Colorado Estate Planning Blog

Friday, December 2, 2016

Common Law Marriage

Colorado has common law marriage, which can cause legal nightmares when an unmarried couple breaks up or one of the partners dies. Many people mistakenly believe that a couple has a common law marriage after living together for a certain period of time. Living together for a long period of time may help to demonstrate the couple's agreement to be married, but the law does not require a specific time period. If you want to ensure that you are never deemed to be common law married, you should consider signing a Cohabitation Agreement with your girlfriend. The agreement can spell out the consequences of a break up or the death of a partner, avoiding costly and protracted legal proceedings.
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Monday, November 14, 2016

So you need to disinherit someone…

In many situations, it is necessary to disinherit a child, grandchild, or other heir.   Perhaps they are an addict and you don’t want to harm them by leaving them enough money to overdose.  Perhaps they receive a disability income and you don’t want to kick them out of their governmental assistance program.  If you create a dynasty trust you can deal with many issues by setting up a trust for these beneficiaries making their inheritance available for their health, education, maintenance or support, but preventing them from having direct access to assets. 

If you do not want to provide this “beyond-the-grave” assistance, or if there are other circumstances dictating a disinheritance, you have the right in Colorado to disinherit anyone except a spouse; which can be done by agreement.
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Monday, October 31, 2016

You can never have too many back-ups

When drafting estate planning documents, I strongly encourage clients to come up with as many back-ups as they can for the people named to act as fiduciaries (in this case, people or entities named to act on behalf of someone upon their incapacity or death). Careful consideration should be given to naming the correct person for the job.  For example, if your eldest child is a spendthrift, you probably wouldn’t want to name them as first in line to handle your money when you are unable to do so yourself 

In addition to naming the person who is the best choice today, I suggest clients name as many back-ups as possible so that if one person can’t act, you have someone of your choosing to succeed them.  I counsel my clients to think outside of the box; if your children aren’t the right choice, is there a friend or other family member who is more fiscally responsible?  There are also professional entities with which I work who can be named as Personal Representative, Trustee or other fiduciary. 

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Thursday, August 11, 2016

What is estate planning?

Estate planning is the process of accumulating and disposing of an estate to maximize the goals of the estate owner. The various goals of estate planning include, but are not limited to: making sure that the greatest amount possible of a person’s estate passes to that person’s intended loved ones and beneficiaries; paying the least amount possible of taxes on the estate assets; and minimizing or altogether avoiding the extent of the probate process to which that person’s estate might otherwise be exposed. In formulating an effective estate plan, it is important to consider:

  • the size of the client’s prospective estate and what kind of assets (real, personal, monetary) are held in it;
  • who the client’s loved ones and intended beneficiaries are, how old they are, and whether or not any of them have any special needs or disabilities;
  • the type and extent of the potential estate or death taxes to which the client’s estate may be subject; and
  • what the client’s future goals and financial needs may be.

Many people believe that estate planning consists of nothing more than making a simple Will. A properly implemented estate plan can entail much more than that.
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Tuesday, August 2, 2016

Common Estate Planning Mistake #5 – No Health Care Directives

A health care directive is a written document that informs others of your wishes about your health care. It allows you to name a person ("agent") to decide for you if you are unable to decide.


Without a Health Care Power of Attorney, Living Will and HIPAA Authorization, the medical staff has no instructions for your medical treatment if you are unable to directly communicate your preferences. Do you want to be kept alive on a machine? Do you want heroic but expensive medical techniques to be used to prolong your life? You can make a stated preference on these items and other crucial items within your Health Care Directives, and also appoint a close friend or family member to make crucial decisions on your behalf.

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Thursday, July 28, 2016

Common Estate Planning Mistake #4 – Leaving Assets Outright to Beneficiaries:

Assets that are left outright to heirs and beneficiaries are exposed to creditors, predators and divorcing spouses.

Many of my clients choose to leave assets in trust for their heirs’ benefit. Assets left in trust are totally asset protected. The beneficiaries still have access to the funds but creditors, lawsuits, divorcing spouses, or in-laws who are spendthrifts cannot touch the assets inside the trust. This also helps ensure that when the heir passes away the asset goes where the original owner wants it to go and helps avoid unintended beneficiaries (like ex-spouses or estranged heirs).
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Thursday, July 21, 2016


      An outright inheritance to a child exposes that inheritance to a greater risk of loss. With a 50% divorce rate, multiple marriages, lawsuits and economic instability, your child’s inheritance is more vulnerable to unexpected loss than before. The money you leave your daughter may never reach your grandchildren.

    Many people haven’t thought about protecting the family money once it is inherited by their child. Usually because they have “good” children with no “problems” and don’t think they need this type of protection.
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Monday, July 11, 2016

Common Estate Planning Mistake #2 – Thinking Your Finances are Too Simple for an Estate Plan

Many people assume that their financial or family situation is so straightforward that they don’t need to draft formal documents, like a will. Sometimes they assume that establishing joint tenancy (sharing ownership in personal property, such as a home) or joint ownership over financial accounts is enough to protect their assets.

The reality is that no one’s life is as simple as it seems—and even if it is, you should still consider putting protections in place to help ensure that your wishes are known.

Here is an example of how something that seems simple can go wrong.  A widow adds the name of her adult daughter as a joint account holder, so that both of them have the authority to sign checks in order to pay bills.
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Thursday, July 7, 2016

Common Estate Planning Mistake #1 – No Estate Planning Whatsoever

You would be surprised how many people choose to let the State determine who will receive their assets at their death.  If you don’t have a Will, the laws of Colorado will determine who manages your estate, who gets your assets, and when they will get the assets (this is called intestacy). 
If you have minor children, you should have a Will to appoint guardians for your children if you and your spouse die before they turn 18. If you do not choose guardians yourself, you can almost be assured that members of your family will fight over this, creating emotional and financial turmoil for your children at the worst possible time. Ultimately, the laws of Colorado, often through a lengthy and expensive court process, will determine who becomes the guardian of your minor children.

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Tuesday, June 28, 2016

Spouse doesn't know finances

      Your surviving spouse will need to access money immediately to cover funeral expenses. There may also be hospital bills, and, of course, all of the normal expenses that come with everyday life. So that your spouse won’t have to search high and low trying to figure out where the accounts are located or how they can access money, you need to make sure your loved ones know where to find this information.

      Walk through all of your financial accounts with your spouse so she understands how to withdraw funds as needed. It’s also helpful to leave a few lists in a safe but easily accessible place:

  • A password list for all your online accounts and memberships
  • A list of all your accounts and memberships – both online and offline – along with any necessary instructions
  • A list of your estate planning documents and their location
  • A list of all lawyers, financial planners, accountants and others who worked with you

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