Your “Blended” Family Is Likely Headed to Court Unless You Do This

Family is the most important priority to a great majority of people – whether that includes full or step-siblings, birth parents or adoptive, or family you have chosen for yourself. Because it is so important, many of us want to make sure our families are taken care of after we are gone. For those of us who don’t have a nuclear family, however, which is made up of a mom, a dad, and full siblings, protecting and taking care of your family can be a little more complex.

If you have a blended family and you do not plan for what happens to your assets if you are incapacitated or gone, you are almost certainly guaranteeing hurt feelings, conflict, and maybe even a long, drawn out court battle.

So let’s start with an explanation of what a blended family is and whether you have one. If you have stepchildren, or children from a prior marriage, or other people you consider “kin” who are not considered legal relatives in the eyes of the law, you’ve got a blended family.

Bottom line: if you have a blended family, you need an estate plan, and not just a will you created for yourself online, or a trust that isn’t intentionally designed to keep your family out of court and out of conflict. Period. End of story. Unless you are okay with setting your loved ones up for unnecessary heartache, confusion, and pain when something happens to you, you need a well-structured estate plan.

What Will the Law Do?

Blended Families, once considered ‘non-traditional’ families are swiftly becoming the norm. Currently 52% of married couples (or unmarried couples who live together) have a stepkin relationship of some kind, and 4 in 10 new marriages involve remarriage. So, clearly, this is no longer ‘non-traditional’ but quite traditional, though our laws about what happens if you become incapacitated or die are still very much based on the traditional nuclear family.

Every state has different provisions for what happens when you become incapacitated or die, and the laws of the state where you become incapacitated or die may or may not match your wishes.

For example, in Colorado, if you are survived by a spouse, your surviving spouse would only receive a part of your estate if you have living children (or parents!), and your living children or parents would receive the rest. And the amount your spouse receives is variable based on the number and ages of your children.

In contrast, in California, all community property assets would go to your surviving spouse, and separate property assets would be distributed partially to a surviving spouse and partially to your children, in amounts depending on the number of surviving children.

In Texas, it can get very complex, depending on whether your assets are separate or community, and whether you have children from the marriage, no children from the marriage, or living parents or siblings.

These are examples to show you that where you die can significantly change the outcome for your family and for your assets, and it may not result in the outcome you want for your loved ones, especially if you have a blended family situation.

So, here’s what you do to make sure that things do go the way you want: call us and schedule a Family Wealth Planning Session. While the session is normally $500, if you do some homework ahead of time (homework that’s going to make sure your family can find everything you have if and when you become incapacitated or die), we’ll waive the Family Wealth Planning Session fee for you, and spend two hours getting to know you, your family dynamics, and your assets, and teach you about the law here in our county and how it would impact your family and your assets in the event of your incapacity or death, so you can ensure that things go the way you want for the people you love.

Even within “traditional” families, aka married parents with families, I want to emphasize that having a full plan is the best way to provide for your loved ones. However, with “blended” families, carefully considered estate plans are even more vital to avoid the massive misunderstanding and conflict that comes with faulty or incomplete plans, and often result in having your assets tied up in court instead of going to the people you want to receive them.

Disputes Between Spouse and Children from Previous Marriage

One of the most common problems that arises in a blended family is that the children from a prior marriage and the surviving spouse end up in conflict. This one is sadly common. Unless a comprehensive plan has been created, it could be very easy for your surviving spouse to cut your kids out completely.

When you’re considering all of these factors for the people you love, it’s important to have a lawyer who can help you look at the reality of what will happen if you become incapacitated or when you die. With the complexities of modern families, it’s better to know than to leave it to the law or a court to provide. That way, not only do the people you love get the assets that you want them to receive, but you may also be saving them from years of legal conflict. Just give us a call and we’ll help you review your options.

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This article is a service of Cris Carter Law, the attorney with heart. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $500 session at no charge.

How to Avoid the Need for a Prenuptial Agreement

Despite the current COVID-19 reality we live in, so many happy couples have tied the knot this year. Social media has been flooded with beautiful pictures of small, intimate ceremonies, handsome grooms and gorgeous brides, and some wedding parties sporting matching masks.

