Check out the latest edition of our newsletter!
March 2025
603-894-4141 | 978-969-0331 | LegacyCareLaw.com
Early Planning, Long-Term Peace How Young Adults Can Protect Their Families and Futures
Are the young adults in your life prepared with a proper estate plan? Since many fall for the false belief that estate planning is only for older generations, I want to discuss why it’s essential for people in their 20s and 30s to consider planning and what risks they face by remaining unprepared. Many young adults, particularly those just starting their careers or families, do not think estate planning is necessary. It’s common to associate estate planning with older age or considerable wealth. However, life’s unpredictability doesn’t discriminate by age. Young adults face specific risks and have unique considerations that make having an estate plan not just wise but essential. One critical component is a young person’s health care directive. This document is invaluable if a young adult becomes incapacitated due to an accident or illness. Without a health care directive, parents may not even have the legal authority to make medical decisions for their adult children. Moreover, HIPAA laws could prevent them from even receiving information about their child’s medical condition. This scenario is a parent’s nightmare — being kept in the dark during a critical moment due to a lack of proper legal documents. For young families, especially those in their 30s with small children, the thought of planning for guardianship is daunting but necessary. No one wants to think about the possibility of passing on and leaving young children behind. But should anything happen to the parents, a clear and legally binding plan must be in place to ensure trusted individuals care for the children and that any inherited assets are appropriately managed. A simple will might name guardians, but it often isn’t enough to avoid lengthy and stressful court proceedings. Additionally, today’s younger generation lives a significant portion of their lives online, creating a digital footprint older generations don’t have. Digital assets, from social media accounts to digital banking, require careful management and protection. An estate plan that includes digital assets is crucial for ensuring online profiles are transferred or closed according to the deceased’s wishes and that digital wealth is distributed appropriately.
planning. It’s not just about having a will, but covering all aspects of one’s life, from physical and medical to digital and beyond.
The risks of neglecting to create an estate plan can be significant. Without one, young adults leave their health decisions in the hands of strangers, their assets subject to state laws, the guardianship of their children undecided, and their digital legacy potentially in limbo. I encourage you to share this message with your younger family members or friends. Help them understand the importance of these decisions and how they can protect themselves and their futures. If you or they need legal guidance, my firm is here to provide the necessary support and information to create a comprehensive estate plan tailored to their needs. Remember, estate planning is a profound act of care — not just for oneself but for one’s family and future. It’s never too early to start, and it’s certainly a conversation worth having at any stage in life.
Starting this conversation with clients about their children or young friends often opens their eyes to the necessity of early estate
LegacyCareLaw.com 1
Published by Newsletter Pro • www.newsletterpro.com
Crack the Code Benefits and Drawbacks of the Latest College Aid Forms
Applying for college financial aid has been a moving target recently amid changes in federal rules. One new loophole is good news for families, however. For the first time, grandparents can set aside money in tax-sheltered accounts to help pay a grandchild’s college expenses without jeopardizing the student’s eligibility for other financial aid.
In another change, the latest FAFSA substitutes a new measure, the Student Aid Index (SAI), for the Expected Family Contribution measure used in the past. The SAI ranges from -1500 to 999999, and the lower it is, the greater the likelihood a student will get need-based financial aid. States’ 529 plans, named for Section 529 of the Internal Revenue Code, function like a kind of 401(k) account for education by deferring taxes on investment gains on savings for designated educational purposes. States began to develop these plans in the 1980s to encourage families to save for college, and all states now sponsor some version of a 529 plan. Other changes include expanding the number and potential size of Pell Grants. The maximum Pell Grant will rise to $8,145 in the 2025–2026 academic year from $7,395 in 2024–2025. While the SAI is calculated based on a student’s family size, income, and assets, eligibility for Pell Grants also considers a family’s financial standing according to federal poverty guidelines. In other changes, the revised FAFSA relies on federal tax information provided by the IRS rather than answers provided by applicants. It also asks fewer than 50 questions, compared with 108 in the previous form. While many people labor over the form’s detailed questions, the most common mistake is not filling out the FAFSA at all. This omission excludes students from eligibility for numerous subsidized loans and grants, scholarships, and other aid from the college or university they attend. Many students wrongly assume they won’t be eligible for aid because they or their parents make too much money or their grades aren’t high enough. Plenty of circumstances can qualify applicants for grants and awards, from being the first in their family to attend college to being in the military, being unemployed, or planning to major in a specific in-demand subject. With numerous sources of financial aid in play, the potential rewards of completing the FAFSA are well worth the time invested!
The benefits could be significant for families planning, saving, and working together toward college-funding goals.
The primary tool to qualify for federal aid and other sources of help is the Free Application for Federal Student Aid (FAFSA). The latest version of FAFSA does not require students to report distributions from grandparent-owned 529 college savings plans. In the past, those distributions could reduce a student’s financial aid by half of a grandparent’s contribution. Family members, including grandparents, are playing a growing role in covering soaring college costs. Undergraduate students cannot borrow more than $5,500–$12,500 a year in federal subsidized and unsubsidized loans, depending on their school year and whether they rely on their families. This nearly always falls short of the average annual public university tuition of $11,000 for in-state students, $24,500 for out-of-state students, and $43,500 for private college students. Parents are shouldering an increasing share; 11% take out federal parent PLUS education loans, borrowing an average of $40,000 per parent as of 2020. Other changes in the FAFSA form have subtler implications for families. The government no longer considers the number of students one family has in college simultaneously to determine eligibility. This is bad news for families with multiple children who want to attend college at the same time.
