King & Wood, P.A.

Optimize Estate Planning and Update Financial Baseline to Secure Your Future

“Significant benefits throughout the rest of the year can be had if you take some time now to revisit your financial plan and adjust accordingly.”

Revisiting estate planning and financial strategies in the first quarter of the year can yield long-lasting benefits, according to a recent article from Kiplinger, “10 Ways to Refine Your Financial Plan for a More Secure Future.” No matter how busy you are, these ten steps are a good use of your time.

Conduct an annual financial review. Gain a clear view of your financial situation to make informed decisions. Is your net worth the same as it was last year? How have your assets and liabilities changed? Has recent market volatility or a large purchase impacted your overall financial situation? An objective look from a bird’s-eye view shows whether you’re still on track to reach your goals or if you’re retired, ensuring that you’re still on the right path.

Review your philanthropic plans. Whether you’re donating a wing to a local hospital or making monthly donations to local charities, review your giving over the last twelve months. Are you taking advantage of tax benefits through strategies like Donor-Advised Funds (DAFs), or should you consider using Charitable Trusts instead? Consult with your estate planning attorney to ensure that your generosity also benefits you and your family if that is an objective.

Review budgets and spending habits. Having discretionary income doesn’t necessitate a free-for-all. Understanding income and spending is fundamental to financial health at any level. Examine last year’s expenses and separate out one-time costs, such as installing a new roof or incurring large medical bills. Once you’ve identified spending habits, map out a plan for the rest of the year. Treating money with intention is more rewarding.

What’s your illiquid compensation? If you establish a 10b5-1 plan, you can execute stock transactions during open trading windows, mitigating legal risk and balancing your corporate responsibility with personal priorities. This type of plan allows you to schedule trades in advance and align transactions with both near-term and long-term goals. Know the value of any non-cash compensation and how much of your net worth it represents.

Is it time to rebalance your portfolio? If you haven’t rebalanced your portfolio in the last year, now is the time to do so. Be sure your asset mix is still what you wanted. The nature of markets and fund managers makes it impossible to avoid shifts entirely.

Maximize tax-advantaged accounts. Don’t leave money on the table. Accounts like 401(k)s, IRAs, HSAs and 529 plans all work to maximize tax advantages. However, it is only if you’re making contributions strategically. If your income is too high for direct contributions, or if you have a lower income, consider Roth conversions for IRAs and 401(k) plans.

Check your risk management. Insurance isn’t as sexy as investment portfolios. However, the protection is worth the investment. Make sure your wealth is protected with the correct insurance and a good estate plan.

Review estate planning and make annual exclusion gifts. Your estate planning attorney can explain how using your annual exclusion can help reduce estate tax exposure and benefit your loved ones. You can give $19,000 to as many people as you want annually without triggering any gift taxes or reducing your lifetime estate tax exemption. Making these gifts earlier in the year allows for more growth over time, making it a smart move for generational wealth transfers.

Tax planning season. If your finances are complex and your assets extensive, tax-saving strategies need to be revisited annually, and the first quarter is the most likely time. Let’s say you expect to have significant capital gains; charitable giving or tax-loss harvesting earlier in the year can help offset those tax liabilities.

Talk with your family about money. If your goal is to leave a legacy, you’ll want to discuss your values, philanthropy and creating a legacy with your family regularly, as well as stewarding wealth across generations. A habit of regular check-ins about finances will help establish a shared vision for both short-term and long-term goals.

Reference: Kiplinger (March 6, 2025) “10 Ways to Refine Your Financial Plan for a More Secure Future”

Making Your Own Decisions Through Estate Planning

“The estate planning and elder law community prioritizes personal autonomy, allowing individuals to make their own choices, including who will manage their care if they become incapacitated.”

Estate planning is often set aside in favor of more fun activities, like vacation planning and preparing for family holidays. However, once done, it provides great peace of mind. A recent article from MLT News, “Estate planning—making personal choices,” looks at what an estate plan encompasses.

