What Happens if You Die Without a Will?

What do you want to have happen when you pass away? Who do you want to pass your grandfathers' watch or mothers' wedding ring on to? You do want to make that decision, don't you?

Something I see in my day-to-day meetings with my clients that's all too common is not having a valid will (or having a will that's not up to date). Of course I understand that it's easy to put off with life's demands and due to the fact that making a plan for when you die isn't exactly something people enjoy talking about. Nobody likes to do it.

"What Happens if You Don't Have a Will?"

The short and simple answer is your loved ones have to go through the court-mandated probate process (depending on the value of your estate, which varies depending on your state), which is a very time consuming and expensive way to settle an estate. The main purposes of the probate process is to do a couple of things:

- To settle the decedent's debt's.

- Protect the decedent's estate from being taken advantage of by following rules on how the real property will be divided.

I know from personal experience that going through probate for a loved one's estate is a difficult, emotionally straining, stressful, and expensive thing to live through. Generally speaking, the process can last 9 months or longer and will eat away around 5% of everything you've worked so hard for in the form of attorney's fees and settlement costs. That's a lot stress and money lost for the family due to not having a reasonably simple document in place, wouldn't you say?

Tips:

- If don't have one, get one executed immediately! They're relatively inexpensive (I provide a simple will kit to my new clients)depending on your situation and you may not even need an attorney to put one in place. Of course, it's always a good idea to use professional help as your situation warrants.

- Review your will after major life events (marriage, divorce, child birth, death in the family, etc.) or every 2 years. You want to make sure everything is still set up the way you intended and that your Corvette isn't going to go to your ex-spouse.

- Whether or not it's legally required, have your will notarized. This is an additional layer of protection which will help if your will is contested.

- Make arrangements in advance for whom will be the executor of your estate. This will take away some uncertainty and stress for the family, plus it's just good practice.

- Consult with a qualified attorney if your situation is complex. I know with the economy people are trying to save money, but this is one thing where you're better off not automatically trying to save a few bucks. If in doubt, call your attorney!

Intestacy Calculator

Click here to see how your estate would be divided if you passed away in Texas without a valid will in place (you can also choose other states as needed). Keep in mind that this doesn't take into account settlement costs and attorney's fees or the time and emotional strain on the family.

New Office in Austin, Texas!

Acacia Financial Partners is pleased to announce it was recently opened a new office in the Austin, TX area! Austin is great community, and we look forward to serving its residents for all of their insurance and investment needs.

Go Longhorns!

Who Will Rescue the Rescuer?

Today, all you have to do is turn on the TV or open a newspaper in order to hear another depressing story about the state of the U.S. economy and a magnitude of pending corporate failures. Many are watching eagerly to see if the government is going to bailout the likes of the automakers and some of the largest financial institutions in the world, and to what extent this is ultimately going to cost the American taxpayers. But the real question should be, “Who’s going to bail out the government when it can’t make good on its promises?”.

What do I mean?

Without major intervention, the government is going broke, and it's due to the generational tsunami that is the baby boomers! The problem is America has approximately 80 million people born between 1946 and 1964 that were essentially promised the world in the form of Social Security, Medicare, and pension benefits that are woefully underfunded to make good on these promises. Unfortunately, it’s very likely that promises will be broken since the monetary value of these future payments from programs like Social Security and Medicare are approaching $53 trillion dollars. That equals a bill of almost $174,000 for every man, woman, and child in the U.S.! Looks like I'm going to have to skip the cheese on my Whopper....

According to David Walker, former comptroller general and head of the Government Accounting Office,

“By the time today’s college graduates are ready to retire 40 years from now,the only things our government will be able to pay for are interest on the federal debt and some of the Social Security, Medicare and Medicaid benefits. All other parts of the federal government will be closed and out of business.”

Do I have your attention now? Walker also stated,

“The facts aren’t Democrat or Republican, the facts aren’t liberal or conservative; the facts are the facts. Our financial condition is worse than advertised. We need to act soon because time is working against us.”

Here’s some of the more startling statistics according to a study conducted by the National Center for Policy Analysis which state without a meaningful reform to entitlement programs like Social Security and Medicare and a major increase in the government’s revenue:

• By 2010, the federal government will have to stop providing for 10% of the programs it is currently funding.



• By 2020, the government will have to stop funding 25% of the services it currently provides.



• By 2030, it will only be able to provide 50% of the services it provides.