If you’re counting down the days to your wedding, you may be thinking about the flowers you want to have decorate your aisle, or the food you would like to cater to your guests – divorce is probably the last thing you and your fiancé are or want to be thinking about. And yet, you might be rightfully concerned about what would happen to your assets in the event of a divorce—or your death. You may also be worried that suggesting a prenuptial agreement could hurt your future spouse by making him or her feel as if you don’t trust them, thereby creating friction before the marriage even begins.

While such concerns are valid, you should know that prenups aren’t your only option for shielding your assets from these scenarios. With a well-designed estate plan, for example, you can structure your assets in such a way to keep what you have safe, provide for your future spouse in the event of your death, and also protect your assets in the event of a divorce. In this way, you can avoid having the prenup conversation all together.

We do recommend talking with your future spouse about your assets, what would happen in the event of your death, and also making plans in advance so you can feel confident that any children from a prior marriage (or an expected inheritance) are well-planned for no matter what happens. In the following article, we will discuss the pros and cons of prenuptial agreements.

Prenup Pros

Sets clear financial expectations: For many couples, not openly discussing money and the partnership’s financial expectations can lead to big problems down the road. In fact, money problems are one of the leading reasons that marriages end, right up there with infidelity. A well-counseled prenuptial agreement and communication between both spouses could be an opportunity to start your marriage with complete transparency and clearly establish the financial and property rights of each spouse should a divorce occur or in the event of the death of either spouse.

Helps protect your separate assets: If you have any tangible or intangible assets you are bringing into the marriage that you don’t want to risk losing, a prenuptial agreement can help shield that property from divorce proceedings or from a future “elective share” of a spouse upon your death. This can be vital if you have significant assets like a business, real estate, intellectual property, vehicles, or family heirlooms. And, if you know you’ll want to ensure your assets go to children from a prior marriage, a prenuptial agreement can protect those assets for your children.

Helps prevent a lengthy, contentious, and expensive divorce: Divorce is never fun and can often be both emotionally and financially painful, but putting a prenuptial agreement in place could make it less so. Clearly establishing the financial and property rights of each spouse when the relationship is at its most loving—and putting those parameters in a legally-binding document—can greatly reduce the chances of you two battling it out in court later if your marriage doesn’t work out. A long, expensive court battle is the last thing you need when dealing with the painful emotions and often-hefty legal fees associated with a divorce.

Helps prevent disputes over debt: Not everyone is equal in their ability to manage their money. As mentioned earlier, disagreements over finances are a frequent reason marriages fail. Therefore, it could be a good idea to use a prenup to identify who is responsible for taking care of specific debts and liabilities. You don’t want to be stuck paying for your ex-spouse’s credit card debt when you had nothing to do with racking it up.

Prenup Cons

It’s not exactly a romantic gesture: No matter how untrue this assumption may be, people often perceive creating a prenuptial agreement as expecting the marriage to fail or that it indicates a lack of trust. Such concerns should be respected and addressed as tactfully as possible. But the reality is marriage involves lots of issues that aren’t romantic, and dealing with such delicate matters up front could bring the two of you closer (or expose hidden red flags), regardless of whether an agreement is actually created or not.

Whatever you do, don’t wait to have the discussion until right before the ceremony. It’s not only extremely rude, but it could lead a court to invalidate an agreement put in place at the last minute as being created with undue pressure.

It might not be necessary: What a prenuptial agreement can cover depends on what kind of assets you have and where you live. Given this, existing divorce laws might already split your assets up in a way you think is fair. For example, in community-property states, the court will divide the property you and your spouse acquired during the marriage in an equal 50/50 split, while each spouse gets to keep his or her separate property. If you have questions about this, we can talk about how the laws apply to you and your particular asset profile.

It can’t resolve issues of child custody, support, or visitation: It’s important to note that prenups can’t address certain issues related to children and divorce. For example, though prenups can help ensure your children from a prior marriage are able to inherit assets you want to leave them, these agreements cannot be used to address child support, custody, or visitation rights. Those issues must be resolved by the court, so a prenup would be useless if that’s what you’re hoping to achieve.

It may require two lawyers to be valid: Prenuptial agreements may be invalidated if both parties are not represented by independent legal counsel. And depending on the lawyers you each work with, lawyers who are not well-experienced with counseling, care, and conflict resolution can inadvertently escalate or intensify conflicts, rather than supporting you and your future spouse to get on the same page.

Alternative Options

If you plan ahead, certain estate planning vehicles can be used to protect your assets from divorce settlements and ensure that assets pass to your children from a prior marriage in the event of a divorce. There are different types of trusts, for instance, that can be set up to allow you to protect assets for yourself in the event of a divorce, and for your children in the event of your incapacity or death.

