Pop the popcorn, uncork the champagne, and put on your best red-carpet duds to tune into the 92nd Academy Awards tonight! In between award envelopes and amazing performances, consider how your 2020 Oscar ballot has some surprising connections with estate planning. It may sound like a stretch, but hear me out while you watch the pre-show coverage.

Anything Could Happen

If you’re a film buff who has managed to watch all nine of the Best Picture category nominees (first off, I’m jealous), you may have a strong opinion about which one deserves to win. However, just like life, anything could happen! You may bet that 1917 most certainly will be victorious, but in the end, You know one of the films will win, just like you know someday you’re going to pass away. However, you cannot know which one of the films will win ahead of time, just like you cannot know how and when your final scene will be.

Expecting the unexpected is what estate planning boils down to. With something fun and entertaining like the Academy Awards, surprises can make for ready Oscar party fodder. But, when it comes to your estate—all of your assets you worked hard to acquire—surprises can make for frustration and confusionin fighting for your family, extended probate time and fees, and assets being distributed in a way that you wouldn’t have chosen.

Estate planning allows you to make certain your loved ones and the charities you care most about “win,” regardless of when you pass away.

It’s All in the Family

Some of the films nominated this year have familial relationships as a central plot device in the scripts. For instance, the Greta Gerwig take on the Louisa May Alcott classic, Little Women, explores the relationships between four sisters, each unique in their talents and interests, from childhood through young adulthood.

The scenes of Jo, Amy, Meg, and Beth remind us that people are considered minor children until they turn 18, and parents should have guardianship defined through their estate plans. That way, if something were to happen to the minor’s legal guardian(s), they could be immediately placed under the care of another trusted adult. Unless guardianship has been established, the Iowa Courts must choose guardians for the minor child if the legal guardian died or was incapacitated. Unfortunately, with no clear choice as to what the former caregivers would have preferred, the Court must basically make its own and best determination as to who the parent(s) would have preferred and what would be in the best interest of the children. The Court may or may not, choose who the parent(s) would have actually named.

Leave a Lasting Legacy

Some of the greatest films of all time have won the “Best Picture” category and left a cinematic legacy that has lasted well beyond their premiere date. These movies and the stories they tell live on in infamy, as generation after generation experiences their contribution to the entertainment industry. Indeed, the plot of the nominee Ford v Ferrari explores what kind of lasting reputation a team can build in their attempt at besting the dominator of the day.

Perhaps one or more of the 2020 Best Picture nominees will join this upper echelon of cinema (and maybe not), but estate planning also allows you to also make a mark on your world—a chance to leave a lasting legacy. A legacy can be interpreted differently by different people. A legacy to you could mean leaving a sizable charitable bequest to your church or alma mater. It could also mean bequeathing your art collection to your favorite museum. It could mean establishing college funds for all of your children and grandchildren to represent your belief in continuous learning. Whatever you envision your legacy to be, an estate plan will allow you to shape it…think of it as your own star on the Hollywood Walk of Fame!

hollywood walk of fame star

Retain Your Control

Power is a common theme in some of the films nominated this year. Whether it’s the Joker with its implicit theme on how the power of kindness can change the cycle of bad events for someone or De Niro in The Irishman detailing the inner politics and power grabs of the mob, there is something to be said for retaining control over your assets. I like to tell my clients that estate planning really just allows you to direct who inherits what, when, and how. For most folks, they want to choose where their hard-earned property goes, not the government via Iowa’s intestacy laws.

I’d love to hear your take on films nominated this year, but I’d also like to discuss your estate plan! Don’t hesitate to contact me via email or by phone (515-371-6077). You can also get started on the creation of an estate plan by filling out my free, no-obligation Estate Plan Questionnaire.

love in lights

Valentine’s Day is coming up quick and while I think the commercialized messages of “this is love” can get a little cheesy, I’m a full supporter of a day that celebrates love. Be it love for your spouse, a celebration of the fact that you are awesome, or showing even more adoration for your furry best friend, the world could always use a little more love. In this important addition to the #PlanningForLove series, let’s talk about ways you can show love to your children through your estate plan.

