I started this blog with the belief that blended and step families need a place where they are supported and understood. Having been raised in a blended family, I understand all too well how difficult the dynamics can be. My parents are a second marriage and both of them brought children from exes into the marriage. I am their only “ours” child. This space is designed to be a positive, supporting environment where blended families can get the tools and resources necessary to work through their unique issues and thrive through the storms that are sure to come.

By training I am a financial planning attorney. My practice, Reflections Life Planning, is a financial and estate planning firm that focuses on helping blended families with adult children and the adult children of blended families to build the life and legacy that they deserve. I am a mother of 3 adult children. My nuclear family failed (first two children’s father), my first attempt at blending failed (youngest child’s father), and now I am on the journey again to blend with my current fiance and his two children. This time I am determined to get it right!

In the context of blended families, financial and estate planning are a lot more complex. How do you blend finances if at all? How do you determine who gets what in the event of the death of one or both spouses? How do you handle assets that you had prior to the marriage? What if there is a large age gap between the new spouses? What if there is a huge financial gap between the spouses? Who makes medical decisions if one or both spouses were to become incapacitated? How do you handle inheritances from other family members? How do you work through the inevitable fighting that happens over the step and biological children? How do you determine whether or not you need a prenuptial agreement?

These and many other questions will be answered through this blog. I will also create courses, books and materials to help you navigate the financial and legacy aspects of things as you go on this blended journey.

I encourage you to get involved, get your questions answered, make suggestions for content that you would like to see and invite others to participate in our forum. Buckle up and let’s support each other in getting this blended family thing down packed.


FB & IG: @reflectionslifeplanning

The Importance of Life Insurance in Building a Solid Financial Foundation

(Originally published June 5, 2019)

When I think of life insurance, I think of it as one of the most important aspects of my financial life.  If something were to happen to me, I would want my children to be able to pick up the pieces and not have to worry about how they are going to pay my debts or final expenses.  I would also want them to have a token of my love that they could use to solidify their own financial foundations.

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Photo by Natasha Fernandez on Pexels.com

I see so many GoFundMe accounts where people have died leaving their friends and family to scrape up funds to bury them.  This puts an unnecessary strain on the family that could have been resolved by doing the responsible adult thing to do and purchasing a life insurance policy.  Think about how those you love would be impacted by your death.  It is not only the immediate impact of losing you and your income, but it is the devastating blow of realizing that they will never get to see you again in this lifetime.

There are tons of different types of life insurance designed to fit any budget and need.  I am only going to discuss a few of the more common ones that I see people using:

  1. Whole Life– A permanent life insurance policy that builds cash value at a predetermined fixed rate.  Premiums are level, do not go up, and are paid either until the insured dies or turns 100.  If the insured lives to age 100, the face value of the policy is paid out to them. Since whole life policies build cash value, insureds are able to borrow against that amount.  This is the most expensive type of insurance.  Most people would be better off getting a term policy and investing the difference in premium.

Ex- Sue purchases a $100,000 whole life policy at age 48, pays her $425/mo premium until age 100. At age 100, Sue would get the $100,000, which is the policy’s face value.  If Sue were to die prior to age 100, her beneficiaries would receive the death benefit less any outstanding loans and interest if any was borrowed from the cash value. 

Ex 2- Gilda purchases a $250,000 whole life policy at age 25, pays her $300/mo premium until age 42 when she passes away from a rare cancer.  Gilda’s beneficiaries would receive the death benefit, which is the $250,000 face value of her policy less any outstanding loans and interest from the cash value if she borrowed against it.

  • Term Life– a temporary policy that is only in force during the “term” of the policy.  The term can be anywhere from 1 to 30 years.  This type of policy would pay the death benefit to the beneficiaries if the insured died anytime during the term.  Unlike whole life, it is pure insurance and does not build any cash value.  For this reason, it is significantly cheaper than a whole life policy.  Also, a term policy would not pay anything if the insured died outside of the stated term.

Ex- Mike purchases a $500,000 20-year term life policy at age 32, pays his $60/mo premium until age 38 when he tragically dies in a car accident.  Since he died within the 20-year term and his premiums were paid, his beneficiaries will receive the $500,000 face value of the policy.

Ex 2- Greg purchases a $1,000,000 10-year term life policy at age 53, pays his $100/mo premium until age 63 and has a stroke at age 64 and dies.  The 10-yr term would have expired at age 63, so his beneficiaries would not receive anything from the insurance unless he had renewed the policy for another term.  

  • Group Life– group life insurance is generally through an employer or affinity group like the UAW, a fraternity, or something like that.  You cannot form a group solely for the purpose of obtaining life insurance, so it is usually going to be a part of an employer’s benefit package and is usually at least a year’s worth of income if not more.  The group policy is only in force while you are affiliated with that employer, fraternity, etc.  Once your affiliation stops, the policy is canceled if you do not keep it in force by paying premiums on your own.

Ex- Sean works for ABC Co and makes $140,000/annually.  Her employer insures her for up to 2x her annual income, so $280,000.  She leaves ABC Co and starts her own firm.  She is no longer covered under the group policy and nothing would be paid out to her beneficiaries on the policy if she passes away.

Ex 2- Kerry is a part of the Big Bad Boys Union and they offer group coverage to union members.  He takes out a $300,000 policy under the Big Bad Boys Union group and pays his premium (which is much less than what he would pay if it were not under a group).  He maintains his BBBU membership and group policy for many years and eventually dies of old age.  His beneficiaries would receive the $300,000 face value of the policy.

Why is any of this important? Count up the cost for your family of paying off any debts that you owe, replacing your income (for the remainder of your life expectancy), and paying your final expenses.  What if you have a mortgage, childcare expenses, college tuition, or if significant life adjustments would need to be made to replicate your household contributions?  The number may be a lot higher than you think.  A good rule of thumb on calculating how much life insurance you need is about 10-12x your annual income.  You can use any of the various types of life insurance out there as long as you understand exactly how they work and what the numbers mean to your family.

