The In-Service Alternative Rollover: Protecting The Value Of Your 401(k)

Remember your parents and grandparents’ pensions?  What if you could have some of the same benefits that they enjoyed from with their pension, with your 401(k) dollars?

Pensions gave an identifiable, calculable benefit.  Typically, pensions were based on age and years of service, multiplied by an average salary.  Unlike today’s retirement plans, the benefits of pensions were not directly dependent on the stock market.  Retirement today is vastly different.

About 30 years ago, employers began shifting from traditional pensions to 401(k) plans.  The main reason: cost.  You see, the employer was responsible for guaranteeing pension benefits to employees. Your father and grandfather (or grandmother) contributed nothing.  If the stock market crashed, then the employee did not care, at least not as far as his or her retirement was concerned.  The reason: pension plans were not tied to the markets.

With a 401(k) plan, employers require employees to provide the contributions.  In some cases, employers will match a certain amount of what you contribute.  But that is the catch – the employee has to pay for it.  And that’s not all!  With a 401(k) plan, who bears the risk of a market decline: the employee.  A falling market could at best delay your planned retirement.  And a market decline after you retire could severely impact your standard of living.

At Zwick Law, in coordination with proper financial planning, we may have the answer.  We may be able to restore some of the traditional pension-like benefits that your parents and grandparents enjoyed.  Benefits such as guaranteed, knowable monthly income, regardless of market performance.  That means, with our assistance and the proper financial planning, you can:

  • know for certain what you can depend on in retirement;
  • take comfort in guaranteed, continued payments to a spouse, if elected;
  • eliminate (or at least reduce) market worries – while a rising market may benefit you, a falling market does not impact the guarantees; and
  • obtain peace of mind before and during your retirement.

The In-Service Alternative Rollover (ISAR) is a legal process that, with proper financial planning, may protect your 401(k) benefits. To learn more about the ISAR process and whether it may be right for you, contact Attorney C.J. Zwick for more details.

Zwick Law is a full-service law firm with offices in DuBois and Brookville, Pennsylvania.  The attorneys at Zwick Law routinely represent corporations, associations, municipalities and individuals across Pennsylvania and West Virginia.  Find out more about Zwick Law by visiting https://zwick-law.com.

Common Complaints Made Against the Executor of an Estate

The role of the executor of an estate is one of complete trust and supreme responsibility.  Whomever you choose to serve in this capacity will oversee your final wishes to ensure that the terms outlined in your estate plan are followed. In theory, the person who is the executor of your estate will have few problems with your beneficiaries. In reality, however, it is not unusual for your executor to be at odd with your heirs for a variety of reasons. Being aware of common complaints made against an executor will help you when the time comes to choose someone for that role and help that person prepare to manage your estate.

Conflict of Interest

A person with a small estate and limited beneficiaries will often name a person to execute his or her will, and that person also is commonly named as a beneficiary.  Typically, that is not an issue and the other heirs will understand that being named in a will does not automatically mean that you will not be a fair executor. There are times when an executor has abused that position of trust and your other heirs may grow concerned, if they believe that your executor is focusing on his or her own best interest at the expense of their interests and those of the estate.  Lack of trust may lead to claims of a conflict of interest, in an effort to disqualify your executor from continuing to operate in that capacity.

Mismanaging Funds of Estate

The assets of an estate must be managed properly during the probate process.  Securing all assets is one of the most important roles of the position and is vital if the estate has many assets or outstanding debts.  Transactions must be recorded throughout the process of paying debts, filing tax returns, and distributing bequests using the funds or property available.  Sometimes, heirs will believe that the executor is not properly managing the assets of the estate and may file a complaint out of concern for the security of what they expect to inherit.  While an executor is compensated for his or her time, the amount of compensation may seem nominal in comparison to the value of the estate, leading to unease from heirs who believe the executor will find other ways to be compensated.

Lack of Communication

One of the most time-consuming aspects of serving as an executor is communicating with everyone associated with the estate.  Contacting creditors, keeping the courts informed, and talking to the beneficiaries is not always easy.  Unfortunately, some beneficiaries may not be satisfied with the level of communication they are receiving from an executor.  If they believe that they have not been contacted on a regular basis regarding the status of the estate, then they may initiate a complaint or attempt to get your executor removed.

