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>> Good evening.

I'm Sandy Thomson the host of Life.

I had the name of our show tonight here on PBS Fort Wayne.

I'm so glad you've joined this.

We've got some great guests here this evening.

We have a lot of expertize out here on the set with me and remember this is your show so I would love for you to call in with any questions that you might have.

>> Generally it's a legal show for us.

So we have two attorneys here tonight that can answer those questions and we have a life insurance expert with us here tonight.

Let me introduce you to them.

Heidi, I don't have to introduce you.

You've been on so many times and many years actually, haven't you?

>> A long time, yeah.

Hi.

Do you dear folks, if you happen to be tuning in for the first time here on LIFE Ahead, Heidi is an elder law attorney and introducing for the first time here on LIFE Ahead another elder law attorney and this is Brian San José.

>> Brian, welcome.

Thank you.

I know you were here in the studio with us once but not actually on the air.

>> So now you get to sit in the big chair.

Yes, a big seat and Heidi is also since our topic tonight is going to be estate planning and life insurance, Heidi is also invited Atiq with us here this evening a financial planner and expert in life insurance.

>> So those are kind of the general areas that we're going to be talking about once again, the phone number appears down here on the top bottom of the screen periodically in the next half hour or so.

Give us a call.

We always love to talk to our viewers.

>> All right.

Let's start out, Heidi, with you.

We're we're talking about estate planning and life insurance.

So let's talk about estate planning first and wills are always a big topic for us.

>> Wills are included in estate planning and what else a wills part of an estate plan, a health care power of attorney, somebody who can make health care decisions for a durable power of attorney or financial power of attorney somebody who can handle your finances for you.

>> Do you include financial planning at all when you when we talk about estate planning?

No, I mean I'm not trained as a financial planner but I push clients to get financial planning type assistance exactly as part of a whole package of putting forward.

>> It's such an important thing to have it all tied together.

Exactly.

You know, that's one of the reasons we call this show LIFE Ahead because we try to give you information and expertize in areas that might help you make some choices, good choices in your life , your head OK brain kind of expanding on the estate planning Heidi mentioned that you need to have a power of attorney in a health care representative explain what each of those jobs are.

>> So financial power of attorney is simply just allowing someone to make decisions for you in the financial realm and the health care representative form that we have allow someone to make health care decisions on your behalf and no way are these documents taking any powers away from you.

They are simply allowing someone else to make decisions with you and someone to communicate with and help you out or if you're not able anymore correct.

OK, and then what happens once somebody does pass?

What do you call the next level of taking care of your financial is typically an individual have a last will and testament or they could have a revokable living trust in place and typically those documents will handle the assets your assets at your passing.

>> OK, so you know we're talking about planning for your LIFE Ahead in terms of before you pass away when maybe you just need some assistance to kind of help you get all of your ducks in a row and then what happens after to help your family?

Heidi, let's go back and talk a little bit about having your estate planning and all of these things in a row if you have a beneficiary say you have a 401k or or even and we're going to talk to you about that in a minute here you have life insurance and you name a beneficiary.

What does that mean?

And do you have to have a beneficiary for different reasons?

>> So when you have an asset that has a beneficiary form attached to it, that beneficiary beneficiary form is really a contract with the company.

OK that says when you die this is where we're going to send your funds.

Yes, it trumps what your will says.

So it's very important that you have a beneficiary designation in place so that it doesn't end up reverting to the will.

Sometimes that happens if you don't correctly have a beneficiary named and that can have negative income tax implications in what way?

So IRA, that's a big factor I'm sure IRA are most effectively passed on to a person so that they can delay paying the taxes over a period of years if you mistakenly name your estate as your beneficiary or forget to do a beneficiary form which which would then just push it to your estate many times you have to take the money out over maybe you get five years to take it out but that in itself is a pain because you have to leave your estate open for five years.

Some people may not want to deal with having an estate for five years or they just take all the money in one year and pay all the taxes over one year which the more income that you have in a certain year pushes you into paying higher taxes.

>> So spread that out is helpful and those are situations where you might want to make sure you get some expert counsel on what might be the best thing.

Brian, you mentioned beneficiaries if you don't have a beneficiary for let's say your 401k or your life insurance, what happens if you haven't named anybody?

>> Typically those assets will fund into the estate once you pass away an estate will be opened up in your name and whether it's a 401k and life insurance policy or IRA, those funds will fund and will go into the estate and your will will take over will dictate how those funds go.

But typically you might want something else you might have other wishes for that IRA or that life insurance policy and I would add to when it goes by beneficiary designation it just happens you don't have to work through the estate process through the court.