I’ve discussed the importance of guardianship quite a bit on this blog. It’s important that anyone with minor children establish guardianship so that if something were to happen to you as a legal guardian that your minor children (under age 18) would be immediately placed in the care of someone you know, trust, and most importantly, choose. Just as establishing guardianship is a powerful gift that your children will hopefully never have to actually know about or experience, a testamentary trust can also continue to provide and support your children if something were to happen to you.

There is an almost endless number of different kind of trusts and you can put just about any asset in a trust. Testamentary trusts are one of the most common kinds of trusts I establish for my clients. You may recognize the first word of the type of trust from “last will and testament.” Indeed, a testamentary trust is a trust written into your will and provides for the distribution of a portion or all of your estate.

Sounds simple enough, but you’re thinking, “What does this have to do with my kids?”

Different from an inter vivos trust, which is established during the settlor‘s lifetime, the testamentary trust kicks in at the completion of the probate process after the death of the person who has created it for the benefit of their beneficiaries.

Typically testamentary trusts are created for minor children or others (such as a relative with some kinds of disabilities) who may inherit a large amount of money if you (the testator) were to pass away. The general thinking is that you may not want a minor child, or even a young adult, to have uninhibited access to their inheritance until a certain age (and presumed level of maturity) is reached. (I can imagine what I would have done with an inheritance at, say, age 18 and it surely wouldn’t have been the smartest use of money!) The testamentary trust then terminates at whatever age you choose, at which point your beneficiaries receive their inheritances outright and can use the funds in any way they choose.

child with red heart

The testator can choose the distribution to be distributed in percentages such as 25% at age 18, 25% at age 22, and the remaining 50% at age 25. Or, the trust funds may be distributed in full at a single age. (All at age 25 is the default if the testator doesn’t choose otherwise.) Distributions can also be made immediately upon your passing if all beneficiaries are legal adults (age 18 or older). The testamentary trust could also be set-up for disbursements around milestones, such as a percentage or full disbursement when the beneficiary graduates from an accredited two- or four-year college institution.

Testamentary Trustee

With a testamentary trust, you also need to designate a trustee. The trustee is responsible for managing the trust property according to the rules outlined in the trust document and must do so in the best interests of the beneficiary (for example, a minor child). Generally, I advise the appointed guardian also be the trustee of a child’s testamentary trust.

Testamentary Trust Options

In my Estate Plan Questionnaire, I offer clients three main options for testamentary trust organization. (Note that there can be more than one testamentary trust created in one will.)

  • Option 1: Separate trust fund for each beneficiary. Each beneficiary’s inheritance to be held by the trustee in a separate fund. Whatever is left in each beneficiary’s trust fund, if anything, will be distributed to that beneficiary when they attain the age(s) indicated in the following section. This option ensures that all of your beneficiaries are treated equally, regardless of needs.
  • Option 2: Single trust fund for multiple beneficiaries. The entire inheritance will be held by the trustee in a single trust fund for the benefit of multiple beneficiaries (such as multiple children). The trustee may make unequal distributions during the term of the trust if a beneficiary needs additional assistance. Whatever is left in the trust, if anything, will be distributed equally when your youngest beneficiary attains the age(s) indicated in the following section. This option will allow the trustee to accommodate a particular beneficiary’s needs by distributing more of the inheritance to that beneficiary during the term of the trust. (Recommended with younger beneficiaries.)
  • Option 3: No delayed distribution. Beneficiary’s inheritance may be made directly to the beneficiary or a court-appointed conservator if the beneficiary is a minor/incapacitated. Funds will be distributed directly to the beneficiary at the age of 18.

Mom and daughter hugging

The important takeaway from all of this is that a testamentary trust can be entirely personalized to fit your wishes. For example, most folks want the testamentary trust written in such a way that their beneficiaries may have access to funds to pay for higher education costs like tuition, room and board, books, and fees, on top of the necessary funds needed for an adequate standard of care, protection, support, and maintenance of the beneficiary.

