Sarah Stewart Legal Group, PLLC

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Tom Petty’s Lessons on End of Life Care

Image from a Journal of Musical Things

By Sarah Stewart Legal Group

On October 2, 2017, music fans around the world sobbed when legend Tom Petty died.  Fans received the admittedly surprising news that Petty suffered a heart attack and was quickly taken off life support. Petty’s family made this decision so quickly because they followed a do-not-resuscitate order put in place by the musician.

Much like Petty, all of us can benefit from a plan for our end-of-life care.  A well-thought-out plan can save your family money and heartache.

According to a 2010 study, Medical expenses in the last year of life average about $11, 618.  With inflation, we can estimate those expenses would be closer to $18,000 today. For families requiring nursing home or assisted living facility care, this number can be much higher because monthly averages for these facilities run from $4,000 – $6,000 per month.

Advance Directive for Healthcare

One important document to help you make your end-of-life care plans is an Advance Directive for Healthcare.  Only 26. 3% of adults admit to having this undeniably important document.

An Advance Directive only goes into effect when the person who made the document is incapacitated.  That means he or she is unable to make decisions for him or herself.

In Oklahoma, if you do not have this document in place, no one is legally able to make medical decisions on your behalf and/or withhold life-sustaining treatment.

The Advance Directive will memorialize your wishes in different situations regarding life-sustaining treatment, allow you to choose a proxy to make medical decisions for you if you are unable to, and determine if you would like your organs and other body parts donated or science or transplantation.

Do Not Resuscitate Orders

Do Not Resuscitate (DNR) orders are often used by patients who are already suffering from serious illnesses. The patient, or agent for the patient in certain situations, indicates his or her wishes medical staff not try to resuscitate the person if they are in need of CPR. Healthy people will likely not want a DNR.  Healthy people will want to get CPR if they are in a life-threatening situation.

Durable Power of Attorney

Durable Powers of Attorney (DPOA) allow people to choose someone to help them with medical and financial issues, either immediately, or after they can no longer care for themselves. The agent chosen by the person creating the document can stand in the creator’s shoes to take care of matters on the creator’s behalf. The extent of the agent’s powers are outlined in the document itself. If you choose to have your DPOA go into effect immediately, you can override your agent’s decisions, unless you are incapacitated.

Without these estate planning documents, your family will wind up in Court, doing the best they can to make these decisions with a Judge’s supervision. If you have any ideas on how you want your care to go, and who you want to help, you need a plan. It is always wise to work with local attorneys instead of filling out online forms when making end of life care plans.

Local attorneys generally do not charge much more and they can walk you through the documents to help you understand them and tailor them to meet your specific needs.  They will usually also have a copy of your plans on-hand in case your family is unable to find your documents.


Why You Should Follow Hugh Hefner’s Example

By Sarah Stewart Legal Group

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We all know Hugh Hefner.  As the mogul businessman with the groundbreaking idea behind Playboy magazine, he was quite the controversial figure.  Despite your personal beliefs about Hugh’s business and life choices, he is a role model for all of us in one aspect of his life– Estate and Financial Planning.

Say what you will about Hef, but his business acumen was amazing.  He started Playboy in 1953 with $8,000 and transformed it into a global business.  Hef was able to take his eventual fortune from this business and plan well for his retirement and the twilight years of his active lifestyle.

Hef began planning for his future and his empire in about 2010 when he divorced Kimberley Conrad. Records show his net worth at the time was around $43 million and his income was about $3.5 million a year.

With the rise of the internet, Hef knew his business could suffer.  So, he made a decision in 2011 to make Playboy private by partnering with a private equity firm.  This move netted him more than $207 million. He included a deal in the purchase contract that gave him 37% of the stock and a $1 million per year income from the new business.

Hef took his estate planning prowess to a new level in 2012 when he negotiated a pre-nuptial agreement with his 3rd wife. Through the agreement, he established a trust solely for the benefit of the wife and kept all of his agreed, non-marital assets separate.

With this decision, Hef dodged a common estate planning bullet.  He was able to keep his wife happy and keep his assets separate and protected for his adult children.  Those who don’t take these steps in blended families, often have disagreements, and many times full out wars, over assets after the parent’s death.