>> It's just simply easy is a very simple yes.

OK, I think I know the answer to this because we've discussed it before.

>> But Heidi, if you have a beneficiary named on your life insurance or your 401k but you have somebody else named to get the funds in your will which takes precedence the beneficiary form for that particular asset.

>> So it's kind of important to make sure that there was a match or it is or at least you've made a conscious decision to not make them match you.

>> OK, and that could be the case, right?

>> Right sometimes.

Yeah.

How do you set up a beneficiary, Brian?

Typically each company has their own beneficiary designation form and you would fill that out.

You would say the name of the person your relationship when they were born put their address down and that's how you would fill it out accordingly and how much what percentage you would want that beneficiary to receive.

>> OK, and you could name more than one person correct.

But would you normally do that by amount or by percentage of what that asset is usually by a percentage.

OK, a lot of folks have their spouse to receive one hundred percent of the assets but if they do outlive their spouse then they'll split it up accordingly.

Whether it's among children or grandchildren however they may see OK and you can change that if you I mean like if your family situation changes you could change your beneficiaries ,correct?

>> Yes.

OK, and you have to be vigilant about it.

You have to do it if you let that go by the wayside and forget about it then whatever is the most whatever that company has on file, that's where the money will go.

>> Yeah.

Regardless of whether that's really what you want to do or not.

We have a phone call already.

I'm so glad, Rosemary, that you're watching us here this evening and what is your question, Rosemary, for our panel this evening?

>> OK, I have an I are a can of course my husband was a beneficiary.

He passed away and on on the policy says on the beneficiary children born to the marriage do I need to file their names and so on so forth or will this be OK?

OK, that's a good question.

I'm sure, Rosemary, there are other people watching that might have that same situation.

How to guide her?

>> Heidi, I would recommend that you reach out to the company that has that asset and talk it through with them.

They may want you to actually fill out a form that assuming you want the children that actually list the children's names, their addresses, their Social Security numbers which will make things much easier and more streamlined for them.

>> Yeah, and and again, speaking of digital lunches, vigilance as Brian mentioned, maybe things might change your your beneficiary I think you said says to children born of that marriage something like that.

OK, but again maybe somebody does that and then 20 years down the line they've remarried to somebody else now they have a blended family or they've had another child or two but they didn't go back and change that.

So yeah, make sure you change things accordingly is that hopefully and I'm eighty eight so I imagine that I'll be able to that's pretty well you never know Rosemere never know.

Oh gosh thank you.

Thank you very very much.

You're welcome and thank you for watching Rosemary.

I love that.

OK your turn to for the hot seat here at we've mentioned life insurance a couple of times and having beneficiaries for that just life insurance for in general.

Why do people have it and what do most policies or plans entail?

>> What kind of things do they cover ?

Are they all the same now?

There's a lot of different types of policies.

Most people have it to protect against loss of income so you know, if a spouse passes away you want to still have that income coming in to pay for the household goods and you know, so the other spouse doesn't maybe have to go back to work or you know, short on money and then also maybe to pay off liabilities so you know, maybe they want to pay off the mortgage or the car loans or pay for their kids college, you know, looking in advance.

So then the spouse who's affected by the death isn't as out, you know, because of the loss.

>> Uh huh.

OK, all right.

We talked a little bit about this before this show.

I had some questions too concerning this.

So what's the difference between term life insurance and what's the other one called permanent permanent permanent.

>> OK, what's the general difference?

Well, permanent life insurance came really became hot in the nineteen nineties so a lot of people a lot of my clients will come in and they'll have permanent policies and you know it changed in the early 2000s over to the term term is a specific period of time time limit it's also a specific amount so you have a beneficiary amount and you also have a set premium so that premium doesn't change over time where they are how old you are I mean you just progressively it's the same if you have a twenty year term it's going to be the same premium each of those twenty years.

>> OK, how do you decide which is right for you?

Are there different elements or reasons or situations?

>> Yeah, that's a good question.

So you want to protect against the loss of income so let's say that you're thirty five years old and you're projecting to work until you're sixty five so you might want to take out a thirty year term to cover you for that entire sixty five year lifespan.

>> OK so depends on the situation your age, your life style the cost of the insurance goes up so if you if you do a twenty year term at the age of thirty five and then you have to redo and get another term at fifty five you're going to pay significantly more in premiums and you may not want to do that at that stage of your life .

>> OK so again it'd be good to get some counseling before you make that decision.

Larry has called in this evening.

Hi Larry.

We're so happy you're with us here on LIFE Ahead.

>> What kind of question do you have for us tonight?

Larry, we'll see if you can stump head over here to thank you.

