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Trust Center

Is It Time To Review Your Estate Documents?

The Because your life isn't static, changes in your personal and financial circumstances could warrant changes to your Will and other estate documents. Consider scheduling a review of your plan if any of the following has changed:

Your family situation. Marriage or divorce, the birth or adoption of a child or the death of a family member are important changes that should prompt a review of your plan.

Your net worth. A sudden windfall, such as an inheritance, can have an impact on your estate and tax planning, as well as your charitable giving strategies.

Your preferences. You may want or need to change an estate beneficiary, children's guardian, personal representative/executor or trustee, or name a different person to manage your financial affairs under a durable power of attorney.

Tax laws. New federal and/or state tax laws may affect your current plan, so it's smart to review your documents when new tax legislation has been enacted.

Your wishes. If your feelings about your care have changed since you created advance directives, you'll want to update them to reflect your current thinking. Advance directives may include a Living Will, which spells out the conditions for receiving or not receiving life-sustaining treatment, and a durable power of attorney for health care (sometimes called a health care proxy) authorizing a trusted person to make medical decisions for you if you're unable to make them yourself.

Your favorite causes. You may need to make changes to your estate planning documents to include new charitable goals.

Not a single thing. Reviewing your estate planning documents periodically is a good idea even if there haven't been any major changes to your personal situation. If you've overlooked something important, you'll have a chance to address the matter.
 

For more information or to schedule an appointment to review your plan, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

Trust services available through MEMBERS Trust Company, 14025 Riveredge Drive, Suite 280, Tampa, FL 33637, a Federal Thrift Chartered by the Office of Thrift Supervision. This is for educational purposes only and is not intended to provide legal or tax advice regarding your situation. For legal or tax advice, please consult your attorney and/or accountant.
 


 

 

Adding a Personal Backup

The managers of well-run businesses usually name backups to keep things going smoothly just in case. That's also a smart plan for your personal finances, where you risk experiencing financial losses or other difficulties if you can't make your own decisions because of unplanned circumstances. You might prepare for this possibility by giving a family member or another trusted individual the legal power to act for you if necessary. But what would happen if you made an unsophisticated individual your personal financial backup? You might be more comfortable using what is called a living trust with a professional trustee that could easily step into your financial management role if needed.

Standby Protection
Here's how a living trust typically works. You initially transfer assets into the trust, naming yourself as the trustee. You also name a reliable, experienced trustee, such as TCU Trust Services, as the successor trustee. At that time, you simply continue managing your finances as usual, until the circumstances that you've specified in your trust agreement prevent it. Then, the successor trustee will take over management of the trust assets for as long as necessary.

More Advantages
Providing a reliable financial backup is just one advantage a living trust can offer. Another is flexibility. You maintain control of your assets during your lifetime and are free to make changes anytime. For example, you could give your trustee more or less responsibility, amend the trust's provisions or even cancel the trust entirely.

Here's an additional advantage: Your trust can protect your family after your death by keeping your assets under a professional investment manager's uninterrupted care. And living trust assets don't pass through probate, which can make the settlement of your estate easier, faster and often much less costly.
Eventually, your family or other beneficiaries will receive the trust's assets on the schedule you've arranged and under the conditions you've specified. That's another advantage, the ability to determine what happens to your wealth over the long term. And the terms of the trust are private, unlike the terms of a will that passes through the probate process.

Trial Period
Last, there's a practical advantage: You can give your future asset management arrangements a test drive. If your trustee manages the trust assets during your lifetime, you'll be able to decide whether you're satisfied with the arrangements you've made, and with the quality and reliability of the trustee's services.

Do you want to explore the use of a living trust as your personal backup? If so, please contact a TCU Trust Services Representative. We can help you plan to protect your assets and we're ready to serve as trustee for you and your family as needed.
For more information, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

Trust services available through MEMBERS Trust Company, 14025 Riveredge Drive, Suite 280, Tampa, FL 33637, a Federal Thrift Chartered by the Office of Thrift Supervision. This is for educational purposes only and is not intended to provide legal or tax advice regarding your situation. For legal or tax advice, please consult your attorney and/or accountant.


