Tempe Arizona Estate Planning

Gray Divorce Reveals Traditional Roles Still Rule in Family Finances

Gray Divorce Reveals Traditional Roles Still Rule in Family Finances

The divorce rate for 50-plus couples has doubled since the 1990s. That has left many, who relied on their spouses to handle all of the family finances, with some unpleasant surprises.

With all of today’s changes in traditional gender-based roles, it is surprising to learn that a majority of married women—more than 50%—still leave the big decisions regarding investments and financial planning to their male spouses, as reported in Bloomberg’s article, “Rise of ‘Gray’ Divorce Forces Financial Reckoning After 50.”

The study shows that it’s not just older women taking the more traditional gender roles of their parents: about 61% of millennial women said they leave investment decisions to their husbands. This contrasts with 54% for baby boomer women. UBS surveyed more than 600 women who have either been divorced or widowed within the last five years, along with 1,500 couples. Respondents needed to have at least $250,000 in investable assets to take part in the study.

The difference between attitudes toward making major financial decisions between married women and women who were divorced or widowed is remarkable. Almost 60% of widows and divorcees regret not taking part in long-term financial planning, when they were part of a couple.

About 85% of married women who weren’t active in making long-term financial decisions said that their spouse knows more about financial issues than they do.  A total of 80% of women said they were okay with how financial responsibilities were split in their relationship.

Almost all of them would counsel other women to get more involved early on and stop the cycle of financial abdication. Of those women who were divorced or widowed women in the survey who remarried, 80% were more active in the financial decision-making in their current relationship.

More than half of divorcees and widows only learned about financial issues, after the marriage ended. Sometimes, the surprises were good, like learning about a 401(k) account that was previously undisclosed. But most of the surprises are not: credit card debt, outdated wills and secret spending issues.

Widows and divorcees were surprised about how little they knew about the family finances. Almost all of those surveyed said that in any new marriage or relationship, they would demand full financial transparency.

At the Soto Law Firm we help clients, whether single, married, or divorced, get more involved in planning with their assets and finances, through irrevocable asset protection trusts, business planning consulting, and probate avoidance.  We work closely with a client's financial advisor and accountant to determine how we can most efficiently and effectively resolve the issues facing each client.  Please contact our office for a free consultation to get the process started.

Reference: Bloomberg (April 15, 2018) “Rise of ‘Gray’ Divorce Forces Financial Reckoning After 50”

Bookkeeper Fakes Documents in Failed Attempt to Defraud Employer’s Estate

Bookkeeper Fakes Documents in Failed Attempt to Defraud Employer’s Estate

The Kansas Court of Appeals has denied a claim attempting to legitimize a codicil to a millionaire’s will by a former bookkeeper with a history of taking other people’s money.

A 2016 ruling by Kansas City Judge William Lyle was upheld by the Kansas Court of Appeals. A codicil, or addition, to the will of millionaire Earl O. Fields was deemed to be a fake, and the majority of Fields’ estate would not be moved to the former employee, nor would her legal fees be paid by the estate.

Wealth Advisor reports in the story “Kansas Bookkeeper Loses Claim On $20M Boss Estate” that the Court of Appeals found that “…a rational fact-finder could have found it highly probable that Oborny or someone other than Field, at Oborny’s behest, signed the purported codicil instead of Field,” the Appeals Court concluded. “Oborny’s testimony was often inconsistent. She had a history of taking other person’s money,” the Court said.

Oborny was a part-time bookkeeper for Field, who was 98 when he died on February 19, 2013. The Court stated that “Oborny was not present when Field died, because she had to ‘run to the bank.’” She testified that she went to her boss’ office in a bank building on the evening he died and happened to discover two typewritten letters—one addressed to her—that altered the directions for his estate.

Oborny’s testimony was inconsistent and expert witnesses argued that the handwriting, typed letters, and reconstructed shredded letter incriminated her. She had her friends sign as witnesses on the fake codicil. Interestingly, Oborny and the witnesses had an hour-long phone call on the day Field died.