Durable Power of Attorney for Finances and Health Care. These documents allow you to name the person you choose to make financial or health care decisions if you cannot because of illness or incapacity. They can take effect immediately upon being executed or created as “springing” documents that take effect when you are deemed incapacitated. However, springing POAs may lead to delay, so most people choose Durable Powers. Your estate planning attorney will explain the best options for you.

Advanced Directives focus on your wishes for medical care when you are unable to communicate and are nearing end-of-life or likely not to live without artificial means. Your advanced directives can be very specific about what kinds of treatment you want or when you would prefer to be taken off life-support.

Disposition Authorizations are used to convey your wishes for burial, cremation, memorial services, or other terms for what you want to happen to your body after you die. These vary by state, so check with your estate planning attorney. While difficult to consider, if you have strong preferences, it’s best to have them in a written document.

Last Will and Testament direct how you want your assets to be distributed after death. A will is also used to nominate a personal representative or executor who will settle your estate. If you have minor children, your will nominates a guardian to raise them. This is a highly personal choice you can make with a will. Otherwise, the court will decide who will care for your children.

Trusts are used to manage assets during life and after death. A trust is a separate legal entity created to hold assets and distribute them to beneficiaries. A revocable trust allows the person who establishes the trust (the “grantor”) to control the assets held in the trust. However, the trade-off for continued control of assets is that they don’t have the same level of protection as an irrevocable trust. An Irrevocable Trust requires the grantor to give up control of the assets. However, the assets are better protected against creditors and are not countable for Medicaid purposes.

Your estate plan should also include checking on beneficiary designations, which are used in a variety of financial and investment accounts, IRAs, 401(k)s and insurance policies, to pass assets directly to beneficiaries upon your death.

An estate plan includes tax planning to address tax liability by taking assets out of an estate and placing them inside trusts or LLCs (Limited Liability Companies), depending on the family’s circumstances.

For families with members who are disabled, Special Needs Trusts are used to safeguard funds to plan for the individual’s future while maintaining their eligibility for means-tested government benefits.

By creating a comprehensive estate plan with an experienced estate planning attorney, you get to be the one making decisions about your future and your legacy. Without it, the laws of your state and the courts will make decisions about what will happen to you during serious illness, who receives the assets you’ve saved and who will raise your children. We know you’d rather make these decisions than have them made for you.

Reference: MLT News (March 4, 2025) “Estate planning—making personal choices”

On March 26, 2025, Attorneys Kimberly L. King and Robert B. Celander, of King & Wood, P.A., joined by Randy Pople, CFP/AEP, of TNB Financial Services, gave a presentation to the lawyers, financial advisers, and CPAs who comprise the Tallahassee Regional Estate Planning Council on the following topic:  “The Convenient Misalignment:  Swapping assets of an irrevocable inter vivos credit shelter trust treated for income tax purposes as a grantor trust -- flexibility and additional tax mitigation after the transfer to trust.”

 

As a reminder of the estate planning and other services our law firm offers, here is the biographical information provided in our handout to the TREPC members:

 

Kimberly L. King and Robert B. Celander are lawyers in the Tallahassee firm of King & Wood, P.A., where they practice law with Edward W. Wood, Elizabeth J. Maykut, five paralegals (Kathy Arrant, Matthew Pacenta, Amber Rolling, Renee Waddell, and Sandy Veal), and other staff. The firm was founded in 2004. Its practice is concentrated mainly in the areas of elder law, business law, and real property law. The elder law practice is comprehensive and includes estate planning (wills, trusts, durable powers of attorney, living wills, designations of health care surrogates, designations of pre-need guardians, beneficiary designations, enhanced life estate deeds, special needs trusts, and other planning techniques), Medicaid planning, asset protection, probate, guardianship, trust administration, and fiduciary litigation. The firm is outside general counsel for a number of small businesses, including closely-held corporations and limited liability companies. The firm advises business owners on formation, capitalization, shareholder agreements, operating agreements, compliance, succession planning, and purchases and sales of businesses. In the area of real property, the firm handles commercial and residential real estate closings and mortgage loan transactions, issues title insurance, and represents landowners in litigation.