Life insurance is a key foundational piece to any solid financial base.  It gives your loved ones a leg to stand on in the event of an untimely death, and a way to pass on some wealth to the next generation even if you have not yet accumulated much in the way of assets.  I personally have all three of the above mentioned types of policies to shield my family from at least the financial blow of my premature death.  Talk to your financial professional today to see what is right for you and your family.  If you haven’t already, secure your life insurance and begin one of the first steps to securing your legacy.

Contact us to discuss strategies for how to plan your legacy: info@reflectionslifeplanning.com

How to Title Large Purchases

(Originally published July 3, 2019)

Photo by Binyamin Mellish on Pexels.com

When making a large purchase people do not generally give much thought to how that asset is titled.  They will most likely default to owning it in their own individual name, or if they are a couple, in both of their names. What if I told you that how you title your assets has a huge impact on your life and legacy planning, and that you can avoid a few costly mistakes just by properly titling your assets.

If you title an asset in only your name and die without doing some other planning, your family could end up in conflict and in court trying to sort through your wishes for that property.  Here are some ways you could title your assets and keep your family out of court and conflict:

  1. Designate beneficiary/beneficiaries. If it is a house, you can put a transfer on death instruction on the deed and upon your death, the house would be transferred to your beneficiary/beneficiaries.  This could get tricky if there is more than one beneficiary because they may not agree on what to do with the asset.  One beneficiary may want to sell the asset while the other wants keep it in the family.  A better option if you do not want the beneficiaries to fight or if you do not want them to get the asset outright for one reason or another is to title the asset in the name of a trust.
  2. Title asset in name of trust. Most assets can be titled in the name of a trust.  A trust is an agreement between the Creator/Grantor, the Trustee, and the Beneficiary.  The Creator/Grantor is the person who establishes the trust.  The Trustee is the person who manages the assets in the trust.  The Beneficiary is the person who the trust is set up to benefit.  Generally, while a person is living, they will act in all three capacities.  A trust can be revocable, giving you the right as the Creator to change it at any time, or irrevocable, which means it is a lot more difficult to make changes.  A revocable trust is created and funded during your lifetime and you can use it to hold title to your assets.  When assets are placed into an irrevocable trust, they are literally removed from the person’s taxable estate. This is why it is more difficult to make changes to an irrevocable trust.  Both revocable and irrevocable trusts can be used tactically to protect assets, plan around possible tax issues, and pass wealth down to the next generation.    
  3. Title asset in more than one name.  If you want the asset to go directly to your spouse or other person named as a joint owner of the asset, you can simply put their name(s) in the title of the asset as a Joint Owner with Rights of Survivorship.  Anytime you see the language “with Rights of Survivorship,” it generally means that the asset will pass to the survivor outside of the probate court upon the death of the joint owner.  This works well with couples.  Some elderly people who have not done a lot of planning will also add their children to their accounts as joint owners to ensure a smooth transition for their children. 

As you make your large purchases remember to consider how you are titling those assets and do what works best for you and your family.  You want to choose the path that costs you the least unnecessary money, protects your family wealth, and keeps your family out of court and out of conflict. 

Considerations When Planning Your Legacy

(Originally published May 15, 2019)

This article is not meant to be legal advice.  It is for general information purposes only.  Always consult an attorney licensed in your state for specific information since laws may vary from state to state.  

Contrary to popular belief, you do not need to be wealthy in order to plan to leave an honorable legacy for your family.  Legacy or estate planning is the act of creating a financial strategy for gifting your assets (no matter how much or how little) to a family member, friend, trust or charity of your choice when you pass away.  It is an intentional act that requires some proactive steps to make your wishes known.  If you do not take the time to do some legacy planning, your respective state will make those important decisions on your behalf via the probate process and intestate succession laws.  Intestate succession laws vary from state to state, but they are essentially a plan based on the statutes of that state for where a deceased person’s assets go when that person has not laid out a plan of their own. 

When planning your legacy, here are some key essentials to think about:

  1. Titling of your assets.  You can strategically title your bank, brokerage, and other assets to designate a beneficiary directly on the account.  A bank account can be titled Payable on Death (POD), and a brokerage account can be titled Transfer on Death (TOD).  These designations will ensure that assets pass directly to your beneficiary without going through the probate process.  There are other titling strategies as well such as Joint Tenants with Rights of Survivorship (JTWROS) where two or more people are owners on an account and the account automatically passes to the surviving owner(s) when one of the joint tenants dies.  This is yet another way that assets can pass without going through the probate process.
  2. Designating beneficiaries on life insurance and retirement plans.  It is important to keep the beneficiaries up-to-date on your life insurance policies and retirement plans.  It is so easy to forget this important step when a life event happens.  Not updating a beneficiary can cause a lot of trouble if there was a divorce, additional child born, a named beneficiary predeceases you, or a myriad of other life events happen (as they tend to do).  Review your beneficiaries often and make sure it still aligns with your current wishes.
  3. Your healthcare decisions in the event of incapacitation.  Setting up a Healthcare Proxy or Healthcare Power of Attorney gives the person of your choice the authority to make healthcare decisions on your behalf in the event that you are unable to speak for yourself.  Additionally, setting up a Living Will outlines your wishes in the event that you are placed on life support or there is a particular life-saving treatment that you do or do not wish to receive.
  4. Your financial decisions in the event of incapacitation.  Setting up a Durable Power of Attorney gives the person of your choice the authority to make financial decisions on your behalf in the event that you are unable to speak for yourself.  Choose this person wisely because this essentially gives them the power to act in a financial capacity as if they are actually you.  They can pay bills, open or close accounts, deposit and withdraw funds- all of the things you could do if you were able.
  5. Your last will and testament.  This legal document outlines your wishes on how you would like your assets to be distributed upon your death.  It can also outline your wishes for the care of minor children, pets, or other things that are important to you.  Additionally, it should outline instructions on how you would like your remains handled (buried, cremated, etc).  A will is activated upon the death of the Testator (person who created the will) and it must go through the probate process.  The probating of a will is a public procedure and the will becomes a part of the public records.  Even if you do no other legacy planning, writing out a will is an important legacy must.  Otherwise your loved ones and assets are left to the statutory scheme of your state for distribution that may not be aligned with your wishes.
  6. Whether it makes sense to use a living trust to hold your assets.  A trust is a legal arrangement between the Grantor (person creating the trust), Trustee (person managing the trust, many times it is the Grantor), and the Beneficiaries (the person or people for whom the trust is designed to benefit).  It is basically your way of giving specific instructions on how you would like your assets managed and distributed during your life and after your death.  It is important to point out that a living trust must be funded prior to your death in order for it to be effective.  Setting up a trust is just one step in the process.  You then need to retitle the assets that you want the trust to manage into the name of the trust.  Trusts can be revocable (able to make changes) or irrevocable (very difficult or impossible to change).  Trusts are highly complex and not everyone needs them.  Unlike a will, which is pubic and has to go through the probate process, a trust is private and does not need to be probated.
  7. Consider your tax situation.  For some people it makes sense to hire a tax professional to sort through the maze of tax planning.  This is especially important for people with businesses, a higher net worth, and any other special considerations. A tax professional can help you plan how and when to pay your taxes as well as which deductions make the most sense for your unique situation.

