Estate planning is a method for preparing yourself and your family for what happens after your death. Estate planning also allows you to plan for unexpected incapacity. Planning ahead gives you a chance to specify who will inherit your property after your death while helping you to reduce the taxes your estate will have to pay. If you become temporarily or permanently incapacitated, your estate plan can provide the protection you and your family will need. When it comes to Los Alamitos estate planning for veterans there can be special issues to consider. Here is what you need to know.
Avoiding common estate planning mistakes
Unfortunately, estate planning mistakes can be quite common. Whether it is a failure to properly execute a will or to update beneficiary designations on life insurance policies or retirement accounts, these mistakes can be costly. The good news is, our attorneys can help you to make sure that Los Alamitos estate planning for veterans is done properly.
But, when it comes to veterans, there are unique and often irrevocable estate planning choices that must be made. Those choices are typically unfamiliar to tax or financial advisors and estate planners who are not familiar with military issues. For that reason, it is best to consult with an estate planning attorney who is experienced and knowledge of these unique issues.
Tips for Los Alamitos estate planning for veterans
There are a few tips that we can offer with regard to Los Alamitos estate planning for veterans. First, it is important to recognize that military retirement pay is guaranteed income, which means it should be considered a low-risk asset. Second, veterans can elect to use the Survivor Benefit Plan (SBP) upon retirement, which provides their surviving spouse continued income up to 55 percent of their retirement pay. Depending on the percentage chosen by the veteran when he or she retires, they will be required to pay a pre-tax premium for the future benefit. Also, veterans who have eligible dependents, including disabled children, can elect for them to receive a percentage of benefits after the veteran and surviving spouse pass away.
Life insurance considerations for veterans
Another important consideration for Los Alamitos estate planning for veterans is how to handle life insurance. Primarily, the issue is whether to replace their Serviceman’s Group Life Insurance (SGLI) with Veterans Group Life Insurance (VGLI). Usually, for veterans in good health, it is possible to find better life insurance options than Veterans Group Life Insurance. One thing to consider is the veteran’s particular needs after retirement, along with his or her overall health status and insurability. Since Veterans Group Life Insurance is not an automatic election, veterans should explore all possible options before making that election.
Veterans pension benefits
The veterans pension program was originally established as a way to provide supplemental income to veterans who were required to change their career goals in order to serve in the military. In light of the financial security, most veterans had to relinquish when serving, the pension program was created as a need-based program. It was meant to supplement the social security income totally disabled veterans receive.
VA benefits are tax-free and can offset your client’s military retirement pay, depending up on the disability rating. Veteran spouses can receive a portion of VA pay after the veteran’s death. For instance, if the veteran has had a 100% disability rating for 10 years or longer, then the spouse will be entitled to Dependent Indemnity Coverage (DIC).
Let our estate planning attorneys help you prepare
The job of an estate planning attorney is to provide expert legal advice. Estate planning is an important area of the law that typically involves drafting complex legal documents. Those documents can result in serious legal consequences is not drafted properly. For that reason, it would always be wise to consult with an expert when you begin your estate planning.
Understanding the complexity of Los Alamitos estate planning for veterans
Clients should not underestimate the complexity of the estate planning decisions involved in Los Alamitos estate planning for veterans. As clients reach military retirement, there are certain transition assistance programs that are available for each branch of military service. It is always a good idea to seek the advice of professionals with experience working with military elections and VA benefits.
If you have questions regarding estate planning for veterans, trust contests, or any other trust administration issues, please contact the Schomer Law Group either online or by calling us in Los Angeles at (310) 337-7696, and in Orange County at (562) 346-3209.
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