Meet with us for additional help deciding whether a prenuptial agreement is the right choice for you and to discuss other estate planning alternatives that could achieve similar protections.

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This article is a service of Cris Carter Law, the attorney with heart. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $500 session at no charge.

COVID-19 Highlights Critical Need for Advance Healthcare Directives

As the COVID-19 pandemic continues to ravage the country, doctors across the nation are joining lawyers in urging Americans to create the proper estate planning documents, so medical providers can better coordinate an individual’s care should they become hospitalized with the virus.

For many people, this can seem like a daunting task to choose how and what they want for medical treatment if something were to happen to them, and who they would want to make those decisions on their behalf. As there are so many unknowns, it can be hard to think about this subject and decide how you want to be taken care of – which is why we are here to help walk you through creating advance healthcare directives for you and your family.

The most critical planning tools for this purpose are the medical power of attorney and a living will, which are advance healthcare directives that work together to describe your wishes for medical treatment and end-of-life care in the event you are unable to express your own wishes. In light of COVID-19, even those who have already created these documents should revisit them to ensure they are up-to-date and address specific scenarios related to the coronavirus.

While all adults over age 18 should put these documents in place as soon as possible, if you are over age 60 or have a chronic underlying health condition, the need is particularly urgent. Contact us right away if you or anyone in your family needs these documents created. We are here to help you and your loved ones stay protected during this time.

Advance Directives

A medical power of attorney is an advance directive that allows you to name a person, known as your “agent”, to make healthcare decisions for you if you’re incapacitated and unable to make those decisions yourself. For example, if you are hospitalized with COVID-19 and need to be placed in a medically induced coma, this person would have the legal authority to advise doctors about your subsequent medical care.

If you become incapacitated without a medical power of attorney, physicians will generally look to someone in your family to make these decisions for you. If there is no dispute between your family members, that may work. However, if there is a dispute or if no family can be located, they may ask the court to appoint a legal guardian to be the decision-maker. In either case, the person given this responsibility could be someone you may not want to have power over such life or death decisions—and that’s why having medical power of attorney is so important.

While a medical power of attorney names who can make health-care decisions in the event of your incapacity, a living will explains how your care should be handled, particularly at the end of life. For example, if you should become seriously ill and unable to manage your own treatment, a living will can guide your agent to make medical decisions on your behalf.

These decisions could include if and when you want life support removed, and whether you would want hydration and nutrition if that was the only thing keeping you alive. To ensure your medical treatment is handled in exactly the way you want and prevent your family from undergoing needless stress and conflict during an already trying time, it is vital that you document what you want in a living will.

Keep Your Directives Updated

Even if you’ve already created advanced directives, now is the perfect time to review the documents to ensure they still match your wishes and circumstances. For instance, is the agent named in your medical power of attorney still the individual you would want to make these decisions? Has your health changed in ways that might affect your living will’s instructions? Are your values and wishes regarding end-of-life still the same?

What’s more, whether you are creating new documents or updating your old ones, you should keep COVID-19 in mind. The highly contagious and life-threatening nature of the coronavirus is something medical providers have never dealt with before, and it has strained our nation’s healthcare system to the breaking point. It is in your best interest to protect yourself now, before you or one of your family members gets sick.

Coronavirus Considerations

In light of COVID-19, there are a few unique circumstances you need to be aware of when drafting these documents to ensure all of the potential scenarios related to the coronavirus and its treatment have been properly addressed.

1. Don’t do it yourself: While you can find a wide selection of generic, advance-directive documents online, you shouldn’t trust these do-it-yourself forms to adequately address such critical decisions. This is especially true during the ongoing pandemic when doctors are constantly tasked with making highly difficult and uncertain decisions for patients suffering from this deadly new virus.

When it comes to your medical treatment and end-of-life care, you have unique needs and wishes that just can’t be anticipated by fill-in-the-blank documents. To ensure your directives are specifically tailored to suit your unique situation, you must work with experienced planning professionals like us to create—or at the very least, review—your medical power of attorney and living will.

2. Open lines of communication: Because COVID-19 is so contagious, family members of those who’ve contracted the virus are often not allowed to accompany them to the hospital. This means your agent likely won’t be there in person to make your treatment decisions. While most advance directives give your agent broad authority to communicate with your medical providers, the documents may not explicitly authorize certain types of remote communication that have become necessary with the COVID-19 crisis.