These are just a few things to consider when thinking through your legacy plan.  There are also other considerations if you have minor children, a special needs family member or an elderly person in your care.  Building and leaving a legacy is a highly personal process that takes a lot of maturity and patience to complete.  Many people put this important step off since no one really wants to think about the day when they will no longer be here.  Take action and set up your legacy plan today with the key essentials above in mind.

Reach out if you need help establishing your legacy, raina@reflectionslifeplanning.com

Build and Support Black Businesses (Race Relations Pt 2)

In my last blog, I wrote about how something has got to change. It is true that we are at an apex with the way that Blacks have been treated in America and people are just plain tired of it. Now it is time for lasting solutions that will empower Black people for generations to come. The progress is starting with new laws going into effect such as Breonna’s Law, which was passed unanimously in Kentucky.[i] This law does away with the “no knock” warrant that police used to break into Breonna’s home and murder her in her sleep. Although that is a move in the right direction, there still have been no arrests in Ms. Taylor’s death and the officers involved remain employed and on administrative duty. There is still lots of work to do!

Over the weekend we lost yet another Black life in Atlanta, Mr. Rayshard Brooks.[ii] This has got to stop! Another unnecessary execution of a young black man by police officers commissioned to serve and protect him. This system as-is is failing so many black and brown people. It goes deep into our psyche and infests every area of our lives; at work, in our family lives, in society at large, in politics, and literally everywhere we exist. Surviving as a black person in America is no small feat. So how do we empower ourselves and fight back?

I know you remember the Bus Boycott of the 1950’s pioneered by the late great Mrs. Rosa Parks.[iii] For one solid year African Americans banned together and refused to ride public transportation until something changed. When you are fighting a racist and capitalistic system that has been set up against you from the beginning, you must fight in a universal language, money. Why do you think it was so important that Black Wallstreet was destroyed when it was destroyed?[iv] The Black citizens were becoming increasingly wealthy and independent, which meant wealth and independence for their offspring, which meant they did not need the goods and services of their oppressors. This meant less wealth for their White counterparts and that was a threat to their sustained power. How can you control an independent people? It is extremely tough to do that when they do not need you for anything.

Pay attention to how the banking industry has historically treated its Black customers. They do not mind taking our money, lending it out to everyone but us, and charging us higher fees/interest for their services. It is not unheard of for Black people who have been clients at certain banks for years and have what they think are great relationships, to be denied loans for their homes, vehicles, and businesses.[v]  It is also common when we are approved for such loans that despite having similar credit risks to our White counterparts, we pay more in fees and higher interest rates. This being said, banking Black is becoming increasingly more important. There are Black bank or credit union options in most major cities where you can take part in not only supporting a Black business but empowering the Black community as a whole.[vi]   

My friends have been connecting me with so many Black businesses that I never even realized existed.[vii] Now more than ever it is important to support Black name brands that are truly Black owned. Think about some of your favorite brands and check the ownership. How has that company treated Black people in general? How are they supporting the Black communities that support them? How diverse are they at the upper levels of management? We really have to watch where we are spending our dollars and who we are truly empowering. We have the power and have had it all along. It is up to us to harness that power and band together in support of each other. If you see a brother or sister working in their business and you are in the position to support them, lend a hand. Realize that so many of us lack the support and resources necessary to truly get our businesses going. It is with the help and support of our communities that we can change this narrative and begin to empower ourselves.

What business ideas do you have? What Black businesses do you know of that we can support? What types of things would you like to see the Black community do collectively to support and protect ourselves and future generations? I for one am a huge proponent of Black people properly completing their legacy plans. I think this is an important step to empowering the next generation. Having a properly executed Will, Power of Attorney, Medical Directives, and possibly even a Trust puts you in control of what happens to your assets when you are either no longer able to manage them yourself, or you are no longer alive. This is my contribution to society and to our community. Book your complementary consultation today to discuss your legacy goals. See our Bookings page to book your consultation today.