Even more bizarre was the fact that FBI special agents visited the witnesses’ home on August 20, 2015 to get their statements, but the next day their bodies were discovered at a nearby state park in a murder-suicide that took place the day before. When a police detective searched the witnesses’ home on August 21, the couple’s adult son showed him a federal subpoena for the husband to appear before a grand jury the following month.

The two witnesses gave videotaped depositions in the case, before they died.

In the appeal, Oborny contended that the trial judge “drew impermissible inferences from the irrelevant fact that the Littles died in a murder-suicide after being investigated by the Federal Bureau of Investigation (FBI),” the Appeals Court ruling noted. She claimed the judge erred in “stacking” two inferences to impeach the witnesses’ testimony.

That objection was discounted by the Appeals Court.

Oborny next faces federal charges of mail fraud. Her trial is expected to take place later this year.

Reference: Wealth Advisor (February 26, 2018) “Kansas Bookkeeper Loses Claim On $20M Boss Estate”

Frasier Crane’s TV Dad Leaves $5 Million Estate

Frasier Crane’s TV Dad Leaves $5 Million Estate

Before he devoted more than a decade to playing the retired father of TV’s “Frasier,” John Mahoney was a well-known actor, appearing in plays and movies. The size of his estate and the expected number of beneficiaries is evidence of a life well-lived.

Frasier star John Mahoney, who battled a number of serious diseases in recent years, died in hospice in February at age 77 following a routine procedure, as reported in The Daily Mail, in “Frasier star John Mahoney 'leaves behind $5 million-plus estate with 38 potential beneficiaries.'”

The actor was best known for his role as Marty Crane, the live-in retired father of the title character, a radio psychiatrist played by Kelsey Grammer. He had been battling lung cancer, seizures, brain disease, diabetes, and kidney disease, when he passed away, according to TMZ.

About $300,000 of his estate is in real estate, TMZ reported, citing legal documents in a probate case filed by Bernard Dowling, a friend of Mahoney’s. The potential benefactors, many of whom are the television star's friends and family, could total nearly 40 individuals.

Mahoney was born in Blackpool, England, just nine months after Britain entered WWII. He was evacuated from Manchester as a child with his family for safety, during the attacks on Britain. He relocated to America when he was 18.

Frasier aired for 11 seasons and won Mahoney two Emmy nominations for Outstanding Supporting Actor in a Comedy Series in 1998 and 2003. In 2000, the entire show's cast earned the Screen Actors Guild Award for Outstanding Performance by an Ensemble in a Comedy Series.

Before the TV role that made him a household name, Mahoney won a Tony Award in 1986 for his part in John Guare's play, The House Of Blue Leaves. The versatile actor also appeared in such movies as Say Anything and Moonstruck, and frequently performed at the Steppenwolf Theatre in Chicago.

Mahoney was fragile and was supposed to be having a routine procedure, said a friend. However, he had just beaten Stage 3 throat cancer and was just too weak in his final months.

Mahoney never married and never had any children. Based on the number of potential beneficiaries—38— it would appear that he led a full life, with many friends and family members.

Mahoney’s estate plan provided for those that meant the most to him.  If you have not planned for your loved ones, consider meeting with a competent estate planning attorney who give you the proper advice on how to plan for your children and beneficiaries.  At the Soto Law Firm we counsel with clients to develop estate plans customized to their specific needs.  Contact us today to set up a free consultation with one of our estate planning attorneys.

Reference: The Daily Mail (March 24, 2018) “Frasier star John Mahoney 'leaves behind $5 million-plus estate with 38 potential beneficiaries'”

Million Dollar Theft from Husband’s Estate: Probation for Widow, 16 Years in Prison for Boyfriend

Million Dollar Theft from Husband’s Estate Probation for Widow, 16 Years in Prison for Boyfriend

Despite her involvement with the disbarred attorney who stole nearly $1 million from her late husband’s estate, the widow’s sentence did not include jail time.

Charlinette Detmers was ordered to pay $30,000 in restitution and sentenced to four years on probation by a North Carolina court, after pleading guilty to felony embezzlement.

Wealth Advisor’s recent article, “Lover stole nearly $1M from her late husband’s estate on Lake Norman,” explains that court records identify the victim of her embezzlement as her son, Tols Detmers, who was 19 years old when he sued his mother and her lover, a disbarred attorney.