Estate Plan Revisions & Updates

If you already have an estate plan review it. Estate plans never expire, but major life events or a change in estate planning goals can necessitate changes. For example, if your family welcomed a new baby or adopted a child then it’s definitely time to update your estate plan to include them! Maybe something changes in the future with one of your beneficiaries and you want to change distribution percentages or ages? Simply contact your estate planning attorney and let them know your wishes.

A Lasting Love

hearts on a string

The love for your children knows no bounds and without a doubt, you want to make certain you can still provide for them if something unexpected were to happen to you. There’s no day like today (or Valentine’s Day!) to get your ducks in a row just in case. The best place to begin is with my Estate Plan Questionnaire or by contacting me.

single pink carnation

Here on the GoFisch blog we’re covering how estate planning and love are two things that go together like hugs and kisses, red wine and chocolate covered strawberries, cute cards, and candles…just in time for Valentine’s Day!

If the sight of Valentine’s Day cards, heart-shaped candy, and overpriced stuffed animals give cause for an eye roll, you’re not alone. But, there’s no doubt that underneath all the conversation hearts that a holiday about love is worth celebrating…especially if it’s self-love. At the end of the day, there’s no greater love than the one you can cultivate for yourself.

Couples get a lot of attention on Valentine’s Day—from the overpriced card aisle to the heart-shaped chocolate boxes that are clearly the only way to tell someone “I love you.” But, the pink, red, and white modern iteration of the pagan fertility festival Lupercalia can take many forms including making it a day of “treat yo’self.” If you’re single, or simply are in need of a day to celebrate and connect with how awesome you are, Valentine’s Day need not be a day to exalt romance, but a holiday to celebrate love for yourself.

In terms of celebrating yourself, executing an estate plan is a natural fit. Why? Because estate planning allows you the chance to determine the direction of your legacy even after your physical life has passed. This principle can easily be remembered with one simple phrase: Give whatever I have to whomever I want, the way I want when I want.

That’s a celebration of your life if I’ve ever heard it—decisions that guide your hard-earned property and assets into the hands of beneficiaries whom you care for. Estate planning also saves your loved ones’ time, money, and the arduous intestate probate process. Don’t forget that estate planning can (and should) be personalized to entirely fit you! Have a best furry friend? You may want to consider an animal care trust. Have you invested in a fledgling art collection? You’ll want to review your three main options for art disposition. Own your own business? You’ll want to look into a trust and a business succession plan.

So, treat yourself to a nice bottle of wine, a delicious dinner, maybe even a day at the spa, but also download my Estate Plan Questionnaire. You deserve to celebrate yourself, your life, and your work. Questions? Want to talk about the individualized aspects of your estate plan? Don’t hesitate to contact me.

strand fo valentine

People can say “I love you” in many different words and through many different actions. This Valentine’s Day I want every Iowan to consider creating an out of the ordinary gift…an estate plan! An estate plan is not just an important legal document that saves your friends and family time, money, and potential heartbreak. A quality estate plan is also a way of expressing care, commitment, and, yes, even love…be it adoration for your significant other, for your family, or even just out of respect for your life and legacy.

I could go on and on about the importance of having health care and financial power of attorney documents in place well before you hopefully never need it. I would be happy to share more than you’d ever want to know about the nomination of a guardian for minor children. Don’t get me started on the importance of detailing your wishes in the disposition of final remains document. But, I thought we could have a little fun with these sharable valentines (use the tag #PlanningForLove!) to get you inspired to take that first estate planning step and fill out my free Estate Plan Questionnaire.

Love is When

Help your favorite people avoid any reason for in-fighting or litigation. Have a quality estate plan made by a professional and then discuss your decisions with those close to you.

Love is when quote

Great Love

For any great love, you’ll want to continue providing and supporting that individual even after your passing. Talk to your estate planner about what tools and strategies, like a living revocable trust, would be best for your situation.