“The latest version of FAFSA does not require students to report distributions from grandparent-owned 529 college savings plans.”
603-894-4141 | 978-969-0331 2
Published by Newsletter Pro • www.newsletterpro.com
Protect Your Assets from Nursing Home Costs. Avoid Probate Fees and Frustration. Minimize Death Taxes.
Live Webinar Tuesday, April 8th 1 PM EST ONLINE
LEARN ABOUT ESTATE PLANNING FROM OUR ATTORNEYS Call us or visit our website to sign up: 603-894-4141 or 978-969-0331 www.legacycarelaw.com
Wednesday, April 16 TWO SESSIONS: 1 PM or 6 PM Beverly, MA In-Person Seminars
OFFICES LOCATIONS: SALEM, NH
NASHUA, NH
BEVERLY, MA
WOBURN, MA
NORTH ANDOVER, MA
All Paws on Deck Keeping Pets Safe in Emergencies
When a disaster strikes, it’s not just your home and immediate family you need to protect; your furry family members also need you to keep them safe. By preparing for the unexpected and ensuring you have the right supplies, lines of communication, and arrangements, you can help reduce the stress and uncertainty for you and your furry companions. Get ready to be all paws on deck with these tips to keep your pets safe during emergencies. Be Purr-pared With a Plan Make sure you include your pet in your household’s overall emergency plan. You will avoid stressful scrambling at the last minute when a disaster occurs. If you need to evacuate, account for all pets so they don’t get hurt or lost in the chaos. Not all public shelters and hotels allow animals to stay, so determine a safe place to take them. It’s also important to assign a friend, neighbor, or family member to care for your pets if you cannot. If you have not microchipped your pet, now is a great time. Shelters can scan microchips to determine a lost animal’s home and owner’s contact information. Pack for Your Pets Create an emergency kit for your pets that includes supplies they need to survive a disaster. You should have a few days’ supply of food, water, and any medications your pet needs. Ensure you have a backup leash and collar and copies of your pet’s registration.
Include grooming items and sanitation tools like pet litter and paper towels. Items like favorite toys or your pet’s blanket can comfort them in stressful situations like an evacuation. Travel-Ready Tails Make sure you are ready to transport your pet in a travel carrier quickly. Place their carrier open in an area your pet is comfortable with, like a favorite napping spot. You can add a familiar blanket and toy inside to reduce their stress and use treats to encourage them to go inside. Make a mental note of your pet’s behavior during stressful times so you know where their go-to hiding spots are.
LegacyCareLaw.com 3
Published by Newsletter Pro • www.newsletterpro.com
PRST STD US POSTAGE PAID BOISE, ID PERMIT 411
9 Red Roof Lane, Salem, NH 03079 603-894-4141 978-969-0331 LegacyCareLaw.com
INSIDE THIS ISSUE
1 2
Are Your Children Prepared for Life’s Turns?
Loopholes and Pitfalls in College Financial Aid Rules
3
Not Your Mom’s Corned Beef and Cabbage
Prep Your Pets for Disasters
4
How the DOL’s Final Rule Protects Retirement Investors
A NEW ERA FOR ERISA The Final Rule Transforms What It Means to Be a Fiduciary
For more than 14 years, the U.S. Department of Labor has been trying to determine a new definition of a “fiduciary” under the Employee Retirement Income Security Act (ERISA). A fiduciary provides investment advice for a fee to employee benefit plans. Under ERISA, someone is a fiduciary if they have control over managing
or using a plan’s assets, provide investment advice for a fee, and have responsibility for managing the plan. Since 1975, these discussions were only considered “investment advice” if they adhered to a five-part test. However, this past September, the Department of Labor released new regulations called the Final Rule that redefines what it means to be an investment advice fiduciary. With this recent change, the five-part test goes out the window. The Final Rule expands the definition of who can be considered a fiduciary. Someone is a fiduciary if they regularly provide investment recommendations and advice to retirement investors for a fee. That advice must be based on the investor’s needs and reflect expert judgment that serves the investor’s best interests. They must also state that they are acting as a fiduciary when giving advice;
however, if you’ve previously received one- time advice, that could now be considered fiduciary advice. That’s a lot of information to swallow, and by now, you’re probably wondering how this will affect the average person. In most cases, these changes will only affect those acting as fiduciary advisors and retirement investors, including participants, beneficiaries, IR owners (Ingersoll Rand Inc.), and anyone else involved with an ERISA plan. Through the Final Rule, you should receive better advice that puts your interests first, providing more transparency about recommendations and any fees involved. It should also create greater accountability for advisers, brokers, insurance agents, and anyone else acting as a fiduciary. All in all, this is a great change for those who interact with fiduciaries. You can rest assured knowing the advice you receive will benefit you and your investments.
4
603-894-4141 | 978-969-0331
Published by Newsletter Pro • www.newsletterpro.com
Page 1 Page 2 Page 3 Page 4Made with FlippingBook Ebook Creator