[i] Alisha Haridasani Gupta & Christine Hauser, New Breonna Taylor Law Will Ban No-Knock Warrants in Louisville, KY, N.Y. Times ( Jun. 12, 2020), https://nytimes.com/2020/06/12/us/breonna-taylor-law-passed.html. (Breonna’s law passed unanimously by city council on June 11, 2020. Essentially bans no-knock warrants, requires police to have operating body cameras on when conducting a search, and requires cameras to be on and operational 5 mins prior to search and 5 mins after search. There is also federal legislation in consideration that would make this relevant to federal agents as well)

[ii] Grace Hauck & Niquel Terry Ellis, Rayshard Brooks death: Atlanta police officer fired; police chief steps down, USA Today (Jun. 13, 2020), https://usatoday.com/story/news/nation/2020/06/13/atlanta-shooting-police-officer-kills-black-man-wendys-drive-thru/3183209001/. (Apparently Mr. Brooks was at the drive-thru of the Wendy’s and had fallen asleep. Police were called to check his sobriety, and he was not sober. There was a tussle between the officers and Mr. Brooks and somehow Mr. Brooks ended up with one of the officer’s tasers. He was running away when police officers shot him in the back. The officer who shot him has been fired and the other one placed on administrative duty. The Wendy’s was burned down by protesters the next day)  

[iii] History.com Editors, Montgomery Bus Boycott, https://history.com/topics/black-history/montgomery-bus-boycott (last updated Feb. 10, 2020). (A civil rights protest sparked by the arrest of Rosa Parks for her refusal to give up her seat to a white passenger; during which African Americans refused to ride city buses in Montgomery, Alabama, to protest segregated seating. Took place from December 5, 1955 to December 20, 1956, and is regarded as the first large-scale U.S. demonstration against segregation. African Americans were 75% of the bus ridership at the time. That collective power, organization, and resistance opened up doors for African American bus drivers, open seating on buses, and better treatment of the very passengers who kept the bus companies in business)

[iv] Josie Pickens, Black Wall Street and the Destruction of an Institution, https://www.ebony.com/black-history/destruction-of-black-wall-street/ (last visited on Jun. 15, 2020). (Black Wall Street was in Greenwood, Oklahoma. It was 40 square blocks of Black businesses, Black home ownership and self-sufficiency that was the envy of many surrounding areas. There were over 150 Black-owned business including banks, hospitals, schools, churches all destroyed in a matter of 2 short days, May 31-June 1, 1921. The historical record documents a murderous assault on Black lives and property. Over 300 African Americans were slaughtered as they watched their dreams get looted and burned to the ground. The attack was perpetuated by the government including the National Guard and other deputized Whites, and left over 9,000 African Americans homeless)

[v] Imani Moise, African Americans Underserved by U.S. banks: study, Reuters, Aug. 13, 2019, https://www.reuters.com/article/us-usa-bamls-race/african-americans-underserved-by-u-s-banks-study-idUSKCN1V3081. (Many Blacks lack access to mainstream financial services and depend on more expensive financial services. Black families are being underserved and overcharged by institutions that can provide the best channels for saving. Banks in Black neighborhoods typically require higher account balances to avoid service fees)

[vi] Blackout an Economic Revolution, U.S. Map of Black Banks & Credit Unions, https://blackoutcoalition.org/black-u-s-banks/ (last visited Jun. 15, 2020). (A great resource for finding Black banks, hotels and overall Black economic empowerment)

[vii] BOTWC Staff, Largest Online Marketplace for Black Owned Businesses Just Launched Fulfillment Operations, Because of Them We Can, https://www.becauseofthemwecan.com/blogs/news/the-largest-online-marketplace-for-black-oned-businesses-just-launched-a-distribution-operation. (last visited Jun. 15, 2020)  

Something Has Got to Change (Race Relations in America)

Protesting in DC

 “Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly, affects all indirectly.” -Martin Luther King, Jr, Letter from the Birmingham jail 1963

“Be peaceful, be courteous, obey the law, respect everyone; but if someone puts his hands on you, send them to the cemetery.” – Malcolm X

For the past few days, my youngest daughter and I have been marching with the Black Lives Matter protests in DC and VA. When we marched in DC, the police and military presence was everywhere. You would have thought that there was a full-blown war going on and an enemy had invaded their territory. The actual protesters were in fact very peaceful (at least during the times when we were there). At one point we sat down and just listened to a few people speak. People of all races were represented. Some were passionate, outraged, saddened, and overall fed up with the police killing of black and brown men and women. We chanted “Say his name: George Floyd,” “Say her name: Breonna Taylor,” “No justice, no peace,” “No racist police,” “Hands up, don’t shoot!” “What do we want? Justice! When do we want it? Now!” and a few other powerful call and respond phrases. It was an exhilarating experience. So many emotions ran through us. We wanted to do something. We wanted to have an impact. We wanted to be supportive of a cause that touched so close to home.

You see I am the mother of two black daughters and a black son: the daughter of black parents. I am the aunt to black nieces and nephews. I am engaged to a black man. We are all aware that at any given moment any one of us could be the target of a system that was never designed to protect or serve us. My nephews, fiancé and some of my cousins have been harassed by the police on many occasions and have at times been taken into police custody. Whenever my son leaves the house with his friends, I worry if he will return home in one piece. I have had to coach him about how to interact if he is ever approached by the police. It is scary to think that at any given moment because of the color of their skin, your child could be the next victim of police brutality.

During one of our marches, we stopped at the Martin Luther King, Jr. monument for what they called a “Die in.” We knelt for 8 minutes 46 seconds: the amount of time that it took Officer Chauvin to murder George Floyd with a vicious knee to the neck as he pleaded for his life. During that time, the names of many black and brown men and women were called as we honored them. Some were high profile cases of which I was familiar. Yet many were names that I had never heard. Name after name was called: Korryn Gaines, Atatiana Jefferson, Michael Brown, Jr., Eric Gardner, Philando Castile, Freddie Grey, Rodney King, Sandra Bland, Tamir Rice, Trayvon Martin, Ahmaud Arbery, George Floyd, Breonna Taylor and the list goes on and on. All murdered in cold blood by a systemic disease of white supremacy and the stench of racial injustice that permeates American society. Hearing all of those names did something to me. It made me wonder how many names we still did not know. It made me think about the pain that their families surely feel and how each one of those deaths were preventable. I know if the people named during that 8 minutes 46 seconds were white; most of them would have lived to tell the story. That makes me feel a lot of different ways; sad, angry, frustrated, outraged, unsafe, leery, and most of all like something has GOT to change!

