Long-term planning is the key to being prepared for retirement, and unfortunately a large percentage of people find this out the hard way. However, even if you do plan ahead intelligently, things can sometimes take place that you could not anticipate.

A good case in point would be the financial meltdown that we experienced in the United States a few years ago. This set back many people who were planning for retirement.

If you were to find yourself short of liquidity late in your life for one reason or another, one option available to you would be to take out a home equity conversion mortgage. These are reverse mortgages that are backed by the federal government, so they are legitimate but there are costs involved.

Under a reverse mortgage, you receive payments from a lender and the lender obtains equity in your home in return. There are no credit or income requirements because no payments are expected of you. You do have to be at least 62 years of age, you are required to keep the home in good repair, and of course you must have significant equity in the home.

The loan becomes due and payable when you die or when you move voluntarily. A lot of people will sell the house to pay off the reverse mortgage, but you don’t have to do this if you have the means to satisfy the lender in some other way.

Planning for retirement and preparing a thorough estate plan are essential.  Should you be interested in discussing your estate plan with a professional, take action right now to set up an appointment with a certified and experienced Campbell, California estate planning attorney.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

There have been a handful of professional sports franchise owners that have become synonymous with the teams that they owned. Without question, one of these is the late Al Davis.

Davis was the longtime owner of the Raiders.  He passed away at the age of 82  on October 8th of last year.

Al Davis was the majority owner of the Oakland Raiders even after having divested himself of part of his share of the team a few years before his death. The value of the Raiders is well in excess of $700 million and reports have indicated that he passed away owning just under half of the club.

The estate tax rate was 35% last year as it is this year, and the exclusion when Al Davis passed away was $5 million.  So Al Davis was holding over $300 million in assets via his share of the Raiders with only $5 million of this being exempt. That is quite a big tax bill and many families who were in this situation would be forced to sell the team to pay the estate tax.

As it turned out, Al Davis planned his estate carefully so that his wife Carol and son Mark could retain the majority ownership share of this team that meant so much to him.

You may not own a professional football franchise, but you may in fact own a business that means as much to you as the Raiders meant to Al Davis. If you want to take steps to keep your business in the family after you pass away, the wise course of action is to discuss the matter with a licensed and experienced San Jose estate planning attorney.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

Members of the elder law community are becoming increasingly concerned about the high and rising cost of long-term care.  People are living longer than ever before, with the oldest among us being the fastest growing age group. Most people who reach senior citizen status will indeed need long-term care at some point in their lives, therefore this is something that is relevant to all of us.

It is important to understand the fact that Medicare does not cover long-term care costs. With this in mind, careful long-term planning is essential, especially in light of just how high these costs have become during our current era.

Every year the MetLife Mature Market Institute puts out a survey that breaks down the costs associated with long-term care. The 2011 figures are in and the latest survey has been released.

In 2011, the average daily charge for a private room in a nursing home in the United States was $239 (in California, the average daily charge was even higher at $301).  In 2010, this number was $229, so this is a national 4.4% increase. If you multiply this number by the 365 days in a year, you’re looking at an annual national average expense of $87,235 ($109,865 in California).

The cost of a month-long residence in an assisted living community in the United States in 2011 averaged $3,477 (in California, this average figure is even higher at $3,838 per month).  This represents a 5.6% increase over the $3,293 that was the national average for 2010. Annually, this works out to $41,724 (in California, the annual average is $46,056).

The cost of long term care is considerable. Preparation is key, and if you would like some professional advice regarding how to pay for long-term care, arrange for a consultation with a qualified and experienced elder law attorney.  Our offices are located in Campbell, California and Aptos, California and we can be reached at (408) 356-9200 or (831) 476-2400.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

Different individuals have different needs when it comes to devising an estate plan, and this is why it is important to receive personalized attention from a professional when you are making preparations for the future.

There is no “one-size-fits-all” estate planning strategy. This is something to keep in mind if you happen to run across websites claiming that you can plan your own estate by filling in the blanks on a generic document.

