PERSONAL PLANNER
Chronic Illness - Care of Your Property
 f you have a chronic illness, you will need to care both for your person and for your property. This article will explain some of the specific preparations that are important to care for your property. With a chronic illness, you may have a higher probability that you will not be able to manage your property and will need assistance during your lifetime. In addition, there will be a need to make sure that your testamentary transfers are upheld if a relative questions your ability or your capacity to make those decisions.
Power of Attorney
There are several types of powers of attorney for managing your property. With a chronic illness, you may not have the physical or mental capability to manage your property. A designated person can be of great assistance to you in making sure that your property is managed and used for your best care.
A general power of attorney will permit your selected representatives to have complete control over all of your financial affairs. It is quite powerful, but must also be granted carefully so that the person uses that broad power appropriately. You must have a high level of trust in the person to give him or her general power of attorney.
A special power of attorney is a grant of limited rights. For example, a person may have the right to lease or sell your principal residence. If you are transferred to a care facility and will no longer be able to return home, it may be good to give a person the legal right to sell your residence.
A "springing" power of attorney can be particularly useful if you have a chronic illness. In the event that you are incapacitated or unable to function effectively, then your selected agent may assume the rights under your power of attorney. With a springing power, there can be difficulty in determining whether the lower level of incapacity is sufficient to trigger the power. For this reason, some states have specific requirements and restrictions on springing powers.
If your designated agent for the power of attorney has fairly broad power, you may wish to include the ability for that person to make gifts to family or gifts to charity. Typically, the right to make gifts enables your agent to continue your current pattern of gifts to family or to charity. Your agent will decide if the resources in your estate allow both the making of gifts and providing for your care.
Capacity to Make a Will
With a chronic illness, your basic estate planning document is still a will. While you may also have a revocable living trust, a will is needed to distribute any property not owned by the trust when you pass away.
Many of your assets will pass to beneficiaries outside the probate process and will not be owned inside your trust. These include your qualified IRA and other retirement plans, life insurance policies that are transferred by beneficiary designation and any real property owned as joint tenants with right of survivorship. That real property will be transferred under property law to the surviving person.
However, if your designated beneficiary under a qualified retirement plan or a life insurance policy passes away before you, or the other joint tenant with a real property asset passes away prior to your demise, the assets could be distributed to your estate and be subject to your will. Therefore, it is essential to have a proper will.
With some types of chronic illness, you may have a loss of either physical or mental abilities. In this case, an heir could claim that you did not have proper capacity to sign the will and could contest it. Therefore, it may be helpful to emphasize to your witnesses that you clearly understand the process and have a good understanding both of your property and of the general provisions of the will. In addition, some individuals obtain records from their physicians that explain the various types of treatment. Your doctor may also discuss your ability to have control of your mental facilities during the estate planning process.
Revocable Living Trust
A revocable living trust is strongly recommended if you have a chronic illness. It is much more flexible than a durable power of attorney.
If you suffer from a disability or become incapacitated, upon the recommendation of one or two physicians your successor trustee will be empowered to manage your assets.
With no revocable living trust, a family member may instead be required to obtain permission from the probate court to create a conservatorship. This will require expensive and repeated visits to the court for approval of expenditures, sale of most real property and other actions. It will greatly increase the expense and the difficulties for the person who is acting as your conservator.
A successor trustee under a revocable living trust is far more flexible and less expensive. Compared with a conservatorship, the cost of creating the revocable living trust may be recovered in the first few months of the time when you need someone else to manage your property.
Revocable living trusts are a legal agreement. You specify the management powers of the trustee, the general provisions for distribution of income and principal and select your successor trustee. Ordinarily, you will serve as the initial trustee. If you are incapacitated, the successor trustee will take over and manage the property. Your property will be legally transferred with a deed for real property and by creating trust accounts for mutual funds, securities and cash. It is essential to make sure that title to the selected property is properly transferred under state law rules to you as trustee of the living trust.