Great Love Quote

Saved Up Wishes

There’s no better way or place to detail your wishes for what you want to be done with your hard-earned assets than in an estate plan. For instance, if you want to give a portion of your estate to the charities near and dear to your heart, you can do so in your will.

love letter illustration

Look in the Same Direction

If you’re married you and your spouse both need your own individual estate plan! Many married couples do have the same estate planning goals and opt to have the same estate planning attorney draft both of their plans. Other times couples opt for separate attorneys. (Give this piece a read for more information.)

Coral and Teal Heart Pattern Valentine's Day Card

Of course, I would love to receive a Valentine from you, but I would also like to talk with you about your estate planning needs and how, oddly enough, this legal document makes the perfect Valentine’s Day gift to yourself or someone you love. Contact me at any time via email or phone (515-371-6077).

wine and glasses

A fancy dinner out on the town is nice. Going to see a show is great. A trip to the spa for a couple’s massage is romantic. All are excellent date ideas and I fully recommend you pursue them! But, in addition, there’s one unconventional date idea you and your significant other should consider this Valentine’s Day: reviewing your estate plan.

forever scrabble tiles

Don’t worry, even though I’m an attorney I totally understand that reviewing multiple pages of a legal document isn’t outright romantic (much to the relief of my wife). However, because I am an estate planning attorney I know realistically how important it is to keep your estate plan updated and current. Taking time with your significant other to consider your current and future assets, as well as your estate planning goals is a practical “date” with major benefits for the future like saving time, money, and eliminating hardship on your family and friends.

Major life events like the birth of a child or grandchild, marriage or divorce, moving to a new state, a major change in financial situation, and/or the loss of a designated representative or beneficiary could necessitate changes to your estate plan to keep it valid.

An outdated estate plan could more easily be challenged in probate court or create unnecessary tensions between your loved ones. (This is yet another reason estate planning relates to the concept of love so well—the act of proper, quality estate planning can reduce the likelihood of future tensions and conflicts. Knowing that with a bit of planning and annual updates you can give your family and friends clear instructions that allow them to sidestep drama is certainly an act of love in its own right.)

Let’s use some hypothetical examples to explore why it’s necessary to update your will and the other important estate planning documents. If you have minor children you should have nominated a guardian in your will in case something was to happen to you. Let’s say the primary guardian you nominated has since moved far away—this may mean you need to consider nominating a new guardian.

In another example, it came to light since you made your estate plan that your financial power of attorney designated representative has fallen on hard times due to a gambling addiction…you’ll seriously need to consider amending the document and designating a different representative.

Speaking of change, remember too that state and federal laws are perpetually changing and when certain rules change, so too must your estate plan. Case in point? The “Tax Cuts and Jobs Act of 2017,” AKA the new GOP tax bill. For instance, the changes to the federal transfer tax exemptions could impact decisions as to if a certain type of trust is applicable. Again, this is where an experienced professional estate planner, whose job it is to stay up on these policy changes so you don’t have to, is beneficial.

two shells make a heart

A Legal & Loving Tradition

Again, it’s a good idea to review your estate plan at least once a year even though estate plans never expire. What better date reminder for a long-lasting document indicating a standing commitment to care and support than Valentine’s Day? Make it a tradition! (You can even drink wine and eat a box of chocolates while you review.) Along with reviewing the estate planning documents, it’s smart to check in with your professional advisors like your estate planner, financial advisor, insurance agent, and the like.

Of course, if you don’t have an estate plan yet that’s the first step. Even more “romantic” than reviewing your estate plan? Filling out my Estate Plan Questionnaire! Don’t hesitate to contact me with any questions and share the results of your estate plan review with me via the hashtag #PlanningForLove on Facebook, Twitter, and Instagram.

As Valentine’s Day approaches you’ll see all kinds of gift guides telling you if you get these gifts, your significant other will love you that much more. I’m here to present a different kind of gift guide: one with important gifts that you cannot buy from a store. These gifts are all a part of estate planning in one way or another. At this point, you’re thinking what does some legal/financial thing like estate planning have to do with a holiday that celebrates love? On the outset, not much. But, dive into the reasons behind proper estate planning and most often I find love is at the foundation for most folks.

man with bouquet of roses

Read on for a gift guide you definitely won’t find in a magazine!

