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Recent Blog Posts
When to Consider a Premarital Agreement
A prenuptial or premarital agreement is the blueprint to a divorce. It is essentially a contract between two people who agree how assets and debts will be divided in divorce or death. Since the unfortunate truth is that one third to one half of marriages end in divorce, it is financially smart to consider drafting a prenuptial agreement just in case. While there is nothing romantic or cute about talking to a spouse about a prenup, it might be the best financial move available.
There are two kinds of property that divorce courts consider during a split. Marital property is typically assets and properties that have been accrued during a marriage, like salaries, bonuses, real estate, 401k benefits, etc. The other kind of property is termed as separate and is for property that was retained before a marriage. Separate property can also be inheritances that are received during the union. To decrease the possibility of creating a prenup for no reason, it is important to understand the reasons why people consider them in the first place.
What to Consider When Appointing a Trustee
Estate planning isn't easy, no matter what level of assets you have. It's important for every family to have a plan of what to do with assets upon death, no matter what level of income or the closeness of family relationships. A trustee is a person (or a member of a board) who is given control of powers of administration of property. This is usually a trusted family member or child. Hiring a competent estate-planning attorney is the most important step to planning your estate, but there are many factors to consider when appointing a trustee. The first, according to Probate & Property, a publication of the American Bar Association, is to consider the legal capacity of whomever you'd be interested in appointing as your trustee. It should go without saying that only competent adults can be appointed as trustee—a child cannot be appointed until he or she is of legal age. Laws vary slightly from state to state, especially if the trustee you're interested in appointing is a charitable organization or other financial institution. This is something to discuss with an Illinois estate-planning attorney.On a more personal level, according to Probate & Property, is to consider the specific personalities and skills of the individual who you're interested in appointing. These characteristics include "judgment, experience, impartiality, investment sophistication and track record, availability, accounting and record-keeping ability, and potential conflicts of interest." Appointing a trustee who understands capital gains is important, considering the recent Uniform Principal and Income Act, which "gives the trustee the ability to allocate some or all capital gains in a particular year to trust income." Family drama and relationships need to be taken into consideration as well—will one child create conflict for the other if he or she is named trustee (or not).
Illinois Divorce and Marriage Rates Continue to Decline
A recent article in Chicago Magazine analyzed data available on the state data portal in terms of marriage and divorce trends in the state of Illinois. While some of the data is not surprising, such as the rise of the divorce rate in the mid-1960s along with the rise of feminism, more recent data is surprising. Specifically, since the mid-1970's, not only has the marriage rate been in decline, but the divorce rate has been in decline, as well.
In keeping with national trends, the Illinois marriage rate is the lowest in recorded history, and continues to decline. However, the divorce rate today in Illinois, which is slightly lower than the national divorce rate, or 3.6 divorces per 1,000 couples per year, is at its lowest point since 1970. Despite the fact that there are fewer marriages than ever, the Illinois divorce rate is still at an all-time low. More specifically, first marriages that took place in the 1980s had a lower proportion of divorces with each successive anniversary, and that proportion of divorces was even lower for first marriages that occurred during the 1990s.
High Court Considers International Child Custody Case
The Chicago Tribune is reporting that the U.S. Supreme Court is considering a case involving an international child custody dispute in which the child has already left the U.S. On December 5, 2012, the Court heard arguments regarding the interpretation of the Hague Convention on the Civil Aspects of International Child Abduction, an international treaty that is designed to protect against the abduction of children to other countries, even by their parents. The outcome of this case could directly affect U.S. military personnel and other U.S. citizens who share children with foreign citizens and later separate or divorce.
In the case pending before the Court, Jeffrey Chafin, a U.S. Army sergeant, has appealed the ruling of a lower court that awarded custody of his now five-year-old daughter to her mother, Lynne Chafin, a Scottish national. The mother and child had lived in Scotland since 2007 due to Chafin's work-related travels. In 2010, the Chafins and their child reunited in Alabama briefly, but were unable to save their marriage. Divorce proceedings began, and Mrs. Chafin was deported for overstaying her visa. As a result, she sued pursuant to the Hague Convention in order to have her daughter returned to Scotland.
Some People Have No Will, Some Have Too Many
Some people still consider wills to be for the wealthy and rich, although there are many reasons to get a will made even if you are not a millionaire. On the flip side of that coin we have Thomas Kinkade, a millionaire, whose estate is being fought over, because he left more than one will. Forbes reported a story on this legal battle earlier this year.
Kinkade, who was a painter, died last April from an accidental overdose of alcohol and Valium. The 54-year-old was separated from his wife of 30 years, and he also had a new girlfriend, who he was living with. This is where the story gets interesting, because both the wife and the girlfriend have made claims for the estate.