It is likely Hef used several trusts to plan for his children and spouses after his death.  In fact, it is rumored that he even left half of his estate to a charitable trust to minimize estate taxes.

Hef’s one mistake was leaving his 37% share of the company tied up in stock.  Now, his heirs will have to sell the stock to realize the value, which is hard to determine since the public will not be able to purchase a private company’s stock.

Overall, though, Hef’s planning was sound and inspired.  He was able to take a business that would soon be affected by the technological revolution of the internet and turn it into a free home and yearly stipend. He was able to plan for the people who were most important to him without sparking a massive legal battle.  And, he even planned out his burial, purchasing a plot next to his first model, Marilyn Monroe. I have no doubt his family is eternally grateful for his foresight.

We can all take a cue from Hef’s playbook.  No matter the size of your estate, planning is essential, especially in blended families.  Make a plan for yourself and your loved ones centered around your retirement, and your eventual death. The hardest step is the first step.

Reach out to an experienced estate planning attorney and financial planner to help you plan for your retirement and family today!

4 Considerations for Retirement Planning

By Sarah Stewart Legal Group

Retirement planning is a difficult and confusing task.  But, it is necessary.  When planning there are 4 considerations you should address that could affect your retirement account’s bottom line and your lifestyle when you retire.

(1) Taxes

The only things certain in life are death and taxes.  No matter your age, you will be responsible for State and Federal taxes, including income taxes.  Make sure to account for future taxes in your retirement plan, or your future budget will be thrown off.

For instance, if you stash all of your money into a Traditional 401(k) or IRA, your withdrawals will be subject to income tax. If those monthly withdrawals are high enough, your Social Security income may be taxed as well. The solution is to plan for taxes while drafting your plan.

One tool to consider is a Roth IRA. Roth deposits are made with after-tax dollars, so future withdrawals are not subject to income tax or required minimum distributions.  So, Roth accounts can save you a large tax bill in the long run.

(2) Inflation

On average, inflation causes the U.S. Dollar to lose 3% of its value per year.  So, you must account for the fact that your retirement account will lose at least 3% of its value each year.  To beat inflation, be sure to pick a portfolio that has a historically high enough return to overcome the value lost.

(3) Long-term Care

People are living longer and longer each decade, making the costs of long-term care a likely item you’ll need in your retirement budget.  In our current market, long-term care can cost anywhere from $4,000 – $6,000 per month.  That’s quite the hefty price tag. Medicare usually won’t provide much, if any, assistance in long-term care and State and Federal funding in this area is constantly in flux and one of the first budget lines to go when States are tightening their wallets.

Consider getting long-term care insurance to help with long-term care expenses.  People generally can get low premiums on this type of insurance if they purchase it early enough, usually in their 50s.  It is easier to budget for the insurance premiums associated with long-term care insurance than it is to predict how much long-term care facilities will charge when you need them. But, always use an abundance of caution in planning for your long-term care expenses in retirement planning.

(4) Estate Planning

Anyone who has been through a probate can tell you what a burden the procedure can be for the family.  The burden only increases if you have not completed some form of estate planning. Probates are expensive, time-consuming, and emotionally draining for the loved ones you leave behind.

Also, if you do not take the time to write out a Will or other plan, the State will determine who gets your assets and how, based on the laws they have put in place for these matters.  You will need to consider your goals and wishes for your family and look at the pros and cons of having a Will, Trust, Durable Power of Attorney, Advance Directive, and other documents in your arsenal.

How to Avoid Probate on Real Property without a Trust

By Sarah Stewart Legal Group

Many people believe having a Will allows their heirs to avoid probate.  But, this is simply not true.  If a person has a Will, the heirs have to go to court to distribute the assets of the deceased.  The Will provides instructions to the Court for how those assets will be divided.

Though having a Will gives you control of who gets what when you die, it does not stop your heirs from having to endure the costs and stress associated with the court process of probate.

If you’re looking to reduce your heirs’ stress, and keep them out of Court, the most common estate planning tactic is a Trust.  However, if you are opposed to a trust for any reason, there are other probate avoidance options.

Probate Avoidance on Non-Real Estate Assets

Most people are aware of the options for probate avoidance for personal, non real estate, assets. Those options include, for bank accounts, naming payable on death beneficiaries and joint owners.  For stocks, bonds, and mutual funds, you can name beneficiaries and contingent beneficiaries.