For your Spouse: Review your Beneficiary Designations

Your estate plan is essential for the majority of your assets, but it doesn’t cover some important accounts that are passed along via beneficiary designations. Such accounts can include savings and checking accounts, life insurance, annuities, 401(k)s, pensions, and IRA accounts. Whoever is listed as the beneficiary on these accounts overrides what’s written in a will (if the two are different). That means keeping these beneficiary designations are super important. Let’s say you listed your first spouse as a beneficiary on your life insurance, ended up getting divorced, got remarried to a great person you have many happy years together and then you pass away. Unfortunately, you never changed the beneficiary designation and the ex-spouse inherits the money. More than likely you would have wanted the account assets to go to your current spouse. (More valuable than some heart-shaped Valentine’s jewelry, right?!)

It’s good practice to review all of your beneficiary designations if there have been any life events that would necessitate a change, addition, or update, such as a birth, death, or change of capacity in a beneficiary.

For the Entire Clan: Talk About your Estate Plan Decisions

It’s important to discuss your estate planning decisions with your family members both before and after the plan is executed. In drafting the estate plan you’ll need to indicate to your qualified estate planning attorney whom you’re entrusting the important roles of executor, attorney-in-fact, guardian, and other designated representatives to. Before naming someone in a legal document you should discuss the role with them first to be sure they are willing, able, and informed to the duties of the role.

strand of hearts

After the estate plan is executed you’ll want to discuss your estate planning decisions with loved ones, family members, and beneficiaries, especially when your choices may take them by surprise. How can a discussion be a gift, per se? Explaining your wishes is a way of expressing your love by heading off any confusion your family and friends may feel upon needing to execute your plan.

This is yet another reason to have an attorney draft your plan—your estate planner can help you communicate your wishes to your loved ones.

For your Kiddos: Nomination of Guardian

This is the kind of “gift” your child(ren) will hopefully never need to experience. One of the most critically important features of an estate plan is establishing guardianship for any minors (i.e., children under the age of 18) in your care. Why? In the tragic and terrible chance that something was to happen to you resulting in immense incapacitation or death, who do you want to care for your children? Nominating a guardian in your will allows you to select the people you know will love, care, and lookout for the best interests of your child.

Unless guardianship has been established, an Iowa Court must choose guardians. Unfortunately, with no clear choice as to what the former caregivers would have preferred, the Court must basically make its own and best determination as to who the parents would have preferred and what would be in the best interest of the children. The Court may or may not, choose who the former caregivers would have named.

For your Favorite Charity: Charitable Bequest

Valentine’s Day doesn’t just have to be mean about personal relationships! It can also be a day for sharing the “love” for charities you care deeply for. In making or updating your estate plan think about what charities are near and dear to your heart? Which organizations and how much would you want to leave for them? You can include your church, alma mater, local cause, or international organization in your estate plan as beneficiaries. It doesn’t cost anything extra, other than assets from your estate. Want a clearer picture of how a charitable bequest could help your favorite charity? Talk to the nonprofit’s leaders or fundraising staffers. I’ll bet they’ll tell you the result of your charitable bequest, no matter how big or small, can make an important impact.

Love can take on many forms and express itself through many different types of gifts and actions that show you care. Choose this Valentine’s Day to express your affection (be it for a significant other, your children, or a charity) with a “gift” that shows a clear investment in the relationship. And, speaking of amore, I would love to discuss any aspect of this gift guide with you! Contact me at any time.

football on field

For two formidable teams (Kansas City Chiefs vs. San Francisco 49ers), it’s the culmination of a season. (And for us, it’s a great excuse to indulge in all the best tailgating snacks.) It’s a grueling seven-month schedule with tons of variables from pre-season training camp to regular season kick-off to post-season playoffs.

Just like all the games leading up to the Super Bowl, a lot can happen throughout a lifetime. So many variables, so many strategies, upsets, and so many potential outcomes.

While it may be difficult to ponder the inevitably of your own timer running out, preparation for what happens after your season ends is indeed necessary.

football estate plan

The Main Players

Estate plan – An estate plan is the whole playbook, generally containing the following documents: your will; healthcare power of attorney; financial power of attorney; disposition of personal property; and final disposition of remains.