 

 

 

 

A Checklist for Surviving Spouses

The loss of a spouse can throw life into turmoil. Although taking stock of family finances may be the last thing a surviving spouse feels like doing, it can’t be put off for too long. The following checklist of things that need to be completed may help relieve you or a loved one of some of the stress in a very trying time.

Collect important documents
These include birth and marriage certificates; military discharge papers; bank, retirement plan and investment account statements; real estate deeds; Social Security card; mortgage and other loan documents; credit card statements; insurance policies and multiple original copies of the death certificate.

Contact Social Security
Notify the Social Security Administration of the death, and check to see what benefits may be available to the surviving spouse and any minor children.

Itemize assets, income and debts
Review liquid assets — cash on hand, money in the bank, life insurance death benefits — to determine the amount of money readily available to meet expenses. Additionally, review your investments, list your financial obligations and your prioritize bills. And if necessary, call creditors to work out payment schedules.

Update surviving spouse's beneficiaries
Check life insurance policies and retirement accounts to update or  change the beneficiary designations if necessary.

Retitle joint bank and investment accounts
Contact your financial institutions to update their ownership records.

Contact spouse's employer(s)
Find out if any unpaid salary or commissions or employee benefits - life insurance proceeds, pension benefits, accrued vacation and/or sick pay, leftover funds in a medical flexible spending account, etc. - are payable. Ask whether existing health insurance coverage can be continued (if applicable) and for how long, and find out the cost.

Check insurance needs
Start researching health insurance options to find the most affordable option, especially if existing coverage won't be available going forward. Consider buying additional life insurance, especially if there are children to support, and a disability policy as well.

Get assistance
TCU Trust Services is here to assist. We would be happy to sit down with you and discuss your own situation and needs. Don't try to go it alone.
For more information, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

Trust services available through MEMBERS Trust Company, 14025 Riveredge Drive, Suite 280, Tampa, FL 33637, a Federal Thrift Chartered by the Office of Thrift Supervision. This is for educational purposes only and is not intended to provide legal or tax advice regarding your situation. For legal or tax advice, please consult your attorney and/or accountant.

Leave Your Estate - Not Problems - to Your Family

Closing up any gaps in your estate plan can help ensure your surviving family will not face unnecessary difficulties when settling your estate and your assets will be distributed as you intended.

Keep Documents Current
A will is the foundation of an estate plan. Yet some individuals never get around to writing a will - or they create one but let it become outdated. For example, they may not change it after a marriage, a divorce, or the birth of a child. Or the will may name an executor (or personal representative) who either refuses to serve or is unable to do the job well.

The way your assets are titled is also important. For example, life insurance proceeds become part of the policy owner's estate. Having someone else (or a trust) own the policy can keep the insurance money out of your gross estate for estate-tax purposes.

Although their family situation changes, many individuals do not change the beneficiary designations they have made for their 401(k), IRA or other retirement assets. Simply reviewing your beneficiary choices periodically and making any necessary revisions can prevent potential estate problems.

Address Electronic Information
What would the consequences be if, after your death, no one could access the information you have stored electronically? If you have protected your accounts or files with passwords, it could easily happen. Personal email, address books, and financial information are also at risk of being lost if you have not shared passwords or designated someone in your will to have access to the records. Consider revising your estate planning documents to include passwords and authorize access to your online and other protected computer data. In addition, plan for the disposal or transfer of digital assets just as you would for tangible assets.

Follow Up
Once you have a plan in place, it is important to follow through on it. For example, as part of your planning, you might decide to create a living trust. But securing the advantages of the trust requires completion of the trust arrangements, including the transfer of assets to the trust. Unfortunately, individuals sometimes create a trust but, for one reason or another, do not take the final funding step.