To remedy this, you may want to consider adding language to your directives expressly authorizing your agent to give directions by phone, Zoom, email, Skype, FaceTime, and other methods. To facilitate this communication, you should bring copies of your directives with you to the hospital to give your doctors, and ensure your agent (and any alternate agents named) have updated copies on-hand as well.

We can guide you to make informed, educated, and empowered choices to protect yourself and the ones you love most – especially in the midst of the COVID-19 crisis. Contact us today to get started with a Family Wealth Planning Session.

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This article is a service of Cris Carter Law, LLC. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $500 session at no charge.

Three Unique Ways to Handle the Guilt Inherent in Being a Parent

If you’re a parent, you may feel even more guilt than usual. If so, you are definitely not alone. Currently, the burden is on you to both carry on with your work and manage your child’s full-time care and education. Two full-time jobs that you’re trying to do by yourself, likely without teachers or care providers to help you.

If you are like most parents, you were probably struggling with guilt even before the virus. You simply can’t make it to every award ceremony or recital, and you might not have as much time to play with your kids or help them with their homework as you’d like. Those feelings of guilt may now be compounded by all the additional responsibilities you’ve had to take on in a short space of time.

Take a deep breath, and let me let you off the hook here for a minute. I have no doubt you are doing the best you can, and your kids see it, and know it too, even when they are being ungrateful pains in the rear.

I’ve got a few ideas about how to shift the guilt. They’re a little unconventional, but I invite you to give them a try and then message me to let me know how they went. We love hearing from you.

Let’s start with one thing that is fully within your control, can help to alleviate feelings that you are not doing enough, and that you can get handled easily, for free, right now – name legal guardians for your kids, so the people you want will take care of them, if anything happens to you.

Quality Time By Doing Nothing

While you’re probably already spending a significant amount of time with your kids, it may not be very high quality. But you may be too tired or overwhelmed to plan big activities, or the things you used to do for “quality time” may not be available.

So, what’s a parent to do?

Nothing.

Yes, you read that right, nothing. If you can take 15 minutes or so out of your day and do nothing with your child, it could be the best 15 minutes you spend with them, and with yourself, all day. Maybe you’ll even be able to stretch it to 30, 45 or 60 minutes of nothing. It’s truly one of the best gifts you can give to your kids, and the best part is you don’t have to do anything.

We hope this idea provides some relief from the guilt. You don’t have to do as much as you think. Mostly, your kids really just want to know you are there, and will give them your full attention, without screens, even if they aren’t paying attention to you.

Name Legal Guardians

If you have not already legally documented who you would want to raise your children, do it now. Legally documenting your choices for who you want to take care of your kids is a great first step to getting legal planning in place for the people you love. (Yes, I said “choices” because you want to name at least one person with two alternates.) And, doing so can provide you with a lot of relief, if you have not taken care of this yet for your kids.

So that’s one way to remove some of that mom or pop guilt you may have. And, here’s another…

Talk About It

If you’re on an emotional roller-coaster right now, your kids are probably having some similar struggles. This is an opportunity to connect with them, and a good time to show them a little vulnerability of your own. Remember how important sharing words of love and comfort can be, both to them and to you.

A friend of mine has three kids ranging from eight to fourteen, and she recently told me a story about a very special conversation with one of her children. After my friend had spent a few weeks juggling school, work responsibilities, and a million other household duties, she was feeling worn out and discouraged.

Then she took a quiet moment to just sit around and talk with her tween daughter and share some of what was going on for her, that it was hard, and how she was making it through. Out of the blue, to my friend’s surprise and gratitude, her child gave her a big hug and said, “You do so much to take care of us all the time. That must be so hard. Thank you.”

This special moment filled my friend’s heart, and it has gotten her through some tough days. And it never would have happened if she hadn’t taken a little time out to just talk with her kid, without a particular agenda.

Reach out for Support

If you have been feeling really alone and need support, reach out for help. Sometimes venting to your friends is enough, and chances are they’ll be able to relate! But if you are not getting the support you need, there are professionals who will communicate via phone and even text message. You can find local therapists and phone, video, and online therapists through Psychology Today’s directory.