Black people have an extremely complicated history in America. It is like America wants the benefits of black people’s time, talent, resources, but never wants to fully acknowledge our humanity. When the Constitution was written, it was never meant to benefit anyone but privileged white men. Everything and everyone around them were at their disposal, for their use, their pleasure, or whatever they saw fit.  The blacks who were for the most part all enslaved (although there were some free blacks), were considered 3/5th’s of a person.[i]  It was not until the Reconstruction Era of the 1860’s and 70’s that three key provisions of the Constitution were ratified that legislatively freed the slaves (13th Amendment), provided them with citizenship and Due Process under the law (14th Amendment), and gave black men the ability to vote (15th Amendment).[ii]  This was a time of unrest and upheaval not unlike what we are seeing now. It took years of fighting and constant pressure for things to change.

Over the years, many more fights were fought to continue the work that the heroes and sheroes of the Reconstruction Era started. Women fought for the right to vote and finally won.[iii]  African Americans continued to be subjected to inhumane treatment, Jim Crow laws, and discrimination in every area of our lives. Because of heroes and sheroes of various Civil Rights movements over time, and the marching and speaking out of a hurting people, laws were passed opening up doors for African Americans that had previously been shut tight.[iv] This came with a high price of innocent blood shed (i.e., Bloody Sunday), persistent black leadership soliciting the powers that be, and an organized people unwilling to give up until they accomplished their goal of change (i.e., Bus Boycotts).

I am so excited to see people fired up again! I love the energy of people taking to the streets and demanding justice for the many unaccounted-for lives that have been snatched away before their time. I am enjoying seeing the young, old, black, white, LGBTQ, Latinx, and so many other supporters out marching, speaking out, and pushing legislators to write laws that will effectively change the protocol for police conduct.[v] If we continue with this momentum, we will make this world a better place for our children and children’s children. We are at a tipping point in history. I encourage everyone with a voice to speak out; everyone with working and willing feet to march and protest; everyone living in the US to vote because our very lives depend on it! Something MUST change and that change starts with our collective voices being heard and respected! It is going to take time and persistence, but together we can do this!

My firm and I are available for any questions or concerns raina@reflectionslifeplanning.com.  We vow to take a stand against injustice and continue fighting for the equality we all deserve as human beings regardless of skin color. Be safe and continue to fight until things change!     

[i] See U.S. CONST. art. I, § 2, cl. 3.

[ii] See id. amend. XIII, § 1, amend. XIV, § 1, amend. XV, § 1.

[iii] See id. amend. XIX.

[iv] See Civil Rights Act of 1964 (while there were many other important Civil Rights Acts passed over the years, this one provided many of the rights that African Americans now enjoy- outlawed discrimination based on race, color, religion, sex, or national origin. Also prohibited discrimination in voter registration requirements, and racial segregation in schools, employment, and public accommodations). 42 U.S.C. § 2000e (1964).

[v] See Breonna’s Law (calling for the end of no-knock warrants and other police reform- going to full Metro Council in Louisville for vote on June 11th).

When a Member of your Blended Family has Special Needs

According to The National Survey of Children with Special Healthcare Needs, 12.8% of children under age 18 in the United States, or about 9.4 million children are estimated to have special healthcare needs. These special healthcare needs span from very severe- totally disabled to more mild needs. Blending families comes with its own challenges; biological children, stepchildren, exes, in-laws, ex-in-laws, visitation, child support, alimony and so much more. A family member with special healthcare needs brings another element to the blended family.

Take Abagail and Ian a middle-aged recently remarried couple trying to work through their differences. Abagail is 47 and has twin daughters (Mya and Kate) who are 23 years old from her first marriage. The second twin, Kate, was born autistic with a rare genetic disorder causing a serious bone disease making her bones extremely brittle. In fact, Kate is unable to walk, talk or care for herself in any manner. Everyday Abagail must bathe, dress and feed Kate. Kate also has various doctor’s appointments at least 2-3 times per month as well as therapy twice per week, a special diet, and a significant amount of prescription medication. Abagail has health insurance, but she still pays hundreds of thousands of dollars in copays and out of pocket expenses for Kate’s medical care. She especially pays a significant portion of the cost for Kate’s many surgeries. Abagail is aware that Kate will never reach independence and will need extremely expensive medical care for the rest of her life. Her daughter Mya on the other hand, is well spoken, a recent college graduate, and had just gotten a new job and apartment. Ian was 44 and had one son (Ian Jr) who was 17 years old from his first wife. Neither Ian nor his son had experience with anyone requiring special healthcare needs. He was baffled by the amount of time and energy that it took out of Abagail to care for Kate’s needs. He was also incredibly surprised when he learned about how much it cost Abagail each month for Kate’s care.