Ms. Detmers is also required to work with her parole officer to find “suitable life skills and educational programs” and not travel out of state, without her parole officer’s permission, according to court documents.

Tols Detmers accused the two of spending hundreds of thousands of dollars that his late father left for him. Fritz Detmers, Tols’ father, lived in North Carolina, and died at age 78 in 2009.

The disbarred attorney is serving a 16-year sentence at state correctional institution for embezzling from the estate, prison records show. A Lincoln County grand jury indicted him on 11 counts of embezzlement. In June 2017, he pleaded guilty in Lincoln County Criminal Superior Court to five felony counts of embezzling $100,000 or more.

According to an affidavit, the disbarred attorney admitted using the money for personal benefit. In addition, court filings in a related civil case show that he spent about $9,200 on an engagement ring for a former secretary at the law firm whom he married. He also gave $15,520 to his wife’s now-defunct boutique shop in Denver.

Thousands of dollars were found to have been used for family trips at luxurious resorts and his personal bills.

This story is a prime example of how naming trustworthy individuals to serve in the proper fiduciary capacities is vitally important.  The individuals you name in your estate plan have broad authority to use estate assets in their administrative capacities.  Unscrupulous individuals, such as those in this story, show the consequences of the misuse of the authority given in a will or trust.  If you don’t think that your close family members can wisely handle such responsibilities, there are many other options, such as naming a professional fiduciary, that are available to you.  You should review your options and your estate plan with your attorney to determine what is the right course for your situation.  Contact the Soto Law Firm today for a free consultation to discuss your options in Arizona.

Reference: Wealth Advisor (February 26, 2018) “Lover stole nearly $1M from her late husband’s estate on Lake Norman”

Fight Elder Abuse in Your Family with Vigilance and Involvement

Fight Elder Abuse in Your Family with Vigilance and Involvement

It’s a sad fact, but many of the worst crimes against seniors are committed by members of their own family, and most of them go unreported.

Elder abuse, including financial abuse, often starts when relatives ask their victims to provide them with power of attorney or have themselves assigned as guardians by a court. It often begins with something small, and if no one else in the family is paying attention, can grow until the victim has lost everything. The best defense: a family member who is involved with their aging relative or parent and is paying attention to the details of their life.

Forbes’s recent article, “5 Ways To Spot And Stop Elder Financial Abuse,” quotes NASAA President and Alabama Securities Commission Director Joseph Borg, who explained that "A guardian is a person or entity appointed by a court to exercise some or all authority over a person and/or estate."

A guardian has the authority to make decisions related to the health and safety of the incapacitated person. Financial abuse by guardians happens when the guardian improperly uses the protected individual’s financial accounts, usually for their own benefit. Here are a few red flags that can signal that there’s a problem:

• Using guardianship authority to transfer property for the guardian’s benefit;
• Receiving personal payments from a protected individual without the court’s permission;
• Authorizing regular cash withdrawals from the senior’s accounts without explanation;
• Using or borrowing property for personal benefit without the judge’s authorization; and
• Making unexplained decisions that aren’t in the senior’s best interest.

The best weapon in the fight against elder financial abuse is vigilance, experts say. You should call a family meeting to talk about the best ways to protect a loved one.

Older relatives may eventually need someone in the family to act as their financial agent under a financial power of attorney, as well as a health care agent under a health care power of attorney. These documents will ensure that, if a senior is incapacitated, a responsible third-party can make decisions on his or her behalf.

At a certain age, older relatives may begin to have trouble doing things like paying bills or watching over their investments. It's a natural consequence of aging and cognitive decline, and they may be suffering from dementia.

Some experts recommend that more than one person in a family be granted power of attorney. Ask your estate planning attorney for help in drafting this document.

It’s important to remember that seniors today are being targeted with scams of all kinds. If they are isolated socially and suddenly have a best friend who has asked for their financial help, start asking questions. You may need to call on other family members, or even local law enforcement for help.