Or, if family dynamics are rearing their head during these stressful times, and you want to keep your family out of court and conflict, your estate plan would go a long way towards relieving those stressors. Give us a call to see how we can help.

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This article is a service of Cris Carter Law. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $500 session at no charge.

Should You (or Your Parents) Be in the Stock Market Right Now?

Investing in Yourself

The best investment you can make, is an investment in yourself. The more you learn, the more you’ll earn. – Warren Buffett

Investing in yourself means you are investing in your future. Spending time improving your knowledge, participating in trainings or webinars, being promoted at your job, growing your assets – all of these things can only serve to protect and help you build a better future for your family. One of the most important things you can do to build a better financial future is to invest your assets.

If you or your parents have a retirement account, or any investment accounts for that matter, now is the time to make sure you understand how these accounts are invested. While you may have handed over all of these decisions to a broker in the past, you can no longer afford to have someone else manage your investments without your input or understanding of exactly what you are investing in, how you are investing, and whether your investments align with your plans for the future.

My colleague shared a story that hit home with me, and it may for you as well.

After my colleague’s grandmother died, her grandmother’s retirement and investment accounts went directly to her mom, due to the estate planning they had set up. No court process. No intervention. No conflict. Great!

But my colleague’s mom had never looked at the investments in those accounts. She left them as they were for four years until finally, her daughters convinced her to look.

When they did look, they were mortified to find that, even though the investments should have been gaining with the bull market we’ve been in for the last many years, the accounts had actually decreased over the years from $100,000 to $60,000. If my colleague and her mom had looked at these accounts and re-allocated them when grandma died, this would not have been the case.

Fast forward to now, and the daughters think to look at mom’s retirement accounts with her, only to discover that mom has a 401k with $180,000 in it and it’s lost $17,000 over the last two weeks. Mom had picked her investments with the help of a friend many, many years before, and hadn’t looked at those investments since then. My colleague’s mom had chosen to mostly invest in high-growth ETFs, which may have been the right choice when she was building her retirement fund, but definitely is not the right choice given that she retires next year and will need to start making withdrawals to replace her income.

If their mom doesn’t get her money into safer investments now, her daughters could end up needing to support her for the rest of her life.

So, why am I sharing this story with you? Because now is the time for you to get connected to your investments, even if they are in a retirement account and invested through a broker or advisor. This is simply not the time to set it aside and forget it. It’s time to know what you have, and make intentional choices about how your resources and your parent’s resources are being used.

Now is the time to truly understand what you have, and how to use it wisely.

Educate Yourself

If you or your parents have a retirement account, and you are not intimately connected to how your assets are being invested, it’s time to get more involved. Log in to your retirement account or pull your last statement and look at your investments. Many brokerages select investment funds for their clients’ portfolios based on rates of growth. They’ll offer investment options based on a few tiers of growth and risk, and very often you have no idea what your assets are actually invested in.

Labels like “slow-growth” or “conservative” or “high-growth” or “income” aren’t enough to tell you exactly where your money is invested. What you want to do now is look at your statement and find the names of the funds chosen for you, and you can go from there to do your research. Look up each of the funds on sites like Yahoo Finance to see what you are investing in, and whether you understand these companies, believe in their future growth, and want to stay invested there.

If your investments are tied to an index, like the S&P, are you willing to keep betting on its growth? If not, now may be the time to make a shift. You may have some losses right now, so you’ll have to decide if you want to lock in and limit those losses (and potentially trade some future gains even) to get more connected to what you are investing in now.

Go through this process with your parents, too. The money they have invested in the stock market is part of your overall family wealth. If it’s not there to support them through their senior years, that financial responsibility will eventually fall to you. Having these conversations with them now can be difficult, but it’s important. And if you need help with this, please let us know, and we can support you as you raise these issues with them.

If you have a broker you work with, call them now, and ask to get on a video conference. Then, have them help you review each investment, why it’s been chosen, and whether there may be better or other options for you or your parents.

Here’s the key: make sure you understand the investments you have and don’t hang up the phone until you do. If your broker is using words you don’t understand, keep asking questions until you do understand.

If you need a referral to an advisor, or want us to sit down with you to help you look at what you have, give us a call.

With everything that is happening in the world—and with the volatility of the stock market and our current reality —knowing your options is vital to preserving the life and legacy your parents have worked to build. If you need help figuring out how to best preserve these assets, we are here and ready to support you.

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This article is a service of Cris Carter Law. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.