Kinkade's girlfriend, Amy Pinto, has said she is entitled to the former family home in Monte Sereno, $10 million in cash, and some of the artist's work. To add fuel to the fire, Pinto was excluded from Kinkade's funeral because of the court battle, making the case all the more dramatic in court.
Political Views and Marriage
It has not been long since there was an election going on, and there was no way to avoid politics. Politics are an issue that often leads to heated conversations, which is why many people try to avoid talking about politics. How do you manage this with a spouse, though? There was a post on a Huffington Post Divorce blog that touched on this exact topic.
The blog said that a Match.com poll found that 57 percent would marry a person whose political views are considerably different from their own. Even though the majority of these would marry person with different political views, there is no way to know how these views will affect the relationship in years to come or how much friction there will be when the next election is at hand.
For weeks, people were fighting over who should be the next president, and it is not a surprise that democrats and republicans do not really see eye to eye when this question is raised. If things between you and your spouse get heated during the election, how will things go when one of you has to live with a president they did not want, knowing the other spouse voted for that person?
Divorce Rate Drops for Several Reasons
The divorce rate in Illinois has continued to drop, according to Divorce Magazine, and is likely due to several different factors, the economy being one of them. According to the magazine, "of the 43 states that have reported their divorces to the Center for Disease Control, the state with constitutional bans on gay marriage have the largest increase in divorce rates," and Illinois doesn't have a ban on gay marriage. The Northeast, according to the American Community Survey, has the lowest divorce rates in the nation, while the South has the highest. Illinois falls in between these two regions, with 8 per 1,000 men and women aged 15 and older.
A report from Medill Chicago substantiates this claim, citing specific data from Massachusetts and Iowa, the first two states to allow same-sex marriage. According to Medill, a research institute out of Northwestern University, in 2010 Iowa's divorce rate was 2.4 per 1,000 people, while the rate in Massachusetts was 2.5 per 1,000—the two lowest rates in the country.
The New Trend of Spiritual Estate Planning
Estate planning allows people to arrange the distribution of their assets upon their death. In these situations, there are often many people clamoring for ways to hold on to their departed loved one. Rather than allow unclear desires cloud a legacy, estate planning intends to honor last wishes. It also attempts to avoid any taxes which could decrease the assets held for dispersal to loved ones.
There is a new trend in estate planning, which has been especially popular with baby boomers. It is termed "spiritual estate planning" because it is based on a system of values that the planner wants to leave behind. An example of enduring values is leaving money to charity, which is up almost 20% from last year. These statistics have been collected by Charity Navigator, who monitors charitable donations.
Another example of this kind of estate planning is about how people are leaving or not leaving estates to family members. This can include second or third families if sons or daughters have remarried numerous times. Some people can choose to leave their estate to one child while cutting another child out of the estate altogether.
A Prenup in Illinois
When getting married obtaining a prenup isn't always foremost in a person's mind. No one wants to think about divorce settlements when walking down the aisle, but even if neither party has serious assets it's important for everyone to think about a prenuptial agreement. According to U.S. News and World Report: Money, "because state laws and judges vary, it can be impossible to predict how a court will decide to divide a couple's assets."
Illinois is one of 26 states that has enacted a variation of the Uniform Premarital Agreement Act (UPAA), according to the Equality in Marriage Institute. This means that wherever the prenup has been agreed upon, it will be honored in Illinois. This organization stresses that "some people may be hesitant to enter a prenup with their beloved, because they believe it destroys the romance and fantasy of their upcoming marriage." Instead, a prenup gives a couple the opportunity to share their concrete hopes and dreams for the marriage, and allows for a discussion of material expectations. The Equality in Marriage Institute cites that there are several key issues that should be included in the prenup, including but not limited to:
Estate Tax Slated To Change in 2013
According to the American Association of Retired People (AARP), "Congress hasn't made estate planning any easier with its ping-pong approach to the estate tax," and the federal estate tax rates are slated to change again in 2013. Finding a qualified and competent attorney is the most important step to begin estate planning. Not only can a professional help you to ensure that your inheritors get the most of your estate, but also help you to wade through the necessary and complicated paperwork and legalese. In 2010, the federal estate tax rate was zero—and has moved upward since. The New Year marks a new rate, unless Congress decides otherwise. Now's a better time than ever to begin the process.
Consider it a holiday gift to yourself and your family. According to the AARP, "until January 1, 2013, the amount of your estate exempted from federal tax is $5 million for individuals, $10 million for couples." These numbers don't include gifts of up to $5 million that are exempt before paying a gift tax ($10 million for a couple).
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