In Part I of our blog series for young families, we focused on outlining planning considerations that can help determine which type of estate plan is optimal. In Part II of this series, we outline some tailored options that may help families customize their plan more thoroughly.
1. Uniform Transfer to Minors Act. A minor cannot own assets until he or she achieves the age of majority. Because of this, parents of minor children in Illinois must select a guardian of the estate to manage a minor’s assets until he or she achieves the age of majority. The guardian is subject to strict oversight by a court. Thus, families may opt to create minor’s trusts and transfer assets after their children achieve the age of majority to avoid some of the court costs and fees associated with a guardianship. However, setting up a trust may require an investment of cost and effort that exceeds what is practicable for some young families. If this is true for your family, then an intermediate option that may prove worthwhile is to proactively set up a custodial account under the Illinois Uniform Transfer to Minors Act (“UTMA”). A UTMA account provides a simple, inexpensive option to transfer assets and property to a minor. The account is under the management of a custodian until the minor becomes 21. The custodian is chosen by the individual(s) who set(s) up the UTMA account. There are key advantages to such an account. For starters, a custodial account set up under the UTMA increases the age of majority from 18 (under a guardianship) to 21. Thus, your child has additional years to mature before he or she inherits assets. Additionally, a custodian generally does not require court oversight, which may result in less court time and expenses. But there are also key risks that should be discussed with a financial advisor or estate planning attorney. Notably, any assets transferred to a UTMA are irrevocable. In light of this inflexibility, parents should consider whether they want to set up a UTMA account today or empower their executor of their will to do so upon administration of their wills. Additionally, assets placed in a custodial account are subject to a federal gift tax. Thus, it is advisable to engage in some reflection with an experienced counselor before you make the leap so that you do not incur unnecessary taxes and headache. 2. Digital Assets. Estate planning encompasses not just tangible property like real estate but also digital assets like credit card rewards points and frequent flier miles. It is therefore vital that you put the proper estate planning provisions in place to ensure that your digital assets are effectively protected and passed on in the event of your incapacity or death. Here are some best practices: a. Create an inventory of your digital accounts. You can either compile a list of all your log-in and password credentials or take advantage of password managers that store this information in a centralized repository. Popular choices are Dashlane, LastPass and 1Password. b. Determine the level of access you want your fiduciary to have. As you compile this information, consider the level of access you want your fiduciary to have. If you want your fiduciary to have limited access, then you may not want to share your log-in and password credentials with them. Rather, you should work with your e state planning attorney and the particular service provider to limit the fiduciary’s access. c. Investigate whether your service provider has options. Some service providers like Google, Facebook, and Instagram have tools in place that allow you to easily designate access to others in the event of your death. If such a tool is offered, you should use it to document who you want to have access to these accounts. Carefully read through any terms to determine what access your fiduciary will have.
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This month, we published Part II of our estate planning blog series for young families. We are also thrilled to share a guest post from Anne Haag. Anne Haag is a Practice Management Advisor at the Chicago Bar Association. Anne worked as a patent paralegal at a Chicago IP firm before arriving at the CBA in 2017 as the Law Practice Management and Technology department’s trainer/coordinator. She is also a certified crisis counselor and volunteers as a patient advocate in the ER.
Check out Anne's insights below on how to maintain calm during this time: 2020 has been a stressful year, to say the least. In times like these, it becomes more important than ever to have a set of habits you can return to in order to find clarity and calm. Taking inspiration from Seinfeld, we all need our ‘serenity now’! Here are some habits you can develop that might help you cultivate a calmer mental state and better process stress triggers:
In between the pandemic and the Black Lives Matter protests that have been taking place in cities around the country, it feels more important than ever to keep abreast of the news. I’m not suggesting that you tune out entirely, but it’s important to set boundaries if you find the news to be triggering or anxiety-inducing. Remember, social media and the 24-hour news cycles are designed to be addictive. Find your own balance between staying informed and obsessing over things you can’t control. You can use screen time tracking tools on your phone to examine how much time you’re spending on different activities on your phone and go from there. “Screen Time” is a function built-in on Apple devices. It’s a little more complicated on Android devices, but you can follow steps to access your screen usage statistics here: https://www.guidingtech.com/check-screen-time-different-devices/. 2. Make your notifications work for you. In keeping with the previous point, you might want to restrict the notifications you receive on your phone. You can set restrictions based on time of day, type of notification, etc. You can use the ‘Do Not Disturb’ setting to turn off notifications altogether or after a certain time of day. Personally, I found banner notifications (the kind that roll down from the top of your screen while you’re using another app or looking at your phone) to be an odd source of stress. I removed them altogether and feel like I have greater control over my attention when using my phone. 3. Get some fresh air. If you’re working remotely, be sure to set aside some time each day to spend outside. Outdoor exercise is particularly beneficial to your state of mind. It’s been so hot in Chicago this summer that you may feel more inclined to stay indoors. Finding time in the mornings or evenings to breathe fresh air might take additional planning (and the resolve to get out of bed a little earlier), but you’ll reap the benefits without having to contend with the heat. Even just a 15-minute walk (with a mask, of course) around your neighborhood is a great way to remind yourself that your world isn’t totally bound by the confines of your abode. 4. Practice mindfulness meditation and gratitude. The pandemic has brought home the fact that we have limited control over our lives. This is an uncomfortable feeling to sit with, and we might spend hours wishing we were literally anywhere else. The practice of mindfulness draws you in to the present moment and grounds you in it. This may seem like the opposite of what you want to do, but it might also open you up to experiencing joy in ways you might otherwise miss. When you’re fully rooted in the present, you’re better able to notice small moments of beauty and warmth – something we all need right now. Taking stock of the things you’re grateful for also unlocks this same sentiment. 5. Make safe socializing a priority. The pandemic is probably not going to be resolved anytime terribly soon, and Chicago’s summer weather won’t last. Take advantage of being able to be outside while you can! There are plenty of ways to socialize while practicing social distancing. A weekly picnic in the park with friends might go a long way towards making you feel cared for and content. |
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