KING & WOOD, P.A. HAS MOVED TO A NEW LOCATION!

 

Our new street address as of March 24, 2025:

 

KING & WOOD, P.A.

1300 Thomaswood Drive

Tallahassee, FL 32308

850-580-7711

www.kingandwoodlaw.com

 

We are co-located with our friends at the Gardner, Bist law firm.

Who’s On Your Estate Planning Team?

“It takes a team of people to build a great retirement plan. Here are the experts you need to reach out to before you make your big move.”

Figuring out when to retire is one of the biggest decisions people make. Engaging with trusted professionals can help you make the best decision for your circumstances. To be sure you’re fully prepared, an aptly-titled article from Kiplinger recommends “The Six People You Need to Talk to Before Retiring—and the Best Questions to Ask.”

A financial planner will help clarify long-term wishes and goals. By working with a financial advisor early on, you’ll have someone to develop a plan for the lifestyle you want in retirement and understand how to get there. When you’re closer to retirement, they’ll help button down your plan and help you make realistic decisions.

An experienced estate planning attorney will ensure that your estate is prepared correctly and your legal affairs are in order, with protection in place if you become incapacitated and after you’ve passed. Even if you don’t expect to leave significant assets to heirs, your family will appreciate your having an estate plan so they aren’t faced with the stressful challenges and costly problems occurring when there is no will. The estate planning attorney will discuss whether you need a trust to protect assets and smoothly transfer assets to beneficiaries.

You’ll also want Power of Attorney and Health Care Proxy documents created specifically to your wishes. These documents allow a person you choose to take care of financial and health matters if you cannot speak on your own behalf. Talk with the estate planning attorney about ensuring that assets are distributed according to your wishes and minimizing estate taxes for heirs.

An insurance broker will help with risk management before and after retirement. They can help with the options for Medicare and health insurance coverage, which can be overwhelming once you leave an employer’s plan. Talk with an insurance agent about long-term care costs and what policies are available. You may need to purchase a hybrid life insurance plan to obtain long-term care insurance. However, long-term care costs are exorbitant, so you should have an LTC policy if possible.

Most people don’t know about working with a senior living advisor. However, they can be invaluable to enhancing the quality of your life in retirement. They help people identify a wide variety of tools and services. For instance, many new tech tools are making it safer for seniors to stay in their homes, local services through various agencies and longevity care options to explore.

Social Security advisors add another layer of knowledge to retirement planning. A Social Security advisor will help determine the best time to take benefits based on your financial situation. There’s more than your age to consider. Death of a spouse, divorce, chronic conditions and disability should be considered when deciding on the best time to take benefits.

Retirees need to have a CPA on their team as well. Balancing withdrawals from tax-advantaged accounts like IRAs or pensions, Social Security benefits, and withdrawals from investment accounts must be planned with taxes in mind. A CPA will help you create a plan for cash flow in retirement.

Americans don’t like to talk about death or money. However, when preparing for retirement, these subjects must be discussed to create a good plan. When you’ve identified your team, don’t hold back. The more information you share with them, the better they can help prepare for an enjoyable retirement.

Reference: Kiplinger (Feb. 27, 2025) “The Six People You Need to Talk to Before Retiring—and the Best Questions to Ask”

Will Your Digital Life Outlive You?

“Estate planning isn’t just for the possessions you can touch.”

Most people know they have extensive digital lives, including emails, texts, social media, photos, videos, bank and investment accounts, utilities and streaming subscriptions. They don’t know what happens to these digital assets when they die, as reported in a recent article from Deseret News, “Lost in the cloud: What happens to your digital assets when you die?”

