A Few Thanksgiving Thoughts
In this issue, instead of one long story cover article, we thought it appropriate to share with you some personal reflections on Thanksgiving from several of our firm’s members.
My childhood Thanksgiving memory has always consisted of my beautiful mother preparing a couple of weeks in advance, for our lavish Thanksgiving meal. She would plan and buy everything she needed typically a week or two before. I would always try to help… but she would never let me lift a finger to do a thing. Thanksgiving was always her favorite holiday. On Thanksgiving morning, I can vividly remember waking up to the house smelling like heaven. The mixed smell of turkey, ham, stuffing, mashed potatoes, gravy, corn, greens, macaroni & cheese, cornbread, pies, & much more was absolutely amazing! I would anxiously wait to see what she had in the oven. Typically, by the time I woke up, my Mom would be working on her side dishes and her main meal was already on route to being done, if not done already. She was our family’s miracle worker. None of us (my brother, sister, and I) would ever really know what time she slept or even if she slept at all the night before.
We would spend the rest of our late morning and early afternoon getting ready for our family and friends to come over and enjoy our great home cooked meal. What I remember most of my childhood Thanksgiving was feeling like my heart was filled with love and my stomach was full of homemade goodness. My Mom’s meals were always so delicious. My Mom literally would outdo herself every year. Fortunately, we had many beautiful years of Mom’s Thanksgiving. Today, I do most of the cooking. My Mom, unfortunately, has dementia and is unable to cook for us like she once did. I’ve learned to appreciate my Mom now more than ever. I look forward to making our family’s Thanksgiving meal and can only hope to be half as good a cook as my Mom once was.
I’ve previously written about my childhood experience of Thanksgiving, growing up in a small town America. (If you haven’t read it click here.) So I wanted to write something different this year, but wasn’t sure what. I spent over two hours in my car, driving home from a weekend vacation, yet in all that time I still couldn’t come up with anything. So I stopped my car and went into a small café to get something to eat and hopefully refresh myself and my thinking.
While I stood at the counter, waiting for my order to be delivered, I started to feel a pain in my legs, no doubt due to sitting cramped up in the car for so long. I began to stretch my legs and, as I did, I noticed I was about to hit the person seated at a table behind me. When I turned to be sure I had missed her, I saw that she had no legs and was sitting in a chair at a table, with her wheelchair beside her. She then pulled herself up into the wheelchair, went over to the condiment stand, brought some items back and moved herself out of the wheelchair and back into her seat. She did this all very quickly and matter-of-factly. Right then and there, I realized that the pain in my legs was inconsequential and minor in comparison to the many challenges and pains others confront every moment of every day. And the pure and simple message of Thanksgiving came to me, loud and clear — to share with you here, how much all of us should be incredibly grateful and thankful for our health and the many other blessings we enjoy daily and too often take for granted.
Every year my family & I spend Thanksgiving with my four older sisters and 22 nieces and nephews of every age group. The kids play outside, and the men sit in front of the television or run errands, while the rest of us make sure the food is cooking! Each of my sisters brings a cooked turkey, or ham and we prepare a large pot of mashed potatoes & gravy, plus vegetables, salads, and so much more food. The adults sit at the large family table, teens at one table and toddlers at another. We all sit around eating, enjoying each other’s company, talking and laughing.
After dinner and dessert, we ALL participate in a dance off from the Xbox’s “Dance Central” (we have a good laugh watching everyone’s dance moves!) After this, the older teens get together and head to the Black Friday specials, while my sisters, their husbands & I get together, enjoy a few drinks and play family board games. My sisters and I are very close, we enjoy spending family time together, and this is a holiday tradition we hope our children will continue too.
My entire family and I do not really celebrate Thanksgiving. It’s not because we are not thankful but because we already gather our large family multiple times a year and we are always thankful in those moments. We already gather for all birthdays big and small, Mother’s Day, Father’s Day, Valentine’s, during playoff seasons in varies sports, Easter, 4th of July, varies ceremonies (like weddings, baptismal and sweet 15’s), Halloween, Christmas and New Year’s!
However, I do have a unique Thanksgiving story to share. I remember there was one year that I spent it with my sister and her now in-laws. I remember my sister had given her then boyfriend an ultimatum and a date by which he had to propose to her. His family invited my brothers and me to join them at their Thanksgiving dinner. Before the dinner started, he sent my sister and his sister to buy some drinks. When the girls left to the store, he pulled my brothers and me aside and told us that he was planning on proposing to her soon and asked that we help out by not telling her while he made the final arrangements to do so. But somehow his proposal didn’t happen that day and the “drop dead” date that she gave him passed, so she broke up with him. She was a little heartbroken but I kept telling her that he loved her and that she might just be surprised of how much he did. Shortly thereafter, he called her, took her out to dinner and proposed. After he proposed, she asked me if I already knew that he was going to do it. I told her that I did and that was the reason I kept telling her to have patience. And now, at this year’s Thanksgiving, I’m thankful she did, because they are a happily married couple and have two beautiful girls!
Estate Planning Pitfalls
/’pit,fôl/ noun: pitfall: a hidden or unsuspected danger or difficulty. Synonyms: hazard, danger, risk, peril, difficulty, catch, snag, stumbling block, drawback.