One of the situations that can call for specialized attention is that of small business succession. If you are a partner in a small business, you have to arrange for the transfer of your business share to your loved ones.

You may want to take the value of this share and distribute it among a number of different people. As a result, you’re going to have to take steps to liquidate your share without acting in a way that can negatively impact your surviving partners.

This can be accomplished by all the partners entering into a buy-sell agreement. One type of buy-sell agreement is called the cross purchase plan.  The way a cross purchase plan works is that each of the partners would take out a life insurance policy on the other partners. Should one of the partners pass away, the combined policy proceeds are utilized to purchase the business share that was owned by the deceased partner from that deceased partner’s heirs.

If you’re interested in learning more about buy-sell agreements and other small business succession strategies, take action right now and arrange for a consultation with an experienced and professional Santa Clara County estate planning lawyer.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

You see a veritable alphabet soup of acronyms referenced when you delve into the topic of estate planning. We like to take a look at some of these acronyms from time to time in an effort to demystify the terminology. With this in mind, we would like to highlight the ILIT or Irrevocable Life Insurance Trust.

The federal estate tax looms large when you are planning your estate. At the current time it is carrying a 35% rate, and this rate is scheduled to rise to 55% at the end of the year. Clearly, this levy can erode your legacy significantly and if you are in fact exposed to the estate tax, you must take steps to gain estate tax efficiency.

Life insurance proceeds are subject to the estate tax if the overall value of your estate exceeds the exclusion amount. As a response, you may want to place your life insurance policies into an irrevocable life insurance trust. Since the policy assets are directed into the ILIT,  you don’t technically own them when you pass away so the beneficiary of the ILIT is not required to pay the estate tax.

If you designate your ILIT beneficiary as your spouse, you can designate your children as secondary beneficiaries. In this manner, they could benefit from the trust after the death of your spouse without incurring any estate tax liability.

For a more detailed explanation, simply take a moment to arrange for a consultation with a licensed and experienced Campbell, California estate planning attorney.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

The legendary New York Yankee Mickey Mantle once said, “If I knew I was going to live this long, I would’ve taken better care of myself .”

You can extract a lot from this sentiment when you are thinking about your future. It can be hard to envision yourself as a senior citizen, but if you do not make plans you may find yourself unprepared if you live to a ripe old age.

Mickey Mantle only lived to the age of 63, but these days people are routinely living into their mid-to-late 80′s and beyond.  As you reach an advanced age, the possibility of incapacitation becomes very real.

In excess of 40% of people who are 85 years of age and older are suffering from dementia, and this is largely due to the prevalence of Alzheimer’s disease. If you were to become unable to make decisions due to dementia, a guardian could be appointed by the court to make your financial and health care decisions.

To circumvent this possibility, you could take action in advance by executing documents called durable powers of attorney.  These powers of attorney remain in effect should the grantor become incapacitated. With these documents, you designate representatives to make medical and financial decisions on your behalf should you become unable to do so.

Incapacity planning is one of the core elements of a comprehensive plan for aging. If you have not yet executed your durable powers of attorney, right now would be a good time to take action and arrange for a consultation with an experienced San Jose area estate planning attorney.  My office also offers free estate planning seminars and workshops and I encourage you to view the seminars section of our website for more information on upcoming events.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

There are certain responsibilities that go along with being a self-supporting adult. This is true for everyone, but it is especially important for people who have others depending on them.  For this reason, the myth about estate planning only being relevant to the elderly is truly misleading and inaccurate.

In a very real sense, it is more important for younger people to have an estate plan because they are more likely to have dependents still living in the home. If you want to do right by those that you love, you should have a vehicle of income replacement in place, as well as a Will or a Trust and advance health care directives asserting your wishes with regard to medical procedures.

According to a Harris interactive survey that was conducted among 1,022 American adults late in 2009, only 24% of the participants who were under the age of 35 had executed any estate planning documents at all. And even older Americans were surprisingly unprepared, with 23% of respondents over the age of 55 acknowledging that they didn’t have any sort of estate plan in place.