Some people keep even more assets in cyberspace: client records, patient records, inventory, customer databases, websites, blogs and cryptocurrency. There are also digital assets like non-fungible tokens, NTFs, online gaming and Metaverse assets.

With fewer than a third of all adults in the US having a last will in 2024, even fewer have planned for digital assets. Failing to plan for digital assets leaves a nightmare for loved ones when settling an estate. It puts assets at risk of being stolen or lost completely. Identity theft is also far easier when no one’s taken control of or deleted digital assets.

Start preparing for your digital demise by creating a thorough digital inventory. Include URLs for the accounts, your username and password, the account number and value and how the account is accessed. If the account requires two-factor identification through email or text, ensure that your digital executor has this information and access to the physical device.

The next step is to review which platforms allow you to designate a person to take control of your assets if you become incapacitated or die. Google, Facebook and Apple let you designate someone to be a “legacy” contact—the name of the role changes with the platform.

There are nuances to be aware of. You’ll need to decide whether you want someone to have access to the account and the ability to read its contents or just access the account to delete it. If you have private emails, documents, or electronic materials you don’t want anyone to access, you’ll need to be very specific about what you do and don’t want your designated digital person to do.

Figuring out how to manage digital assets isn’t just about what happens when you die. If you become incapacitated, would your spouse be able to pay the electric bill, access mortgage statements, or pay the phone bill?

Also, you may want to reconsider if you manage your personal life through your work email. Your work email does not legally belong to you but to your employer. Your emails can be read by anyone at your workplace with access and authority, including the IT department, supervisors and CEOs. Most employers shut down email access immediately after a person leaves their job or when they learn of an employee’s death. It is wiser to have a personal email for your personal life.

Digital assets require estate planning, just as tangible, traditional assets do. You’ll want to name a digital executor in your will, and you may need a trust, depending on the size of your digital assets. If you own cryptocurrency or NFTs, talk with your estate planning attorney about protecting them as part of your estate plan.

Laws regarding digital assets may vary by state, so find an experienced estate planning attorney familiar with digital assets and can help prepare an estate plan to address digital assets and their protection in case of incapacity or death.

Reference: Desert News (Feb. 21, 2025) “Lost in the cloud: What happens to your digital assets when you die?”

How Estate Planning Protect Assets

“Our family discovered our grandma got involved with someone on the internet from a foreign country who convinced her he was coming to America to marry her.”

Elderly people are often targeted by scammers for two simple reasons: they have a lifetime of assets and are often isolated. When no protection is in place, convincing a lonely person to be generous is relatively easy. One family’s situation is described in a recent article from Market Watch: “’She’s still waiting by the phone’: My grandmother gave her life savings to a man she met online. What now?” It provides a cautionary tale for what can go wrong when no estate planning guardrails are in place.

Their elderly mother emptied her healthy bank and investment accounts and sent the money to someone from a foreign country. Despite the family’s efforts to help, she didn’t believe there was a problem. She told police and elder abuse officials to leave her alone, as she was getting married soon and didn’t need their help.

All she now has left is a pension from her late husband, which will cover the cost of the assisted living facility she’s moving to and $1,000 left over every month. Assets in her bank and investment accounts, which included proceeds from Coca-Cola stocks purchased decades ago, will never be recovered. The bank’s position in these situations is that the account owner authorized the transfers, and they have no responsibility whatsoever.

Having an estate plan in place could have prevented some of this. During the process of creating an estate plan, discussions about planning for the future take place to prepare for scenarios just like this one. Here’s how.

Estate plans often contain several documents in addition to a last will and testament used to distribute assets after death. A Durable Power of Attorney would have been created, naming another person, usually an adult child, to control the elderly person’s finances.

Changing some or all her accounts to joint ownership with an adult child might have added another set of eyes to monitor transactions. Alerting the financial institutions to the adult children being added to the accounts could have also been helpful.