Will – A will is a superstar which can accomplish so much for your team. For example, who will quarterback the distribution of your property at the end of the game? You need to make certain the will is well crafted, solid, and can stand up in court. Keep in mind though, important assets such as retirement assets and investment accounts may well contain beneficiary designations that actually trump your will.

Health care power of attorney  & financial power of attorney – Don’t let a sudden disability completely take you out of the game. Have someone strong come off the bench to carry you to your personal goals.

Trust – You have lots of different options with this multi-tool MVP. A trust can help your team in so many different ways and provide you huge advantages in every facet of the game.

Get a Good Playbook!

Thorough planning is the best way to plan for the end of your season so that you and your family are never caught unprepared. When you are no longer around to coach and care for the rest of your “team,” make sure they are both provided for and are provided training on how to keep pushing forward by settling your affairs. A comprehensive estate plan, written by an experienced estate planner, is the best way to do this.

No ‘I’ in Team

Your loved ones and close friends are all a part of your team; part of being a strong team player is including them on the plays you’re making. Discuss important aspects of your estate plan with the people it involves to avoid any confusion or conflict when it comes times for them to carry out your wishes. For instance, if you have minor children (under age 18) you’re going to want to establish legal guardianship if the worst happens and you’re no longer around to care for them. You’ll want to discuss with your chosen guardians ahead of time to make sure they’re willing and available to carry out the responsibility.

Lineup Adjustments

Pro football coaches switch up who’s starting for the best winning strategy. Similarly, you may well need to make adjustments to your estate plan “lineup” as things inevitably change over the course of your life. Big events like marriage, the birth of a child/grandchild, moving to a different state, a large change in financial status, divorce, and other significant changes are a good reason to review your designated representatives, beneficiaries, and overall goals.

Charity Factor

Pro football players make bank, but many also make significant contributions to charities they care about. Some NFL players have founded their own charitable foundation, while others focus on a few nonprofits whose missions they care deeply about. For instance, Chris Long, the Eagles defensive end, announced last fall he will donate his entire salary ($1 million) from the season to educational charities. Most players also work together as a team to give back to their communities. The league as a whole also supports building awareness for nonprofits through initiatives like “My Cause, My Cleats.”

Given their high profile sports status, these players also help inspire folks across the country to do the same. (In one great example, these football fans donated to NFL players’ favorite nonprofits!) You too can be a fierce philanthropist, but without actually having to sprint, throw, or sweat! You can include your favorite charities in your estate plan as beneficiaries. Then there are the other charitable giving tools that can be included as a part of your “end game” like charitable gift annuities and the charitable remainder trust.

Winning Score

I cannot predict who will win the Super Bowl today, but I can say without a doubt that you never know when the game is going to change. You never know when you (and/or your team members) are going to need any one of the documents a part of your estate plan. So, you need to have your “playbook” written out ASAP…well, you can wait until after the big game!

The best place to start on your estate plan is with my free, no-obligation Estate Plan Questionnaire. You can also shoot me an email or give me a call at 515-371-6077 to discuss your situation (or football).

A will may provide for disposition of the testator’s assets at the time the will is executed, but of course it may be many years—many decades, even—between the will’s execution and the testator’s death. What if between the execution of the will and the testator’s death, there are changes in circumstances (such as the death of beneficiary) which make it impossible for the executor to follow the dispositive provisions of the will? That’s where estate planning gets complicated and can open the door to litigation.

Changed Circumstances = Default

Of course, we would first look to the language of the will. But, what if the will fails to address the changed circumstances? In such cases, Iowa law provides default rules. Obviously, it is much preferable for the estate planner to raise the possibility of changed circumstances with the testator during the drafting process, and address them accordingly with clear language in the will. (Yet, another reason to use a lawyer to draw up your estate plan.) And, yes, you should keep your will (and overall estate plan) updated.