Assemble Your Records
Even if you have a power of attorney to help manage your property, have signed a valid will and have created a revocable living trust, it will help your advisors if you have an organized system for your records.
The first set of records should include all of the above planning documents. In addition, the documents for the care of your person, such as a durable power of attorney for healthcare, a HIPAA release, a living will or an advance directive should be included.
The second set of documents will be all of your financial records. Many people with a chronic disease have placed their records on computer. Through a combination of online banking and records from your brokerage and securities accounts, all of your financial data can be accessible in one location.
The third category of record is your family information and personal history. This could include marriage certificates, insurance records and other various types of medical reports.
|
 FINANCES
Stocks - Williams-Sonoma’s Forecast Disappoints | Williams-Sonoma, Inc. (WSM), a specialty retailer of cookware and home furnishings, announced its second quarter results on Thursday, August 28. The company provided a disappointing forecast for the rest of the year, which drove the stock price down. |
| Williams-Sonoma reported revenue of $1.039 billion during the quarter. This amounted to a 5.8% increase over the $982 million reported during the same period last year. |
| “We enter the second half of 2014 well-positioned across our brands from a marketing, merchandise offering, store and online experience standpoint,” said Laura Alber, Williams-Sonoma President and CEO. “We remain focused on disciplined execution against our growth initiatives and a balanced approach to capital allocation to continue to drive shareholder value.” |
| The company reported that earnings per share grew 8.2% to $0.53. Earnings per share was $0.49 during the same period last year. |
| Williams-Sonoma has been on a tremendous run this year as its share price has gained nearly 29% so far. However, the company’s share price fell 12% following the earnings announcement on the company’s reduced forecast for the rest of the year. Williams-Sonoma now projects earnings to be between $0.58 and $0.63 for the third quarter, below the pre-release estimate of $0.66. In addition, same-store sales growth of 5.7% during the quarter missed estimates of 6.2%. |
| Williams-Sonoma, Inc. (WSM) shares ended the week at $65.77. |
| Tiffany’s Earnings Sparkle |
| Tiffany & Co. (TIF) announced its second quarter earnings on Wednesday, August 27. Both net sales and earnings per share surpassed pre-release estimates. |
| Tiffany reported an increase in net sales of 7% to $993 million during the quarter, better than pre-release estimates calling for $988 million. Net sales were driven by same-store sales growth in the America and Asia-Pacific regions of 8% and 7%, respectively. |
| Michael J. Kowalski, Tiffany’s Chairman and CEO, had this to say about the quarter: “These healthy second quarter results reflected solid sales growth in our stores, particularly in the Americas and Asia-Pacific regions. In addition, an improved gross margin was an important contributor to the earnings growth.” |
| Net earnings during the quarter increased 16% to $124 million or $0.96 per share. This beat pre-release estimates calling for $0.85 per share. |
| Tiffany & Co.’s quarter was a pleasant surprise for investors and the luxury jeweler was able to post impressive results amidst a weak economic climate around the world. Sales were especially strong in the Asia-Pacific region despite a significant decline in Japan. The company even raised their annual earnings guidance by one penny. Following the results, Tiffany’s share price briefly rose to a record $105.67 per share. |
| Tiffany & Co. (TIF) shares ended the week at $100.94. |
| Bob Evans Reports Results |
| Bob Evans Farms, Inc. (BOBE) announced its first quarter 2015 results on Tuesday, August 26. The company’s results indicated it still faces significant challenges going forward. |
| Bob Evans reported sales during the quarter of $326.3 million, a 1% decline from the $329.5 million reported in the year-ago quarter. Analysts expected sales of $328.6 million. |
| Bob Evans has recently been trying to transform its business to meet changing circumstances. To this end, the company has invested $800 million in the process and believes it is beginning to see good results. “We are seeing early positive results as we begin leveraging our strategic investments,” said Steve Davis, Chairman and CEO. |