If an elderly parent is unwilling to yield control, the family could go to court to obtain a conservatorship (or guardianship, depending upon the jurisdiction) to control the person’s finances.

A court investigator is appointed to interview the person to determine whether they are truly incapacitated and whether there needs to be a conservator appointed. The person has the right to attend the hearing, have their own attorney present and oppose the request for conservatorship. There is a court hearing where the person must appear, and the judge decides based on the investigator’s report and other evidence.

Having a Durable Power of Attorney is far simpler than going through conservatorship proceedings.

The family should also have her estate planning attorney create a Healthcare Proxy and HIPAA waiver, so they can contact her physician and make an appointment for a physical and mental assessment.

The steps taken in creating an estate plan with an experienced estate planning attorney anticipate the need to protect assets, especially for an elderly person. The estate planning attorney may also be able to refer the family to a social worker who can assist with their mother’s peace of mind. When she realizes she has been taken advantage of, she may experience an extreme emotional response, and the family should also prepare for this.

Reference: Market Watch (March 1, 2025) “’She’s still waiting by the phone’: My grandmother gave her life savings to a man she met online. What now?”

Do I Need Estate and Retirement Plans If I Don’t Have Kids?

“Childless older adults face different challenges in housing, health care and estate planning.”

If you have children, you may not want to depend on them for financial help as you age. However, if it becomes necessary, at least it’s an option. However, if you are one of roughly twenty-three percent of adults in their 50s and twenty-two percent of people in their 60s who never had children, your retirement and estate planning needs to be different.

A recent article from AARP, “How to Plan for Retirement When You Don’t Have Kids,” explains there’s no guarantee, and even if you have children, you’ll need estate and retirement plans.

Having a support team is mission critical. This means having someone who will be able to deal with money and health matters if you can’t because of physical disability or cognitive decline. Think about who is in your extended family or close circle of trusted friends who might serve as your power of attorney or healthcare proxy. Ideally, name someone in relatively good health, possibly younger than you, who lives nearby. Child-free people often have strong bonds with nieces or nephews who are good candidates to be potential caregivers.

An alternative is finding an aging life care professional, sometimes known as a geriatric care manager, to help address health, financial and housing concerns as well as coordinate caregiving and related services for you.

Don’t wait until you need help. Talk with prospective candidates now and meet with an estate planning attorney to start putting plans in motion.

You’ll also want to plan for the possibility of long-term care. The cost of these policies increases as you age, so buying them in your 30s or 40s is ideal. A private room in a nursing home can easily cost as much as $100,000 a year, which can rapidly deplete a nest egg.

Estate planning is different for child-free people. While you may have more disposable income because of not having the financial obligations of children, you may also feel it’s less important to have a legacy. However, you’ll still want a voice in where your assets go after your death.

If you don’t have children and you don’t have a will, the laws of your state will dictate who receives your assets. If you’re passionate about an organization, it won’t receive anything. However, your estranged cousin who lives thousands of miles away and is next-of-kin may inherit your entire estate. If you have ideas about where your assets should go, you’ll want a will.

Creating an estate plan with an experienced estate planning attorney is important for those without and with children. Make an appointment and get this part of your life settled, so you can enjoy your retirement without worry.

Reference: AARP (March 3, 2025) “How to Plan for Retirement When You Don’t Have Kids”

 

Seniors can Protect Health and Financial Security

“During these miserably cold months, seniors face personal safety concerns and potential legal liabilities.”

Even though the calendar says March, winter hasn’t left yet. According to a recent article, “Winter safety for seniors: How to protect yourself from liability,” from News Tribune, an unfortunate event can occur at any time. What can you do to protect yourself?

Start by executing essential estate planning documents. People think “estate planning” is an elaborate way of saying “last will and testament.” However, this isn’t so. They also believe that if there is no will, their children or spouses will inherit everything. That’s not true either.