Death of a Beneficiary

If Grace provides in her will, “I give Lawrence $10,000,” and Lawrence dies before Grace, the will can’t be followed exactly as written. Of course, this situation can and should be avoided by careful drafting – the estate planner asking what the testator wants if a beneficiary should predecease the testator. If, continuing this example, Grace wants the bequest to pass to Lawrence’s estate or Lawrence’s children if Lawrence predeceases her, Grace should so specify in her will. If instead Grace wants the bequest to go to other beneficiaries, the will should spell that out, too.

The Doctrine of Lapse

Let’s take our example and apply the doctrine of lapse. Under the common law, a bequest would fail, or lapse, if the beneficiary predeceased the testator. The bequest would simply fall back to the estate.

Iowa’s Anti-Lapse Statute   

Iowa is among the majority of states which have adopted anti-lapse statutes. Iowa Code Section 633.273 provides that if a beneficiary (actually, the statute uses the legal term devisee) dies before the testator, leaving children who survive the testator, the devisee’s children inherit the property devised, unless the terms of the decedent’s will is clear and explicit to the contrary.

Real Life Case

Clyde Guthrie executed a will in 2002 and died in 2006. His wife predeceased him, and so did two of his five children. Both of the predeceased children died before Guthrie executed his will. That turned out to be a key fact. Guthrie’s will left his entire estate equally to his five children except “in the event any of my children should predecease me leaving issue who survive me, then the share of such predeceased child shall go in equal shares to his or her issue who survive me . . .” His three surviving children claimed that the will language meant to include only them—the decedent’s children that survived him, and not the grandchildren of one of their deceased siblings. That predeceased sibling only had one child, and that child also predeceased the decedent, but left two surviving children–great-grandchildren of the decedent. (The other predeceased child died without having had children).

 

old hand and baby hand

Application of Facts to Iowa Code Section 633.273

On first glance Guthrie’s will appeared to be clear. Again, his will stated that if children predeceased him, “the share of such predeceased child shall go in equal shares to his or her issue who survive me.” However, the Iowa anti-lapse statute defines “devisee” as a person who dies after execution of the decedent’s will unless the will clearly specifies otherwise. Here the pre-deceased child that left surviving issue died long before the decedent executed his will. So, the anti-lapse statute didn’t apply, and the great-grandchildren were not beneficiaries of their great-grandfather’s estate.

Guthrie of course knew that two of his children had already died. The language of the Guthrie’s will, the Iowa Court of Appeals reasoned, could only possibly refer to the possibility of any or all of the three remaining children dying before he did – and the decedent’s will did not clearly state that issue of an already pre-deceased child should be included. (Review the case: Estate of Guthrie v. Busch, No. 8-093/07-1427 (Iowa Ct. App. May 14, 2008).

Back to the Basics: Let’s Review

With that example in mind, let’s review again the basics of the doctrine of lapse. Under the common law, if a beneficiary dies before the testator, the bequest lapses, i.e., goes back to the estate.

Iowa changed this rule by adopting an anti-lapse statute. Under current Iowa law, if the beneficiary dies before the testator, but leaves children who survive the testator, the beneficiary’s children inherit the property devised, unless the terms of the decedent’s will are clear and explicit to the contrary.

Of course, the problem of lapse/anti-lapse can be avoided through careful drafting by a trained professional, as well as annual reviews to see if your estate plan needs updating.


Have questions about your own estate plan that may be in need of revisions after learning about lapse? Contact me and we can talk about what changes would be wise for you to incorporate into your estate plan.

footballs on wall

Turn on ESPN, put on your jersey, and stock with fridge with a cold beverage…the College Football Playoff National Championship is this Monday, January 13, 2020. (The game kicks off at 8 p.m.) While reading up on the stats and predictions for a tiger showdown between the LSU Tigers and Clemson Tigers in New Orleans’ Mercedes-Benz Superdome, I couldn’t help but make a connection with estate planning. Goalposts to estate planning goals may seem like a stretch, but hear me out.