Abagail and Ian had never really discussed what their plans were in the event of either of their death or disability. They had not even given much thought to what would happen if Abagail were the first to die. Who would be willing to take care of Kate for the rest of her life? Being the custodial parent, Abagail had Kate full-time. Abagail’s ex-husband shied away from dealing with the reality of Kate’s ongoing needs. They too had never discussed a plan for Kate if Abagail was unable to care for her due to death or disability. Ian was afraid to approach the subject because Abagail was extremely sensitive about Kate due to her condition. Ian also knew that if something were to happen to Abagail, he needed to know what to do about Kate. Ian finally mustered up the courage to have the discussion with Abagail because he was genuinely concerned. Some of the things that Abagail and Ian need to discuss concerning Kate’s special healthcare needs:

  1. What is the plan for Kate’s long-term healthcare needs?
    • Will they hire help?
    • What part will her father play?
    • What if Abagail is unavailable due to her own disability?
    • What is the plan for financing pricey surgeries?
  2. What is the plan for Kate’s care upon Abagail’s death?
    • Is there a Special Needs Trust in place to handle any assets that Kate will inherit?
      • Since Kate will never gain independence or the mental capacity required to contract, she will be unable to inherit anything in her individual name.
      • It is imperative that her caretaker(s) have a way to finance her healthcare when one or both of her parents die.
      • It is also imperative to carefully select a Trustee who understands the seriousness of prudent money management and the gravity of the undertaking.
      • If there is no trust in place, Kate will always need a Power of Attorney to handle her financial affairs.
    • Are there Medical Directives in place naming a Healthcare Power of Attorney?
      • This person would need to understand the complexities of Kate’s medical history and how Abagail has historically handled healthcare decisions.
      • It can be a family member, a trusted friend, or someone else whom Abagail trusts to make the right decisions concerning Kate’s health.
  3. How will Ian and Abagail incorporate the needs of their other children with the demands of Kate’s care?
    • Abagail still has Mya to think about as she plans her estate. Even though she is aware that Kate will have ongoing medical needs for the rest of her life, she does not want to leave Mya out of the equation.
    • What if Abagail and Ian decide to have a child/children together? How will a new baby/babies play into the family? Kate’s special needs is the reason why Abagail and her former husband decided not to have more children.
    • How will Abagail have the time and energy to bond with her new stepson Ian Jr?
    • What role will Ian play in Kate’s care and how will he bond with both she and Mya?

As you can see, Ian and Abagail have a lot to think about as they discuss the extremely sensitive topic of having a special needs family member. Many blended families gloss over the real financial and legal impact of their decision to blend. It feels easier to avoid the subject or think that love is going to make all of the real issues go away. This could not be further from the truth. The above list is just a thought starter for some of the things that any couple with a special needs family member should discuss. Success will require the couple to continuously communicate openly and honestly so that the silent issues do not wear away at their new marriage.

If you or someone you know is contemplating entering a blended family situation and want to conduct a comprehensive review of all of the legal and financial considerations that a blended family needs to think through, do not hesitate to contact me at 703-630-9170 or raina@reflectionslifeplanning.com.  The consultation is good for dating and engaged couples planning for marriage or cohabitation. It can also help married or cohabiting couples who want to take a step back and evaluate the legal and financial impact of their blended family situation.

Why You Need a Blending Agreement for Your Blended Family

Blended or step-families come in all different shapes and sizes. The way that these unique families handle finances comes in just as many varieties. Some families go for the more traditional route of merging all financial matters into joint accounts and making all financial decisions together. Other families choose to keep everything separate and operate individually in financial matters. Other families chose a hybrid method of maintaining some accounts separately and using a joint account for shared expenses. Either way money is a large part of any family’s life and should be handled with care. It takes a great deal of communication and transparency to keep financial matters in check and to keep money from ruining your family.

Take Eli and Greg. Eli is significantly younger than Greg. Eli is a highly compensated physician whose income is at least double that of Greg’s salary as a welder. Eli does not have any children. He has focused all of his time and attention building his career and traveling. Greg on the other hand, is a divorcee with two daughters who are close in age to Eli. Greg and Eli have decided to get married and move in together and are trying to decide on how they will handle their finances.

In addition to how they will handle their finances, Greg and Eli have a lot to think about. For starters, how will Greg’s children view Eli given that he is closer to their age than their father’s age? Greg’s two daughters are 19 and 24. Eli is 29. It is going to be difficult for Greg’s daughters to look at Eli as a step-parent even though once the marriage takes place that is what he will technically be to them. They had a hard enough time accepting the fact that Greg left their mother because of his newly discovered sexual identity. Welcoming Eli into their already established lives was not going to be easy. Where will Greg and Eli live? If Greg moves to Eli’s bachelor pad he will have to put his two daughters out and sell his family home. If Eli moves to Greg’s family home with he and his two adult daughters, he will have to contend with some serious boundary issues. Even if Greg and Eli decide to purchase a home together, they will need to have a serious discussion about the long-term plans of his adult daughters and how Eli is to interact with them.

Greg and Eli will need to figure out how they plan on handling financial and estate matters. Greg has a lot more responsibilities than Eli. Greg will likely have certain things that he wants to pass on to his daughters in the event of his death. Eli has more income than Greg, but will likely never have biological children of his own. Since Greg is significantly older, the likelihood that he will predecease Eli is very high. What will Eli’s relationship be with Greg’s daughters when Greg is no longer alive? Is Eli expected to leave anything to Greg’s daughters if Greg was to leave everything to Eli? All of these issues should be ironed out and discussed with full transparency before Eli and Greg take the leap.