Talk to an Experienced Attorney a Zwick Law

Choosing an executor is just one of the many things that you must do in order to secure your legacy for your loved ones.  A qualified estate attorney at Zwick Law can guide you through the entire process, and help you decide who is best suited to manage your estate while seeing to your final wishes.  The attorneys at Zwick Law are here to provide you with the legal advice and peace of mind that you need and deserve.  Contact us today at 814-371-6400 to schedule an initial consultation at our DuBois or Brookville offices.[1]


[1] Disclaimer: The use of the Internet, Facebook and/or any other form of social media communication with the firm or any individual member of the firm does not establish an attorney-client relationship.  Time-sensitive information should be directed immediately to the office of Zwick Law at (814) 371-6400.

 

 

Common Estate Planning Mistakes & How To Avoid The Pitfalls

Creating an estate plan is the best way to pass property and other assets to your loved ones in a manner that you believe is best suited for you and your family.  Unfortunately, the majority of adults in the United States do not have a will, and those who do often make serious mistakes that render the will invalid or impractical.  If you want to be sure that your final wishes are executed properly, you must spend time creating and updating an estate plan with an experienced attorney who can provide accurate and reliable legal advice.  If you attempt to create and implement such an important legal document, without the proper assistance, you increase your chances of making one of these four common estate planning mistakes.

Review Your Estate Plan to Ensure That it is Up to Date

The majority of people who invest time and money to create a last will and testament and other estate planning instruments do not properly review their estate plan to ensure that it is up to date and applicable to changed situations and circumstances.  It is possible that your last will and testament may not require changes over the years; however, it is very likely that major life events and changes in circumstances may be overlooked, which likely will create problems for your loved ones after you are gone. Those who neglect to update their estate plans throughout their lifetimes, often times accidentally omit after-born children and/or grandchildren; name people who predecease them; and/or choose a personal representative who they no longer trust.  The mere passage of time is reason enough to review your estate planning documents to ensure that these important documents remain applicable and coincide with your current intentions.

 Your Will Does Not Impact Non-Probate Assets, such as Life Insurance Policies

An asset that several folks maintain is a life insurance policy.  Life insurance policies ordinarily designate a primary beneficiary or beneficiaries – the person or persons who will receive all or some of a specified sum of money after the policyholder passes away – and a secondary beneficiary – in the event that the primary designee(s) predeceases the policyholder.  Typically, beneficiaries to these policies are spouses, children, siblings, and/or parents.  A person who has recently gotten divorced or who is estranged from a relative may no longer wish for that person to receive any part of a life insurance policy.  However, instead of updating the beneficiary designations with the life insurance company, and without consulting an experienced estate planning attorney, a policyholder sometimes names a recipient of the policy proceeds in their will.  Unbeknownst to some policyholders, life insurance companies are required to pay proceeds to the named beneficiary in the policy, even if the designation is contrary to the directives in one’s will.  So, while you need to update and review your last will and testament, you also need to review all non-probate assets, such as life insurance policies, annuities, and retirement accounts, to ensure that your beneficiary designations also remain applicable and coincide with your current intentions.

Keep a Detailed List of Your Assets with Your Important Estate Planning Documents

While leaving assets to family members and loved ones is thoughtful, if your loved ones do not know where these assets are located or how to find them, receiving an inheritance may turn into a nightmare.  Without a detailed list of information on your accounts, real and personal property, and other assets, your personal representative and beneficiaries likely will have to conduct their own search.  Not only is searching for assets very time consuming and often times frustrating, it also is possible that some assets will go undiscovered for years.  Keep a detailed list of your assets with your important estate planning documents, to ensure that all of your assets are passed on to your loved ones.