A hidden danger sounds pretty serious doesn’t it? But we know they are out there. Pitfalls on the roads, pitfalls in our careers and even pitfalls in our estate planning. Many of these are just a matter of personal, basic due diligence – updating your information and making sure your estate planning attorney is aware of changes in your life.
For example, an easy one to avoid is designating beneficiaries or transfer on death designations that are in conflict with your estate planning objectives or that do not take into consideration income tax consequences. Keeping your beneficiary designations current is vital to the success of your estate plan. Likely, many of your assets will usually pass by method, such as life insurance, annuities, IRAs and tax-deferred benefits. In addition, the nonprobate transfer laws of many states provide for “pay on death” or “transfer on death” designations. Consequently, you may designate beneficiaries for bank accounts, CDs, stocks and other assets. While all of this is great news, remember to heed the advice of your estate planning attorney when designating a beneficiary. Why? Because an inconsistent designation could possibly present an issue and cancel out the distribution plan you created in your will or trust. If this happens, any asset protection or tax planning built into your legal documents might also be short-circuited.
Joint Ownership of Your Bank Accounts
Adding a child as joint owner on your bank accounts as a “convenience” is a common temptation, especially in you later years. Resist the temptation. It can backfire with unintended consequences. For example, do you really want your assets subject to the divorce, lawsuit and bankruptcy of your joint tenant? By the way, the more joint tenants you add, the greater your risk. Also, when you die, the assets held in joint tenancy will pass directly to the surviving joint owner (or owners) and potentially disrupt the plans you had for the distribution of your assets under your will or trust.
Naming one child as trustee over his or her siblings? When has this ever been a good idea? Siblings have been known to fight, and that only intensifies when their spouses are involved. Avoid unnecessary tension between siblings, as there already may be hard feelings over perceived preferential treatment over the years. Consider appointing a disinterested third party to deal with this and avoid some strife. After all, you will not be there to put the offending parties in “time out” or “send them to their rooms,” if necessary.
Considering Special Needs
Failing to adequately plan for individuals with special needs or disabilities can be a huge oversight. You do not want to leave an outright inheritance to a loved one with special needs or a disability. Why? The inheritance itself could negatively impact the current or future eligibility of that loved one from receiving public assistance benefits to which they are entitled. And, if they do receive public assistance, then the inheritance may be required to reimburse the state instead of passing to your other family members. This is not a do-it-yourself project. Your estate planning attorney can help create a special needs trust or supplemental needs trust to “own” the inheritance in a trust rather than being owned by your loved one with special needs. The inheritance will be managed by an independent trustee who provides benefits as specifically described in the trust agreement.
Review Your Estate Plan
Failing to review your estate plan on a regular basis can be a major pitfall, but you likely will not be around to see the train wreck. Ideally, you should make it a habit to visit with your estate planning attorney about every two years, or whenever there is a change in your life, the lives of your loved ones or in your financial situation (e.g., retirement).
Are Reverse Mortgages Wise For Seniors?
It would be wonderful to give you an absolute yes or no, but like so many things, it is important to analyze how your specific circumstances factor into the answer.
A Reverse Mortgage is a Special Type of Home Loan
Have you seen any of those infomercials promoting the wonders of reverse mortgages? So, should you sign on the dotted line?
First, remember that a reverse mortgage is a special type of home loan. Think conventional mortgage … only in reverse. A reverse mortgage lets the homeowners (borrowers) take a portion of the equity in their home and convert it into cash to supplement their cash flow or other uses. Basically, the equity that has been accumulating through the years is paid to the homeowners.
Unlike a traditional home equity loan or second mortgage, a reverse mortgage does not require the homeowners to repay the loan until they are no longer living in the home as their principal residence, they pass away or until a time when they do not meet their mortgage obligations. A reverse mortgage can be applied to the purchase of a primary residence, provided the homeowners can make up the difference between the amount of the reverse mortgage and the purchase price of the property to be purchased.
Making an Informed Decision
So, is a reverse mortgage a good thing for a senior citizen?
In many instances, a reverse mortgage can be very advantageous, but again homeowners should make an informed decision. Look before you leap. Sit down with your team of advisors – your estate planning attorney, financial advisor and accountant. You will want to “run the numbers” and look at all sides of the issue, especially tax and estate ramifications.
The law says that if you are 62 years of age or older, you can sign a reverse mortgage.
The amount of money the homeowners can borrow is based on the equity he or she has in the home, his or her age and the applicable interest rate. Generally speaking, the older the borrower, the more they are able to borrow. Experts typically advise senior clients that a reverse mortgage can be advantageous if they are “cash poor” and “equity rich.” The value in their home can help them pay their monthly debts and obligations. A reverse mortgage can give the homeowner a guaranteed source of income, tax-free, for the rest of his or her life. The best part of a reverse mortgage is that the homeowners get to continue living in their own home. Nonetheless, there are closing costs and potentially higher rates of interest. In addition, a reverse mortgage can wipe out the equity in the home and significantly impact inheritances intended for your loved ones.
Make the Right Move
A reverse mortgage can be just the ticket, but you should make sure you know where you are going. Do not sign on the dotted line until you get some sound advice regarding whether this is a good move for you.