I have a Eyeborgs that I bought in 2000 and they're my wife's in my name but sh's deceased.

I have three daughters.

I won't leave them.

I belong to them.

I've been told they have to go through probate.

Is there a way I could do that without going through probate?

>> Heidi, this is a question for you and that's a legal question.

So the fact that your wife has died because you're a joint owner with her on the bonds that shouldn't cause a problem.

But in order to name your daughters as the beneficiaries of the bonds, you need to set them up to be podi or pay on death if you do that, then the bonds can go straight to your daughters without having to go through probate.

Now specifically how you make those bonds poddy ATD you know the answer to that.

>> I believe he'll have to go to the bank the bank go to the bank where the bonds were the bonds are issued in I believe so, yes.

>> And fill out whatever forms they have to to name their beneficiaries, right?

>> Yeah.

Or maybe the Treasury direct website could help you figure that out too.

So OK. All right that helps.

>> OK thank you Larry for watching us here tonight on LIFE Ahead and and good luck with changing that over to your daughters.

OK, let's go back let's go back to you at as far as life insurance, how do you decide how much you need?

Again, this is going to be an individual situation, right?

>> So typically the the rule of thumb is ten to twelve times your income so ten to twelve times your income.

>> Right.

OK, so if you're making fifty thousand dollars a year you're looking at 500 to 600 thousand.

OK, you may also want to include, you know, the cost of paying off the mortgage and any liability that you have.

So it's always better to go with more insurance than with less insurance because once you get the insurance if you want more you have to go through the same process again to get additional insurance.

>> OK, all right.

That makes a lot of sense.

James also called in with a question and he says What age should I start to think about life insurance if I'm single and I have dual assets and that happens sometimes they have few assets when you're single and young.

>> So that's this is one of the times when I would not recommend life insurance.

So OK, because once again if he's single and has no children or nobody dependent on his income then there's really no need for the life insurance.

>> OK, all right good answer.

And again, there are so many different variables in terms of what you might need or or require in terms of life insurance or estate planning situations.

>> Let's go back, Heidi, to estate planning questions as far as fiduciary do they need to sign papers or consent to be to be on your estate planning?

>> You know, believe it or not, they don't have to consent.

You can name them and they they don't even know that you've named them now is that the best way to handle it?

I don't think so.

You should have a conversation with the people that you are naming to help you in the event of incapacity or death just to make sure that they are willing to to perform that function so that if they say no, you have the chance to go find somebody else.

>> Good point.

Yeah, good point.

>> Should you have the same person, Brian or for power of attorney or health care representative or can you name two different people?

>> It's certainly a possibility.

Every family is different and you might have a child who is really good with money but not the best regarding sympathy for your care.

It's a safe word.

Exactly.

So you might want them to handle the finances but have another one of your children handle your medical decisions or you might want more cooks in the kitchen.

You might want it to be a joint decision and you might have your spouse and or all of your children depending on your family situation.

It just it depends.

It's nice to talk to the attorney and kind of ironed out those ironed out those details to see what's best for you.

>> Exactly.

And again, with everything in life it could change, right, Heidi?

So what happens say you know, Brian's set up an estate planning situation for somebody in their life situation changes in the next five years.

Do you have to go back and do it all over or make an amendment to your room?

>> What do you do powers of attorney we generally just redo them, have signed a new one a will.

You can either redo the will or do what's called a console where you just are amending one little section.

It's not too big of a deal to update people.

It's not that hard to do.

All right.

All right.

>> Good to not tell people to in thinking about estate planning you use the the term five years.

>> That's a good way to look at it sometimes.

What do you mean you use it you think just try about trying to look out five years don't look out fifty or twenty impossible too much you can't anticipate everything that's going to happen so just think about five because if things go differently we can switch it OK. >> All right.

I want to talk about families again here.

>> Let's say that you've named somebody to be trustee or guardian of your children should you pass away or have some sort of situation and you have set up funds for them to take care of your children, how can you be sure they're going to take care of them or pay for what you wanted them to so generally people who have kids you create a trust for those children, OK, you in your will you you embed the trust in the will and you say what the rules of this trust are going to be.

For example, you might say I want the money to be used for my children's health education support maintenance and at some age they get what's left thirty twenty five whatever that age is.

And by putting things in a trust the person that you name as trustee has a fiduciary duty to follow the rules of the trust and you can be as specific as you want in that direction.

You could say give them money for a wedding gift, give them a down payment for a house, give them 10 percent of something to start a business.

>> You can be as intricate with that as you would like to and you could even name timelines like you know, give them so much that when they're twenty one the next Merklinger thirty five or exactly Bryan shaking his head so that's the way it works certainly so yes.