Eli and Greg can outline their commitment to each other and how they will handle their financial affairs in a Blending Agreement. It is similar to a prenuptial agreement but looks to unify a blended family on all fronts. The Blending Agreement should outline a number of extremely important details that can be easily overlooked in a blended family:

  1. How day to day financial matters will be handled (paying bills, saving/investing for the future, allowances- if any, large purchases, spending limits requiring joint decisions)
  2. How medical issues including possible incapacitation should be handled (outlined in Advanced Medical Directives)
  3. How children should be handled (will vary depending on involvement of exes, age of children, court orders, and other unique factors)
  4. How household chores/responsibilities will be handled
  5. Any special needs in the family (things like aging parents that will need to be cared for, medical conditions of either spouse or their children)
  6. How any outstanding debts will be handled (discuss credit rating, credit cards, loans, child support, alimony, any other financial obligations)
  7. List out all of the assets (everything owned by both parties, bank/brokerage accounts, real estate, trust accounts, personal belongings, vehicles, collections)
  8. Discuss how each person’s estate is to be handled in the event of death of one or both spouses, be sure to create estate documents for memorialization (can use a Will or Trust instrument depending on estate goals, should update any out-of-date documents)
  9. Discuss how any long-term care needs will be handled and financed (using personal accounts, other assets, long-term care insurance)
  10. Discuss life insurance policies and beneficiaries on all accounts (look at beneficiaries on retirement accounts, bank and brokerage accounts, life insurance policies and the like)

As you can see, a Blending Agreement gives Eli and Greg total transparency into each other’s financial lives and opens the door for discussion about their respective families. It is a flexible agreement that can and will change over time. Children move out, relationships evolve, other children or grandchildren may be born and a myriad of other things may happen in the course of a couple’s life together. When the going gets tough the couple can always look back at their Blending Agreement and remember how they said they were going to handle said situation. There is nothing wrong with referring to the Blending Agreement as frequently as necessary and using it as a guiding tool for family unity and understanding.

A Blending Agreement can be used by an already married or cohabiting couple. It is best used by a couple contemplating marriage or cohabitation and trying to get a thorough assessment of what life with their future spouse or partner will look like. It is meant to bring about a sense of harmony and unification over matters that left unspoken will creep up and tear away at the foundation of your family. If you or someone you know would like to assess your need for a Blending Agreement to give structure and togetherness to your blended family, reach out to me at raina@reflectionslifeplanning.com. I am a licensed attorney and financial advisor who specializes in serving blended families with adult children. I want to help you to think about these issues and many more things impacting the financial and estate matters of your blended family.

Estate Planning During an Emergency

Estate planning is generally a deliberate and well thought out process that is carried out throughout the life of the person doing the planning. You may think about who gets your prized art collection in the event of their death, who is going to make medical decisions in the event of your incapacitation, and who is ultimately going to take care of your financial affairs. But what happens when death or incapacitation hits before you have had time to think about these things? What do you do when you have not done any planning and an emergency situation arises?

If disaster strikes and you are unprepared, here are some quick things that you can do to establish a make shift estate plan that will help to settle your affairs in the event of an untimely death (this only works if you have legal capacity, mental capacity, and testamentary intent):

  1. Many states allow handwritten wills called holographic wills. In the event of a holographic will, you would write your final wishes in your own handwriting and sign and date the document. Check your state to make sure that it recognizes holographic wills and see if there are any specific nuances that you need to follow in order for it to be valid. If your state allows holographic wills, there are a few general requirements:
    1. It must be written entirely in the testator’s handwriting, or the material provisions must be in the testator’s handwriting (depending on the state)
    2. It must indicate the testator’s intent to make a will
    3. It must clearly describe the property, and identify the beneficiaries to whom the property is to be distributed
    4. It must be signed by the testator (some states also require that it be dated)
  2. Another option if you have time and the ability to get a notary, is to purchase a will using an online program. Just make sure that it is specific to your state. www.mamabearlegal.com is a great resource where you can get a will that is standardized to your state for a low price.
  3. An even better option again if you have the time and financial resources, is to hire a lawyer licensed in your state to draft and execute a will and other directives on your behalf.
  4. Appoint someone whom you really trust to serve as your Power of Attorney. This person can act on your behalf and take care of your financial affairs only while you are alive. They can pay your bills, make buys and sells in your investment accounts, and handle your overall financial management.
  5. If you are able, it is good to add beneficiaries to any accounts where you are the sole owner. That way if you pass away, the funds can go directly to your beneficiaries without going through the probate court.
  6. Another option if you are able, is to add someone whom you really trust as a joint account holder with rights of survivorship. If you pass away, those funds would go directly to the joint account holder again without going through the probate court. Many married couples use this method to transfer assets between themselves at death. They then add their children as either beneficiaries or joint account holders when one of the spouses dies.
  7. Appoint someone as your Healthcare Power of Attorney and make your resuscitation wishes known. If you do not want life-saving treatment or to be kept alive on a ventilator after a certain period of time, be sure to write those things out.

It is important to take care of anything from the list above while the person is still alive. Once a person has passed on, or has become mentally incompetent the list of options shrinks significantly. If the person passes away suddenly and has not done any planning, here is what to expect:

  1. All of the accounts that are in the deceased’s individual name with no joint account holder or named beneficiaries will be frozen. Those accounts must go through the probate court in order to determine the final disposition. If there was a joint account holder on the account, they can continue using the account, but just need to produce a death certificate to the financial institution to remove the deceased account holder’s name. If there were beneficiaries named on the account, they will need to contact the financial institution, produce a death certificate and their identification to claim the assets. Check with the financial institution to make sure they do not have any other forms or requirements to claim assets.
  2. If the deceased had a will, the will would have to be submitted to the probate court in order to determine how their affairs will be finalized. The will should have a named Executor who will carry out the deceased’s wishes and insure that everything is handled properly.
  3. If the deceased had a trust, it does not have to go through the probate court. The instructions of the trust can be carried out per the deceased’s wishes.
  4. If the deceased had no will or trust, a probate case would have to be filed under the laws of intestacy. This is where the court basically creates a will for the deceased’s assets based on the statutory laws of the state. This is the least ideal scenario since the deceased will have no say in how their assets are distributed.  

Dying can be complicated and extremely expensive. In addition to the short list above, there is a barrage of other things that will need to be handled. Funeral arrangements, family disagreements, long lost relatives showing up, and protecting any of the deceased’s real and person property from theft or mishandling to name a few. If you or someone you love need help making an estate plan, reach out with your questions to raina@reflectionslifeplanning.com.