Accidents and illnesses can strike anytime, so everyone needs to have these estate planning documents in place. At the same time, they can address problems, like incapacity and disability.

Everyone should have a Power of Attorney for Healthcare, a Power of Attorney for Finances, a HIPAA authorization, a Last Will and Testament and a Living Will. Once your estate planning attorney creates Power of Attorney forms, an authorized agent can handle your financial and health matters.

When you grant someone the power to act on your behalf, you don’t lose the ability to act yourself. This differs from guardianship or conservatorship, where the court removes your authority and independence, giving another person power over your life and/or financial matters.

A HIPAA Authorization gives healthcare providers and insurance companies the legal authority to speak with another person about your care. Without this written authorization, properly executed by an estate planning attorney, your family may be shut out of critical decisions.

If you suffer from a terminal condition and cannot explain your preferences for medical treatment, your Living Will provides end-of-life instructions for your healthcare representative (granted through a Power of Attorney for Healthcare or Medical Proxy) and your medical providers.

If you have adult children, ensure that they also have these documents and an estate plan. Having a plan before you need it prevents you from adding further stress and costs to a personal crisis.

Protecting yourself from risk and the unexpected takes a little time and effort. However, when the need for these documents arises, you and your loved ones will be glad they are in place. Talk with an experienced estate planning attorney today to plan.

Reference: News Tribune (March 3, 2025) “Winter safety for seniors: How to protect yourself from liability”

Good Parenting and Estate Planning Work Together

“In terms of more technical estate-planning opportunities, trust provisions are certainly a way to make sure that family values are passed on to the next generation.”

Wealth created by one generation is often lost by the third generation when financial discipline, respect for the process of wealth creation and understanding the responsibilities of wealth aren’t taught from generation to generation. There are ways that parents can help their children and grandchildren overcome this tendency, and estate planning strategies are part of the process, says a recent article from Barron’s, “Teach Your Kids to Preserve Family Wealth, Not Squander It.”

Preparing to transfer wealth is best done with an experienced estate planning attorney. In addition, an annual letter to your children with a summary of the family’s financial situation and a statement of the parent’s values will help educate and update the family.

The annual letter should also share info about where to find wills and trusts and other estate planning documents, contact info for the estate planning attorney, financial advisor and accountant, and the location of life insurance policies. Don’t neglect an inventory of digital assets, their value and how to access them.

Trusts offer an opportunity to express values by creating a trust with incentive provisions and age-related triggers. When a beneficiary reaches certain milestones, like graduating from college or getting married, distributions can be made. There are also means of discouraging problematic behaviors. Provisions may be written to delay distributions until a beneficiary retains a job or enters a rehabilitation program and maintains sobriety for a certain period. Your estate planning attorney will discuss which type of trust is best for your family.

Start by defining your own family’s values and what it looks like to put those values into real-life scenarios. For instance, if you value entrepreneurial spirit, a trust could be created with discretionary distributions and non-binding language encouraging heirs to use the funds to start or expand a business. A trust could also encourage children to buy a home in a community with an excellent school district to benefit their children.

Stating these models without living them defeats the end goal. Children learn values by seeing how their parents behave. These lessons are learned early in life.

For high-net-worth families, avoiding a sense of entitlement is a major challenge. This is where generations lose a work ethic and wealth. Good parenting can avoid this by encouraging children to become resilient and allowing them to fail in safe settings. Developing confidence based on their abilities, whether in academics, sports, or community efforts, will foster a sense of self and independence not based on the family’s wealth.

For regular families intent on building wealth over generations, a healthy respect for the work it takes to build bank accounts, buy a home and create the stability needed for the future takes extra effort. Creating an estate plan with an experienced estate planning attorney can help you plan for the unexpected.

Reference: Barron’s (Feb. 7, 2025) “Teach Your Kids to Preserve Family Wealth, Not Squander It”