The reality is that there is no excuse for procrastination because the stakes are so very high. While it is understandable that a lot of people don’t know where to begin, there’s a simple solution. All you have to do is pick up the phone and arrange for an appointment with an experienced Campbell, California Estate Planning attorney who will assist you as you craft an estate plan that protects your family while ensuring your legacy.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

Creating a Will as your estate planning device can lead to Will challenges, and can also lead to conflict among the people that you loved if your decisions do not appeal to all interested parties.  It can also leave your beneficiaries open to financial predators because Wills must be filed with the Court and become a matter of public record. Therefore, information regarding any inheritance you pass on to your loved ones via that Will can be obtained by the general public.

Of course, you do not have to use a last Will as your primary vehicle of asset transfer, and some of these concerns can be circumvented if you select an alternative estate planning device.

A Will must pass through the legal process of probate, and during this time the probate court examines the Will to determine its validity. If it is in fact deemed valid, the court will supervise the administration of the estate.

If someone wants to challenge a Will, they present their argument before the probate court.  Additionally, whether the Will is challenged or not, the details and administration of the probate are a matter of public record.

Most people would prefer that their decisions remain confidential, and of course nobody wants to see their final wishes challenged. Avoiding probate is a way to ensure privacy and make any challenges less likely.

Should you be interested in exploring probate avoidance strategies in an effort to keep your final affairs away from prying eyes, take a moment to arrange for a consultation with a qualified San Jose Area Estate Planning lawyer.  We also invite you to attend one of our free living trust seminars.  For more information, visit the Seminars section of our website.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

It is a discouraging elder law statistic that over 60% of the people who receive Social Security say that it is their primary source of income. 

The United States Social Security Administration has recently stated that the average monthly benefit is around $1,080.  Monthly income in this range is not going to get you far, and Social Security clearly has its limitations even if you are receiving more than the average.  If it appears like you will be relying on Social Security heavily during your retirement years, you may want to do everything possible to maximize your benefit.

This can be done by continuing to work beyond your full retirement age. You are allowed to delay your Social Security application until you are 70 years of age. Your benefit increases by 8% for every year that you work beyond your full retirement age.

In addition, you may earn more during these last years than you did at other times during your working career. Your top 35 earning years are used to calculate your benefit so these last years could replace previous years during which you made less and your benefit would be greater as a result.

To gain a more in-depth understanding of Social Security as you devise a plan that leads to a comfortable retirement, simply take a moment to pick up the phone and arrange for a consultation with a licensed and experienced Los Gatos area Estate Planning attorney.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.

The lives of celebrities are an open book due to the feeding frenzy of the gossip and entertainment media.  Some of the information that is circulated is of the tabloid variety that really doesn’t provide you with much more than a bit of entertainment. However, sometimes you read about actions taken by celebrities that can be instructive, and the estate planning efforts of the late British singer Amy Winehouse is a good example.

Winehouse was just 27 years old at the time of her death last year, and her untimely passing stunned the music industry. It is no secret that Winehouse lived and played hard, so observers rightly wondered if she had her financial house in order when she passed away.

The British newspapers report that Amy Winehouse did indeed take the necessary steps to assert her final wishes in a legally binding manner. She left her assets to her father, her mother and her brother.

Amy Winehouse had been married to Blake Fielder-Civil and she reportedly made a point of revising her estate plan after divorcing from him. Under British law, it would have been possible that he could have been in line for an inheritance had she not been proactive about asserting her wishes.

Life changes such as divorce and remarriage generally require estate plan updates. If your estate plan is currently in need of revision, you may want to take action sooner rather than later and arrange for a consultation with an experienced San Jose area estate planning lawyer.

We also invite you to read our free reports, The Impact of Divorce on Your Estate Plan, Planning it Right the Second Time Around, and Living Trusts, Calculating the Benefits.

The Law Office of Roy W. Litherland is a member of the American Academy of Estate Planning Attorneys.