Name a Trustworthy and Reliable Personal Representative of Your Estate

The personal representative of your estate is the person who is responsible for paying your debts, filing your inheritance tax return, and distributing your assets to your named beneficiaries.  Being named an executor or executrix is considered an honor, but it also is a serious position that can be unbelievably time consuming.  Naming a child or relative simply because they are oldest, or perhaps the favorite, is not always the best idea.  If the person you name as the personal representative of your estate is disliked, not capable of doing the job, or not trusted by your beneficiaries and other loved ones, then your family could seek to have him or her removed from the position.  This is not only time consuming and expensive, it also can take its toll on your family for many years to come.

Get Answers to All of Your Questions – Contact Zwick Law

Estate planning is an important, proactive measure that you can take to preserve your legacy and ensure that your assets stay with and benefit your family after you are gone.  When you are ready to create or update your estate plan, consulting with an estate planning and estate administration attorney is highly beneficial.  The trusted attorneys at Zwick Law are available to help you determine the best ways to distribute your estate and protect your assets long into the future. Contact us today to schedule a free and confidential consultation at either our DuBois or Brookville office.

For questions relating to your estate planning needs, contact either C.J. Zwick or Matthew R. Zwick at (814) 371-6400.  At Zwick Law, we’re always here for you.[1]

 

 

[1] Disclaimer: The use of the Internet, Facebook and/or any other form of social media communication with the firm or any individual member of the firm does not establish an attorney-client relationship.  Time-sensitive information should be directed immediately to the office of Zwick Law at (814) 371-6400.

 

TOP THREE ESTATE PLANNING MISTAKES

Last Will and Testament

Protecting your loved ones by creating an estate plan is very important — it gives those closest to you clear instructions on how to carry out your final wishes. Unfortunately, even a small estate planning mistake can cause months or years of probate-related confusion. To avoid difficult and expensive problems, not only should you consult with any attorney to create or edit your estate plan, but you also should discuss your wishes with those closest to you. Being aware of these three common estate planning errors can help you better protect your beneficiaries and secure the legacy you have left to your heirs.

No Records

The records you leave behind are a vital part of administering your estate. Without proper documentation, it becomes difficult for your executor and heirs to locate property, recover assets, and verify the estate’s outstanding debts. In some well-known cases, the family was not even able to locate the will that was created, causing numerous problems for everyone involved. When working on your estate plan, be sure to include detailed information and records that explain the location of your bank accounts, life insurance policies, tax information, etc.  It also is vital that your family knows where your will and important documents are stored.

Choosing the Wrong Executor

An executor is someone who should be trustworthy and reliable — after all, your executor is responsible for distributing your assets and adhering to your final wishes as outlined in your estate plan. However, no matter how thorough you feel your estate plan is, being an executer is still hard work and extremely time consuming. You must choose an executor who has the ability to dedicate him or herself to the long process of managing your affairs. Your executor will need to work alongside your attorney; remain in contact with your beneficiaries; care for your assets; file your final tax return; and more. If you choose someone who does not have time to communicate with your beneficiaries; has a conflict of interest; or otherwise cannot perform the duties, then the probate process could turn into a disaster for your heirs.

Establishing a Trust Incorrectly

Establishing a trust is one way to pass assets on to your heirs without incurring large tax penalties or jeopardizing any government benefits that your heirs receive. However, if a trust is established incorrectly, then it could cause the same financial harm that it was intended to avoid. Even if the trust itself seems to be established with no problems, other issues such as appointing the wrong trustee; not designating your beneficiaries correctly; and not updating the trust on a regular basis, can cause problems for those you were planning to help.

Contacting Zwick Law to Review Your Estate Plan

Regardless of the size of your estate, contacting an estate planning and estate administration attorney is highly recommended. At Zwick Law, we are able to make suggestions based on your unique situation, to help you create the best estate plan for your circumstances. Our team is dedicated to providing clients with the assistance that they need. We understand that estate planning is a sensitive topic for most families — but it is necessary to protect your family and future.  Contact us at one of our conveniently located offices in DuBois and Brookville, Pennsylvania, to schedule a legal consultation. At Zwick Law, we’re always here for you.[1]


[1] Disclaimer: The use of the Internet, Facebook and/or any other form of social media communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Time-sensitive information should be directed immediately to the office of Zwick Law at (814) 371-6400.