OK and sometimes that's a good reason to yeah.

Let's go back to life insurance should you have life insurance for your children or your spouse for children we usually don't recommend it just because there's no loss of income there once again.

So OK, in that case no for the spouse.

Yes.

So if you think of a situation where maybe one spouse travels three days a week and and is out and the other spouse is at home taking care of the home and the kids and everything around, you know that spouse at home passes away you might need income to bring in somebody to help out around the house to pick up the kids to home school or whatever it may be.

So there is a loss even though there's no income there, you still want to have some protection because that person who's out traveling that's their job and they may not be able to come back home and take care of the kids.

>> Yeah, that makes sense.

>> Our life insurance incomes are taxable or how does that work?

No, not at all.

>> So whatever the policy is, that's what you get.

Correct.

OK, all right.

Good to know I didn't I didn't know that.

>> So seized your life lifesaver here tonight in terms of answering those questions.

What about physical examinations?

I think that's like a concern for a lot of people if they're going to get a life insurance plan, they need to have a real intense physical exam.

>> Always the case.

No, it's not so on lower valued policies recently they're going with no exam on this.

>> So yeah, they're going to be, you know, fifty hundred thousand dollar policies if they get up to the 250 or above, typically they will have an exam and it's usually just a blood draw and blood pressure and things like that pretty simple get to have an annual physical anyway.

>> Right OK all right that doesn't sound too and they'll come right out to your house for work and and do it.

>> Oh really?

Yeah.

Oh all right.

So your life is easy if you look at it that way Heidi in terms of estate planning and designating designating somebody to be a trustee or whatever, what are some things that you let's say some of our viewers are thinking about starting to do some estate planning.

What do they need to know or bring to you?

You mentioned earlier if you're going to name of beneficiaries, it's good to have their Social Security numbers and their address and whatever what other documents or whatever should they bring to the attorney?

Yeah, I mean what we do is we send questionnaire out to pull all that information out of our client prior to the first appointment.

OK, we get all the vital statistics of the family members where they live if they have any kind of disability or problems that we need to be worried about and then we get a lot of detail about financial information, what your income sources are, what your assets are and that just it really helps have a very productive planning session to help you think about what your goals and objectives might be.

>> Right.

By having people start to think through it and physically filling out forms and whatever you can think you know people who come to us which we don't care without a form.

>> Yeah, a hole first meeting we're just now what's your middle initial and yeah.

Where does your child live and do you know their address.

Let me look at my phone and see exactly so we can avoid all of that if you bring it here.

Yeah.

>> All right that makes sense Brian say somebody is coming to you and you know for estate planning an elder law attorney but things change in their lives five years down the line .

>> What do they do?

Do they come back to you and redo those documents?

It depends.

We tried to make our documents as flexible as possible to try to account for everything.

However, there's no way to account for all of life's happenings.

So usually, like Heidi said, making a changes as simple as as coming in and signing a smaller cortisol but events that could happen is having more children come into the family adopting a child.

Yeah, buying a home unfortunately divorce things like that to keep in mind that you may want to revisit your estate planning documents.

>> OK, what happens by the way and people are concerned about this obviously if you don't have a will, Heidi, what happens to your assets so that the state doesn't just come take them, which is what a lot of people think.

I know that's why I brought it up.

I think that man yeah.

>> But there is a statute in Indiana that says who gets your property if you don't have will it's specified like whatever your spouse or their children or yeah.

>> The shotgun or the weird one is that if if you're married and you have an asset in your own name, half goes to your spouse and half goes to your kids which is usually not what people want to have happen.

So a will is better but if you just don't have one somehow it gets to your relatives in some combination of yes what if I don't really have any assets?

>> Do I have to have a will?

Brian, I would recommend so you you might want you might have family heirlooms perhaps or sentimental gifts that you want to give to certain people that you're passing so that a will is another vehicle to get these family heirlooms or sentimental items to people that you choose.

>> Do I understand that on the back of your will at the end of your will or whatever, Heidi, you could actually make a list of maybe some of these items like like we're talking about here oops.

>> We're almost out of time very quickly you can do that.

You make a list of who's going to get what you can.

>> OK, time went so fast when we had so many more questions we'd like to know but maybe they'll be back again and answer your questions and certainly a lot more than I have as well.

Well, I want to thank Heidi Adair and Brian, thank you so much for actually being out here on the set with us this evening and I hope that you've enjoyed your first time on like the head I have.

>> Thank you.

And we hope to see you all again next Wednesday night.

>> New topic in new guest for us.

Meanwhile, stay safe.

Stay healthy.

Good night