• By 2050, Social Security, Medicaid, and Medicare will consume nearly the entire federal budget.



• By 2082, the entire federal budget of the U.S. government will be consumed by Medicare alone.

I don’t know about you but I’ve grown accustomed to things like roads and schools being provided for me in exchange for my hard-earned tax dollars, but how are they going to be funded if we stay on the fiscal path we’re on? Anybody?

Raising Taxes or Cutting Benefits

One potential solution is to raise taxes, but that’s putting a Band-Aid on a gunshot wound considering the tax hike would have to be about 2.5 times today’s rates across the board to make a meaningful difference. I don’t know of anyone that wants to work 6+ months out of the year to pay their tax bill.

Another major hole in the tax argument is we have to consider that America is aging as a society due mainly to the baby boomer population and advances in medical technology. It’s projected that by 2030 approximately 1 in 5 people in the U.S. will be over 65 years old, and there will be something like 2 retirees for every American worker. It’s going to be impossible for so few workers to financially support the programs providing benefits that were promised to the baby boomers.

Promises will be broken.

My personal opinion is it will be a mix of reduced benefits in the future with higher taxes for all classes. There’s no more of the “rich” or whatever you call the top income earners footing the bill for everyone else. The math is impossible.

So What Should I Do?

According to Paul Volcker, former chairman of the Federal Reserve, in the book I.O.U.S.A.: One Nation. Under Stress. In Debt.

“Generally, people don’t change their behavior until they’re forced to. With
respect to the fiscal crisis looming out there in the future, we'll see whether a
democracy can deal with an obvious problem that’s going to be present in not too
many years. The earlier we take action to deal with it the better.”

The truth is Americans are going to have to re-evaluate what they expect from the government and are going to have to learn how to pay for what they’ve counted on Uncle Sam to provide in the past. The best advice I can give anyone is to stop counting on the government, or your company, or home-run appreciation on your home to provide for your retirement. You, along with the help of your financial professional, are going to have to take steps to make sure your financial future is secure with or without the government’s help.

Acacia Financial Partners & MassMutual to Provide Free Life Insurance to Families in Fargo, ND.

On December 16th, 2008 from 4pm-6pm we will be offering a $50,000 life insurance policy to working class families in the Fargo, ND area, at no cost. The program, called LifeBridgeSM, is provided through MassMutual Life Insurance Company who currently expects to issue a total of one billion dollars in free term life insurance coverage through its national philanthropic program. The policy proceeds help to pay for the education of eligible children if their insured parent or legal guardian dies during the ten year policy term.

How Does The Program Work?

If an insured parent or guardian dies during the policy’s term, MassMutual will deposit the $50,000 face amount into a trust administered by The MassMutual Trust Co., FSB, a wholly owned subsidiary of MassMutual, on behalf of the children. The trust will pay the educational expenses of the children directly to the educational institution they attend.

Qualifications

Parents and legal guardians between the ages of 19 and 42 may apply for this insurance coverage. They must have one or more dependent children under the age of 18, be working full or part time with a total family income of between $10,000 and $40,000, and be permanent, legal residents of the U.S. They must also be in good health, as determined by MassMutual’s underwriting guidelines.

How Can I Participate In This Program?

Parents and legal guardians may apply for this coverage during a special event on Tuesday, December 16, 2008 from 4:00 p.m. – 6:00 p.m. at Acacia Financial Partners, 23 Broadway N, Suite 305, Fargo, ND; reservations are necessary. For more information or to apply for insurance coverage through MassMutual’s LifeBridge program, contact us at 701-364-0371 or via e-mail at brakowski@finsvcs.com.

http://www.free-press-release.com/news/200812/1228338484.html

Finding Joy

Today I received a link to a great, albeit short, video that's filled with some truly inspiring quotes. Many of them are by great people like Norman Vincent Peale and Ralph Waldo Emerson, with my favorite quote being, "Sometimes in the winds of change you find your true path."

It added some joy to my day, so I wanted to pass it on!

Finding Joy Movie

When A Loved One Needs Care: My Family's Story

As many of you are aware, one of the main reasons that brought me to Fargo, ND is my Mom. Ever since I can remember my Mom has been living with Multiple Sclerosis, a debilitating disease of the nervous system, but it hasn't been until the past 5 years or so that the disease has progressed to the point that she couldn't do everyday activities like cooking, bathing, or going to the bathroom without assistance. What brought me to the area was the fact that she was getting worse and worse and would likely need some sort of professional care in the foreseeable future, so we wanted to make sure that her financial matters were taken care of ahead of time. But instead of helping with things like her will, I ended up becoming my mother's caregiver for about 3 months.