Your personal and financial situation will likely change over the course of time. By reviewing your estate plan on an ongoing basis, you can ensure that it is up to date.

For more information please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.


 

The Ten-minute Review

 

Making time to think about your estate plan probably is not high on your to-do list; but, maybe it should be. Your estate plan may no longer be able to accomplish your goals, if your financial or family circumstances change. That possibility makes it a good idea to take some time to review your plan. Start by asking yourself some simple questions.

Has the size of your estate changed?
Has your net worth changed substantially? Make a quick estimate. If the total value of your assets has changed greatly, you may need to make some adjustments.

If your net worth has grown, federal estate tax may be more of an issue than it had been before. The amount you can pass estate-tax-free to your heirs has increased under recent legislation, but the federal estate tax remains a threat for large estates.* Up-to-date tax planning to reduce potential taxes is as essential as ever.

A substantial increase (or decrease) in the size of your estate could also affect the distribution of your assets, particularly if you have made specific bequests to individuals or charities, rather than dividing your estate proportionately.

Are your contingency arrangements up to date?
Are you comfortable with the individuals you named in your health-care proxy and durable power of attorney? Are those people still willing to serve in those capacities? You can confirm your choices or identify the need for changes with a quick review.

Will your assets be distributed as you wish?
If there have been deaths, births, divorces or disabilities in your family, you may want to change your will. A change also may be in order, if you have concerns about a loved one's ability to handle an inheritance.
You can delay or set conditions on when a beneficiary will gain access to his or her inheritance, by creating a trust in your will. By naming an experienced professional as trustee or co-trustee, you can ensure that the trust assets will be reliably managed and your beneficiaries will be provided for according to your instructions.

Are the needs of your minor children covered?
If you have minor children, make sure the guardian you named in your will is still the person you want for the job and they are still willing to serve. Also, you may want to consider separating financial responsibility from day-to-day care. Many estate plans name a family member to provide care for minor children and a professional fiduciary to provide financial management until the minors reach maturity.

Have you funded your trusts?
Sometimes, individuals create trusts for good reasons, but they do not complete the arrangements by transferring assets into the trusts. Have you followed through by funding your trust? If your present plan needs updating, we can help. Our experienced professionals can suggest effective strategies for achieving your estate planning goals. Please contact us if you want to discuss your needs. 

For more information please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

*The estate-tax exclusion amount is $5.12 million in 2012. Absent further legislation, a significantly lower exemption amount - coupled with a higher maximum tax rate - is scheduled for 2013.

 
 
 

Who is Your Personal Representative?

 

Many of us have a family member or friend whom we trust and can count on to do the right thing. Consequently, it is not surprising that we might be tempted to pick someone close to us to serve as executor (or personal representative) of our estate. It is a vote of confidence in the friend or family member. But, it is also a tremendous responsibility.

When You Are Chosen as Executor
If someone has selected you to settle his or her estate, you may be overwhelmed by the time and effort required to do the job properly. You may find it difficult to take time away from your business or personal life to devote to the administrative and asset management tasks executors must perform. If you would like assistance with the tasks involved in settling the estate, we can help by serving as your agent. As a professional fiduciary, we know the ins and outs of estate administration and asset management. And, we can make the settlement process easier for you.

Here is a list of items typically required to settle an estate:

  • The original will of the decedent
  • Multiple copies of the death certificate
  • The Social Security numbers of the decedent, surviving spouse and children
  • Medical bills, funeral expenses and other bills payable after the decedent's death
  • List of estate assets and liabilities
  • Account statements and numbers of all credit union/bank, brokerage, IRA or other retirement accounts
  • Stock certificates and bonds
  • Life insurance policies
  • Designated beneficiary forms for retirement accounts and life insurance policies
  • Deeds to real estate
  • Information on any safe deposit boxes
  • Trust agreements
  • Partnership agreements
  • Income-tax returns for the last three years
  • Lifetime gift-tax returns
  • Names and contact information for the decedent's Accountant, Attorney, Financial Planner, Insurance Agent and other professionals
  • Names and contact information for family members

    Let Us Help
    As you can see from the list above, an executor must attend to numerous details. As estate settlement professionals, we have the resources and the personnel to attend to the smallest details necessary to settle an estate. We will be happy to explain what we can do to minimize your work and help you settle the estate in the most effective manner possible.

