean? For one thing, it means we'd be crazy to give everything away - or make other inconvenient arrangements - just to avoid a 10% chance that our funds would be depleted by nursing home bills. Does it mean, though, that we'd be better off hedging our bets by paying the premiums for long-term care insurance? Maybe, but that involves a further calculus. Do we have a family history of Alzheimer's or some other debilitating condition that might afflict us, as well? Can we get LTC coverage at reasonable rates we can afford? The latter will depend on our ages now, our current health, and how much coverage we want to spring for. If we don't have any lurking family skeletons, though, maybe our risk of needing a nursing home will be even lower than 1 in 10, and perhaps our best insurance will be eating right and exercising. And some of us may even have old-fashioned families who say they want us to enrich their lives with tales of mail with stamps and phones on cords.

One way we might have our cake and eat it would be to forgo the insurance, but to pretend we're paying for it by contributing what we can afford to a rainy-day investment account. If we're still young enough to make IRA or 401K contributions, then ramping those up would be the way to go. If we never need the nursing care, we've buttressed our retirement savings or our grandkids' college funds, but if we do have to pay a nursing home, at least we'll have saved something extra toward those costs.

Clearly, if we knew what was over the horizon, we'd know exactly what to do. We certainly wouldn't bother with any insurance until just before we needed it. On the other hand, I guess we wouldn't waste time and money writing all those wills and trusts either - that would only improve on things for one of us!

Posted 3/2/2016 - Asset Protection

Another Planning Resolution by Phil Runyon

1/25/2016

Another Planning Resolution

In addition to resolving to being nicer people this year, let's also resolve to keep our planning documents in good order - and let's start with our trusts.

Many of us have trusts that say to use the assets for our children's or grandchildren's "health, maintenance, support and education" (HMSE) until they hit certain ages, and then to distribute what's left to them outright. Maybe the children (or a particular child) have already reached those ages but still need some oversight to use the assets responsibly. That might call for pushing the distributions out a little farther, or at least dividing them into two or more installments so poor choices at one age won't completely drain the tank. But consider . . . .

The HMSE standard for distributions can itself be problematic these days, in the event a child is faced with divorce. More and more courts (most recently in Massachusetts) are holding that trusts based on that standard can be valued and considered in property settlements with the child's soon-to-be-ex-spouse. The better plan in this judicial climate is to make distributions to or for the children completely discretionary by the trustee - so there's no quantifiable expectation of distributions at all. And to eliminate all specific ages for final distributions - so there's no way to compute (and award the ex-spouse) the present value of what may eventually be distributed. Needless to say, it's also important that the child not be his/her own trustee, or the court will see right through that arrangement - so consider using either an independent trustee or multiple trustees who would have to act by majority or unanimous consent. Of course, if you figure your kids just have to sink or swim at some point, then fine as long as you understand the issues.

While we're on trusteeship, consider this issue, as well. Many banks and brokerage firms have gotten extremely skittish and aren't willing to allow an agent to act for a trustee through the trustee's power of attorney - no matter what it says. That can cause real problems if you've gone to the trouble of titling all your assets in your trust's name (say, to avoid probate), but you're still the sole trustee. If you want a child or another agent to be able to act for or with you, you may need to appoint that agent as a co-trustee of the trust, or even to resign so the successor trustee can carry on for you.

This emphasizes how important the role of successor trusteeship can be, and why it's critical to make sure the ones you've designated are still right for the job. Maybe they've had health or financial setbacks of their own, or perhaps a new job has taken them several time zones away. Maybe if they're your contemporaries, you just need a new generation of trustees who can carry on as long as the trust is likely to be needed.

Finally, if your trust is more than 10 years old and hasn't had a recent physical, it's time for one. In addition to what I've already said, maybe the people or organizations you named as partial or contingent beneficiaries are no longer the apples of your eye; or perhaps the joint trust you have with your spouse says the surviving spouse can't make any revisions after you're gone, and now that seems like a good safety valve to include. And these are just the low-hanging fruit.

Posted 01/25/2016 EP

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