Share Your COVID-19 Story

Good and bad has come from this global pandemic. This week I want to share my good and bad and hear from you about your good and bad. Yes, I am counting down the days to when this thing will be over. However, I understand that there is no quick fix and it will get worse before it gets better.

I have been listening to stories from people all over the world about how their lives have changed. I have heard about people losing loved ones, taking more time with their families, and everything in between. What has happened in your lives as a result of COVID-19?

I will start with the good things that have taken place. Since working from home for the past month, I have a lot more time with my family. We have cooked out on the grill, assembled tons of puzzles, watched movies, and done a few small projects around the house. I have also saved lots of time since I no longer have a 2+ hour commute into D.C. for work. My commute is now downstairs into my home office, so that has been really nice! I have also saved lots of money on gas, parking, the inevitable tickets that I sometimes get, eating out and other activities that I normally do (can’t wait to be able to get back to them though). Additionally, I do not have to get up as early to workout. I can get my workout in at anytime throughout the day without having to worry about being late for work. I also feel very appreciative of everything. Sometimes when we are relaxed and comfortable we don’t realize just how good we have it.

Unfortunately, we lost one of my uncles on my dad’s side to the virus. It is really bad in Michigan where I am originally from and my uncle was diabetic. The hardest part is given the nature of the virus, we are unable to give him a proper burial or say our final goodbyes. I also heard that one of my high school classmates succumbed to the virus a few days ago. Although financial services are considered essential, my job has been forced to close several locations due to infections. This has made it difficult to get a sense of normalcy despite what is going on. The stores in my area are having a difficult time keeping items like toilet tissue, milk, eggs, water and other staples stocked. They have literally been forced to limit the amount of those types of items that people can purchase at one time. The death and destruction of this disease has impacted the world like nothing I have ever seen in my lifetime.

This creates a shift in how we do things forever! Some of the jobs that we can now do from home will no longer require brick and mortar. Some of the things that we are learning to live without will not be coming back. Some of the industries and jobs will forever morph into something different than what we knew pre-virus. Feel free to share your stories. How has your life changed? What things have you learned about yourselves, about others, about what is important in life? How are you coping with the changes? What support do you need to get through this?

Join my Facebook group DMV Happy Blended Family Network for more content related to financial and estate planning for blended families, and overall blended family support and information. https://www.facebook.com/groups/dmvhappyblendedfamilynetwork/

Leave your feedback if there are other topics that you would like to touch upon. Like, share, comment.

Finding Liquidity During COVID-19 Emergency

The past few weeks have been a whirlwind of information on what is really going on with the spread of COVID-19. Continent to continent, state to state, person to person, we are learning more about this highly contagious and deadly virus every single day. More recently the federal government has approved a $2 Trillion stimulus package to help ease the economic backlash of social distancing and the resulting shut down of so many businesses. In a time when things are tight, many people are looking for ways to decrease their risks and increase their liquidity.

Here are a few tips to help you find that liquid cash and minimize your risks while you maintain the health and wellbeing of yourself and your family:

  1. If you need to tap into your individual retirement accounts for cash, you are able to access up to $100,000 without paying the 10% penalty if you are under age 59 ½. You also do not have to worry about paying taxes on the amount that you take out right away. The stimulus package (CARES Act) gives you up to 3 years to either pay the funds back or pay the taxes on the withdrawal.
  2. If you have a 401(k) account with your current employer and are still employed, you can take a loan from the account of up to $100,000 or 100% of the account value. Under normal circumstances, you are only allowed to take up to $50,000 or 50% of the account value.
  3. If you have a small business, there is a chance that you are eligible to take out a small business loan that you may not have to pay back. As long as the funds are used for things like rent, mortgage, utilities and payroll to keep the business afloat through June 30th, the loan does not have to be repaid. Check with your local bank to apply for the program.
  4. If you own a home and have equity, you may be able to take out a home equity line of credit. Another option if you own a home and your interest rate is on the high side, you may want to check rates and see if refinancing makes sense for you.
  5. It is a good idea to contact all of your creditors and ask what they are doing for people who have been impacted by the recent events. Many creditors are deferring payments, allowing waivers of late fees, and finding ways to work with you during this time.
  6. If you have lost your job and need to file for unemployment, the CARES Act allots an additional $600/wk for the next four months. The $600/wk is above and beyond the regular unemployment benefits. Also unemployment usually lasts only 26 weeks. As part of the response, unemployment has instead been extended to 39 weeks.
  7. You may be eligible for a one-time stimulus payment of $1200 plus $500 per child under age 16. Eligibility depends on your tax filing status and income. If you earned an adjusted gross income of $75,000/year or less, you are most likely eligible for the full payment. For a married couple, that amount is $2400 as long as the income is $150,000 or less.
  8. If you have a non-retirement investment account, you may be eligible to take out a securities based line of credit. A securities based line of credit allows you to borrow against the value of your securities without having to actually sell them. The rates are usually based on LIBOR plus a spread and are significantly lower than using a credit card.
  9. It may be time to revisit your risk profile and take an assessment of your goals. However, this is not the time to make rash decisions and sell based on fear. Carefully consider your short, mid-range, and long-term goals and decide if you are in the right types of investments to meet those goals. The more you focus on your goals, the less you will worry about the day to day movements in the market.
  10. Expect a significant amount of volatility in the months to come while the world adjusts to a new normal and the economy begins to reopen.

Above all stay safe and healthy and try to remain as calm as possible. Take seriously the stay at home orders and social distancing when out. This will eventually pass, but not without leaving its historical mark.

Join my Facebook group DMV Happy Blended Family Network for more content related to financial and estate planning for blended families, and overall blended family support and information. https://www.facebook.com/groups/dmvhappyblendedfamilynetwork/

Leave your feedback if there are other topics that you would like to touch upon. Like, share, comment.