For more information, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

 
Is a Revocable Living Trust Right for You?
You've probably seen the advertisements touting the creation of a revocable living trust as a good way to avoid probate. And for some people it is. However, it may not be appropriate for everyone or for every situation.
Probate is a court-supervised proceeding that can betime consuming and expensive. That's why the big advantage of a living trust is that its assets don't go through probate.
 

 

Disability Protection
Living trusts are also very good mechanisms for managing your finances if you should ever become disabled. You can set up a living trust, transfer your assets to it but keep full control by naming yourself as trustee, and also name a reliable co-trustee, such as your adult child. Your co-trustee will be able to manage the trust assets for you if that ever becomes necessary. On the other hand, creating a durable power of attorney can also be an effective way to provide for management of your assets if you become disabled.
 

You'll Still Have To Pay Taxes
Revocable living trusts don’t save taxes. You'll still have to pay income taxes on income earned by the trust assets. The trust property will be included in your gross estate, too.
 

Creditors May Still Pursue You or Your Estate
Another misconception about a revocable living trust is that it can protectyour assets from creditors. In fact, you can be sued and lose your property whether you own it inside or outside of a revocable trust.
 

Cost Benefit Analysis
In many states, probate is not a very expensive or difficult process. And, while living trusts help avoid probate costs, they have costs of their own,including legal fees and administrative costs (and paperwork, too). Unless your estate will be very large, the potential probate cost savings may not exceed the costs of creating and administering the trust.
 

Titling and Beneficiary Designations
Some of your assets, including property that’s owned jointly with right of survivorship and retirement plan savings and life insurance payable to a named beneficiary, are already probate-proof. Such assets will pass automatically to their new owners on your death.
 

You Make the Call
Creating a revocable living trust may be a good decision or it may not. Only your specific financial and family circumstances can determine the answer.

For more information, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

 

Living Trusts and Taxes


Perhaps you've read about an estate planning tool called a living trust. It's often recommended to individuals who want their assets to be professionally managed should they become disabled. A properly implemented living trust also avoids probate, which can be a time-consuming and expensive process.

As its name implies, a living trust is created during a person's lifetime rather than by will. Typically, the person who creates the trust not only benefits from the trust, but also reserves the right to revoke it and may serve as the initial trustee or co-trustee. Therefore, while the trust may provide planning advantages, the trust creator still effectively controls the trust assets. For this reason, a revocable trust has little impact on the trust creator's tax situation.

Income Taxes
The trust creator generally continues to report and pay taxes on income from assets transferred to the trust on his/her personal tax return. If a charitable contribution is made from the trust, the trust creator may deduct it (within tax law limits). Generally, the trust itself is not subject to income taxes.
 
Gift Taxes
Even though another beneficiary (a child, for example) may one day benefit from the trust, the transfer of assets to the trust is not considered a taxable gift.

Estate Taxes
Unlike some other types of trusts, a revocable living trust does not save estate taxes. The trust assets must be included in the trust creator's gross estate for federal estate-tax purposes.
For more information, please call Meg Loitz, TCU Trust Officer, (574) 245-4735 ext. 5153 or Chris Eberly, TCU Trust Officer, (574) 936-8926 ext. 5672.

Trust services available through MEMBERS Trust Company, 14025 Riveredge Drive, Suite 280, Tampa, FL 33637, a Federal Thrift Chartered by the Office of Thrift Supervision. This is for educational purposes only and is not intended to provide legal or tax advice regarding your situation. For legal or tax advice, please consult your attorney and/or accountant.
 

 

 
 
 
 

 

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