Reference: Forbes (March 30, 2018) “5 Ways To Spot And Stop Elder Financial Abuse”

 

Having “The Talk” with Parents: This Time, About Retirement Planning

Like any tough topic for families, listening without being judgmental is a big part of a success. It is also important to remember that your parents have worked hard to earn their retirement.

Discussing retirement and estate planning is not as much fun as planning a multi-generation vacation, but the conversation is very important, as noted in a recent article from Motley Fool, “3 Tips for Talking to Your Parents About Retirement.”

A 2016 Fidelity study found that 38% of parents say they don't talk to their adult children about retiring, because the conversation never comes up. The survey also found that 93% of adult children and 95% of parents had greater peace of mind, after having "any" detailed conversation about the parents' estate planning.

These conversations can be difficult, but here are a few ideas that may help when talking with parents.

Listen First. Some families still see conversations about money as taboo, and some parents may not think they need to discuss their finances with their adult kids. It is, therefore, important to listen to what your parents are saying when they do talk about the subject. Try to listen first and figure out what they want. Sometimes, they want input on their decisions.  There are other times when they just want to let you know what decisions they've already made.

Research. If your parents talk to you about their retirement plans, it can be tempting to immediately offer your opinions. It’s quite possible that your parents and you need to do some more homework before finalizing any retirement plans or offering advice. It’s also possible that they have done a lot of research on their own.

It's Their Money, Not Yours. Remember that you can't dictate how your parents spend their money. If they want to blow their retirement savings on big vacations or assisting family members to their own detriment, it’s their decision.

This topic gets more complicated if you're the one who might end up financially supporting your parents as they get older. But you can't and shouldn't be trying to control your parents' financial decisions.

Each family should have respectful conversations about their parents’ estate plans. If you learn that your parents do not have an estate plan, including wills, advance directives, and other necessary documents, encourage them to see an estate planning attorney. They may feel more comfortable using the same estate planning attorney that you or another family member has worked with.

At the Soto Law Firm we recognize that family dynamics can be difficult to manage.  Our approach to estate planning focuses on education and providing options, so that our clients can make the right decisions for their family’s situation.   We provide free consultations for those interested in understanding what options are available when planning for the next generation.  Contact us today to get your family’s estate planning headed in the right direction.

Reference: Motley Fool (March 31, 2018) “3 Tips for Talking to Your Parents About Retirement”

What Does an Advance Directive Do?

It’s the worst-case scenario: you become ill or are injured and can’t convey your wishes for end-of-life care. Having an advance directive as part of your estate plan is good.  However, it’s just the start.

Once you have an advance directive, which explains your wishes for end-of-life care, you’ve taken step one. Next, you need to have a conversation with your family about it. You want to make sure that they understand what your wishes are, and you need to let them know where the document is located. If your wishes change, you need to update the document.

Kiplinger’s recent article, “Advance Directive: Ensure End-of-Life Wishes Honored,” notes that many people say, “My family knows what I want, so I’m covered.” But too frequently, that’s not the case.

If you haven’t drafted an advance directive or named an agent under a health care power of attorney, or your loved ones can’t locate it in an emergency, chances are good that your wishes won’t be honored.

If you don’t have an advance directive, create one now and share it.

An advance directive, which usually refers to a living will and a health care power of attorney, should state your preferences for medical treatment in an accident or at the end of your life. It should also designate an agent to make decisions on your behalf, if you’re incapacitated.

Make copies and give them to family members and your medical team. Keep your copies where they can be easily located.

Be certain that your loved ones are clear about your wishes and are willing to carry them out. Have a family conversation that includes as many people as possible, including adult grandchildren. Let them know your preferences, such as: Do you want to be kept alive on a ventilator? Are you willing to live in a nursing home?

Next, ask a trusted relative or friend to be your health care agent. Choose a person who can handle the responsibility and discuss it in depth.

Just as you need to update your estate plan when major life changes occur, you should also review your advance directive with an experienced estate planning attorney. Those changes include the death of a spouse or a child, divorce, a serious illness, a marriage, or a new baby.  Contact the Soto Law Firm to discuss these issues during a free consultation.

Reference: Kiplinger (February 5, 2018) “Advance Directive: Ensure End-of-Life Wishes Honored”