 

Football is a complex game—the field is full of moving parts and competing strategies; it’s a game of inches where just a few missteps or right moves can make a huge difference. Estate planning works the same way. Here are just five of the surprising similarities between estate planning and the game of football:

1. Your Clock Will Indeed Run Out

Just like every football season eventually comes to an end, your (hopefully long and healthy) season will also come to a close. When it does, you need a special kind of playbook for the rest of your team…AKA an estate plan. In this analogy, an experienced lawyer is a great coach who is going to help you put plans in place for when the game changes unexpectedly or the stadium lights turn off for the last time. And, just like so much can change over the course of a season, a lot will happen over the course of your lifetime. That’s where annual reviews and revisions after significant events fit in.

While it is often difficult for people to ponder their unavoidable exit off their own fictitious field, preparation for what happens after your season is over can be one of the most comforting aspects of financial and legal planning.

2. The Main Players

Let’s take this analogy a bit further and put some estate planning terms into football speak.

Estate – An estate is a whole playbook, containing the following documents: your will; health care power of attorney; financial power of attorney; disposition of personal property; and final disposition of remains. (Click on the link preview below to delve deeper.)

Will – A will deals primarily with the distribution of assets and care for minor children. You need to make certain the will is well-drafted, solid, and can stand up in court. Keep in mind though, important assets such as life insurance policy payouts, retirement assets, and investment accounts may well contain beneficiary designations that trump your will.

Trust – You have lots of different options with this player. A trust can dictate how your assets will be dispersed, the timeline and manner in which they are dispersed, and who’s overseeing the process.

3. You Must Make Mid-Season Starting Lineup Adjustments

Just as a coach may switch up who’s starting partway through the season, you may need to make adjustments to your estate plan as things inevitably change over the course of your life. Big events like marriage, birth of a child/grandchild, moving to a different state, a large change in financial status, divorce, and other significant changes are a good reason to review your “playbook.”

4. No ‘I’ in Team

Your loved ones and close friends are all a part of your team; part of being a strong team player is including them on the plays you’re making. Discuss important aspects of your estate plan with the people it involves to avoid any confusion or conflict when it comes times for them to carry out your wishes. For instance, if you have minor children (under age 18) you’re going to want to establish legal guardianship if the worst happens and you’re no longer around to care for them. You’ll want to discuss with your chosen guardians ahead of time to make sure they’re willing and available to carry out the responsibility.

5. Final Score

football on field

 

There are probably at least a few more good football analogies I could tie into the conversation of why you need an estate plan, but the most important takeaway is that you never know when the game is going to change. So, you need to have your “playbook” written out ASAP. The best place to start is with my free, no-obligation Estate Plan Questionnaire. You can also shoot me an email or give me a call at 515-371-6077 to discuss your situation (or football).

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The great thing about your estate plan is that once you have one, it never expires. However, it does need to be kept current with your life as well as applicable laws. Why? Keeping your estate plan updated and current is simply a smart part of planning. An outdated estate plan could more easily be challenged in probate court or create unnecessary tensions between your loved ones.

Because of this, I advise Iowans to review estate plans on an annual basis. Simply check in with your lawyer, and other professional advisors, every year or so. Some clients like to do this around the first of the year, others choose to do so on an easily remembered date like a  birthday or anniversary. Others pick a random date. Any date will work, just stick with it every year.

Seek the help of a professional advisors to update your estate plan, most especially when you undergo a major life change. A few of the most prominent examples:

  • You get married or divorced.
  • A birth or death occurs among your family  or other beneficiaries of your estate.
  • A person you chose to be a guardian, trustee, or executor dies or becomes critically disabled and unable to fulfill their responsibilities.
  • There is a change in the value and/or kind of property you own. Examples of this could be receiving an inheritance of some kind or right-sizing as retirement age approaches).
  • You move to another state or country, or you acquire significant property in another state or country. (A common example of this is buying a second home, like a condo in Mexico or lake house in Minnesota).

Any of these changes require careful (re)analysis of your estate plan.

If you have experienced any major life changes (including one not listed here), don’t hesitate to reach out to me at any time. If you’re not quite at this stage yet and first need the important key documents that comprise an estate plan, get started with my free, no-obligation Estate Plan Questionnaire.