| The company reported a net loss during the quarter of $1 million or $0.04 per share. This is a significant decline from the income of $8.4 million or $0.30 per share during the comparable period last year. |
| Bob Evans has faced significant difficulties the past few years as the economic climate continues to remain muted. It is making a huge bet that its $800 million investment can help the company get back on track. Along with these challenges, the company has also faced criticism from activist shareholder Sandell Asset Management, which has advocated Bob Evans sell its packaged food business. During the earnings announcement, Bob Evans revealed that Sandell had successfully elected four directors to the company’s board. |
| Bob Evans Farms, Inc. (BOBE) shares ended the week at $43.42. |
| The Dow started the week of 8/25 at 17,012 and closed at 17,099 on 8/29. The S&P 500 started the week at 1,992 and closed at 2,003. The NASDAQ started the week at 4,564 and closed at 4,580. | Treasury prices rose on Friday, August 29 as NATO reported Russian forces finally invaded neighboring Ukraine this week. In addition, mixed economic data continues to paint a less-than-rosy picture of the U.S. economy. |
| Treasury yields remained relatively steady this week as uncertainty around the world continued. U.S. Treasuries continue to attract buyers seeking the security they offer as bond yields in Europe continue to fall. |
| “The geopolitical issues and Europe helped the market out,” said Justin Lederer, Interest-Rate Strategist at Cantor Fitzgerald LP in New York. “It’s worth buying the long end. I’m hesitant of shorter maturities as we progress toward the Fed rate hike and expectations for rates to go higher.” |
| The Federal Reserve has reduced its monthly bond purchases to $25 billion, down from $85 billion a year ago. The Fed continues to pare down monthly purchases by $10 billion on its way to ending the bond-buying program later this year. In addition, traders believe there is a 70% chance the Fed will raise the interest-rate target to at least 0.5% by September, 2015. The target rate has been between 0 and 0.25% since 2008 in an effort to prop up the U.S. economy. |
| Economic data this week also revealed the U.S. economy still has work to do. Household purchases decreased 0.1% in July while consumer sentiment rose to 82.5. These figures disappointed and exceeded expectations, respectively. |
| The 10-year Treasury note yield finished the week of 8/25 at 2.34% while the 30-year Treasury note yield finished the week at 3.08%. | Freddie Mac released the results of its latest Primary Mortgage Market Survey (PMMS) on Thursday, August 28. The results show mortgage rates remain relatively unchanged from the prior week on new housing data. |
| The 30-year fixed rate mortgage averaged 4.10% this week. This was unchanged from last week. |
| This week, the 15-year fixed rate mortgage averaged 3.25%. This was up from last week when the 15-year fixed rate mortgage averaged 3.23%. |
| Frank Nothaft, Vice President and Chief Economist at Freddie Mac, had this to say about this week’s rates: “Mortgage rates were little changed following mixed housing news. Existing home sales rose for the fourth consecutive month to an annualized pace of 5.15 million, the highest of the year. On the other hand, new home sales fell for the third consecutive month to an annualized rate of 412,000 units. Also, the S&P/Case-Shiller national home price index confirmed the slowing in national house-price appreciation that has occurred in other metrics, with the seasonally-adjusted national index down 0.1% in June but on a year-over-year basis up a solid 6.2%.” |
| The money market fund finished the week of 8/25 at 0.4%. The 1-year CD finished at 0.7%. |
Lenexa, Kansas, United States - Leaving a Lasting Legacy Through Planned Giving from the Global Church of the Nazarene Foundation for Saturday, 30 August 2014
But you shall open your hand wide to him and willingly lend him sufficient for his need. . . . You shall surely give to him, and your heart should not be grieved when you give to him, because for this thing the LORD your God will bless you in all your works and in all to which you put your hand.”((Deuteronomy 15:8 and 15:10, NKJV))
No comments:
Post a Comment