It was easily one of the most stressful times of my life.

"Don't Worry, We'll Take Care Of You!"

My little sister and I would always say that since she took care of us when we were younger, we'd do the same thing for her when she needed it. It's only fair, right? Something I hear all the time when talking to clients about long-term care insurance is, "I don't need it. My kids will take care of me.", and while I can certainly relate to the feeling of wanting to help a loved one, it's so much more than just getting the mail and picking up groceries once a week as I soon found out.

According to a USA Today/ABC News/Gallop poll of baby boomers:

• 41% have a living parent they are providing care for (financial help, personal care or both).


• 8% of boomers say their parents have moved in with them.

Of those who are not caring for an aging parent:

• 37% say they expect to do so in the future.


• About half say they're concerned about being able to provide such care.

An Average Night


"Brian!"

My eyes slowly open, and as I lay there trying to figure out if my Mom actually called my name or if it was just another nightmare, I look at my alarm clock: It's about 3:30am. I pause for a few seconds before trying to go back to sleep.

"Brian!" she yells again even louder. "Not again..." I think to myself as I try to clear the cobwebs out of my mind. "I just got up 2 hours ago to help her out of bed. What's wrong now?" Even though I'm a little cranky from being woken up for the second time of the night, I try not to show it. As I turn the corner into the living room, I see my Mom lying on her stomach next to her electric scooter.

"I fell again...." She says, almost on the verge of crying.

My heart sinks as I see her lying face down on the carpet, unable to get up by herself, and I immediately feel guilty that just moments before I was upset about being roused out of bed in the middle of the night. After picking her up and setting her onto the seat of her candy apple red scooter, I start slowly heading back down the hallway, finally able to go back to bed. Or so I thought.

"Brian? Will you help me go to the bathroom?", she quietly asks. "I'm afraid I'm going to fall again."

Another fifteen minutes pass as I place her onto the toilet, waiting for her to finish before helping her pull up her pants and lifting her back onto her scooter. "Thank you, honey.", she says as she slowly drives her scooter into the kitchen where she'll spend the rest of the night watching Andy Griffith re-runs on TV Land.


"That's alright, Mom. I love you. Do you need anything else before I go back to bed?", I ask as I try to hide the growing depression and frustration I feel about the entire situation.

She softly replies, "No honey. You go back to bed. I'll be alright."

I hope so.

The Financial Impact of Being a Caregiver

According to the AARP, the "typical" unpaid caregiver:

• is a 46-year-old woman who works outside the home while taking care of a relative.

• is forced to cut the hours she works at her regular job by about 41%, causing her salary and benefits to fall sharply.

• loses an estimated $659,000 in lost in pensions, Social Security benefits and wages as she takes time off from work to care for her aging parents.

• reports having one or more chronic conditions, such as high blood pressure, at nearly twice the rate of all Americans. Of those who say their health has worsened because of caregiving, 91% report depression.

A Potential Solution

When it comes to the unfortunate time where a loved one is simply unable to fully take care of themselves anymore, there are a few potential solutions. In my opinion, the best option is to look at purchasing a long-term care policy for your loved ones. I'll be writing a more in-depth article about some other available options in the near future, but I'll end this post with a saying that an associate of mine told me about why he's so passionate about helping people with their long-term care needs.

"Long-term care insurance allows families to care about each other, instead of having to take care of each other."

I like that.

USA Today: Becoming "Parent of Your Parent" an Emotionally Wrenching Process

Retiring in a Bear Market: Is Now a Good Time?

The Golden Years?

Retirement is often called the "Golden Years" since it's supposed to be the time when you are rewarded for a lifetime of hard word. But is it still considered "golden" when all you can afford to do is sit on your porch due to a falling stock market in the crucial years right before retirement? This couple didn't think so.

Here's a video that I found on foxbusiness.com that outlines a few options that allowed a couple to be able to securely retire during turbulent economic times.

Fox Business: Bear Market Retirement

Give us a call to discuss some different options that will allow you to have that secure retirement you've been working for and for a FREE retirement plan analysis. If your current strategy isn't going to work, when would you like to know?