In Oklahoma, you also have the option to sign and file a Transfer on Death Deed to allow your heirs to transfer your real property after your death by filing Affidavits and a Death Certificate with the County Clerk where the property is held.

Owner can Sell or Transfer without Permission of the Beneficiaries

A Transfer on Death Deed allows the owner to keep ownership of the property until the day he or she dies.  That means he or she can sell, lease, or doing anything else he or she wishes with the property without the consent of the Transfer on Death Deed beneficiaries. TOD Deeds also allow the owner to change his or her mind and choose new beneficiaries as he or she needs throughout his or her life.

In this respect, Transfer on Death Deeds are better than joint ownership, because if you need to sell the property or otherwise change your mind about ownership, as a joint owner, every owner has to consent to and sign off on the change.

Avoid Probate and Smooth Transfer

As discussed before, the property will transfer as soon as your heirs file their Affidavits and Death Certificate with the County Clerk.  There is no need to probate the estate, and no delay in the transfer of property.  The transfer is complete the day the Affidavits and Death Certificate are filed and your heirs can agree to do what they wish with the property.

TOD Deeds are one tool in a large toolbox available to you for estate planning purposes.  Everyone needs a unique and personalized plan that fits their needs and helps them reach their goals.  Please reach out to a professional to help you fully plan your estate.



How to Plan for Your Digital Assets

By Sarah Stewart Legal Group

What happens to your digital assets after your death?  Who takes care of your social media accounts, email, and online savings and checking accounts? What happens to those accounts when you die? Do they continue on inevitably, or can they be closed?

Though a large amount of estate planning still takes place with paper documents, digital assets are extremely common and must be addressed as well. Digital estate plans help determine if your digital assets have any monetary value and helps your loved ones know what you have and where.

(1) Inventory

To make a plan, you have to know what you have.  Compile a list of all the online assets you have and their usernames and passwords, including but not limited to:

  • Social media accounts
  • email accounts
  • websites
  • online insurance, bank, and credit card accounts
  • online bill pay
  • media files
  • online payment tools (Google Wallet, PayPal, etc.)

(2) Proper Storage of Your Inventory

Your inventory will have a lot of important, personal information.  You need to make sure you protect it. You can store the inventory in a safety deposit box at a bank, with an attorney, or in a safe. You may also consider online applications that were created solely for digital asset planning purposes, such as PasswordBox or SecureSafe.

(3) Name an Executor

Much like traditional estate planning, you will need to choose someone to manage your online accounts and assets. Make sure you choice is trustworthy, technologically savvy, and responsible. Give your Digital Executor information on where to find your inventory.

(4) Write Your Plan

What do you want your Executor to do with your digital assets? As with any estate plan, make sure your instructions are clear, to avoid confusion. Add a list of instructions for each digital asset you own.

(5) Pay Attention to Terms and Conditions

Review the terms and conditions for the places that hold your digital assets.  Each site may have different rules and procedures for handling assets of members after death. For instance, Facebook will allow you to close or “memorialize” an account.  Google has an “Inactive Account Manager” that allows users to decide what they want to happen to their accounts when they have been inactive for a predetermined amount of time. And Twitter requires more paperwork and redtape for families to access their loved ones’ accounts.

As our world becomes more and more digital, digital estate planning will continue to grow.  As you join new sites and amass more digital assets, be sure to update your plan so you don’t get so far behind you can’t catch up.

Tax Consequences of Naming a Trust Beneficiary of a Traditional IRA

By Sarah Stewart Legal Group

Trusts are estate planning documents that direct how your assets will pass after your death.  If the trust is properly funded, you heirs will be able to avoid probate when you die. Trusts can save your loved ones a lot of heart ache in the long run and allow your assets to pass smoothly from one generation to the next. Though, overall, a trust is a sound decision for your estate planning, no matter who you are, there are tax consequences of using a trust with a Traditional IRA.

People fund their Traditional IRAs with pre-tax dollars.  This means deposits made into the IRA are tax-deferred.  Tax-deferred means the IRS will take income taxes out of the disbursements when they are made.  The IRS will require Trust beneficiaries to take withdrawals once the account holder dies and taxes will be calculated accordingly.

Tax calculations for trusts that are beneficiaries of Traditional IRAs can become rather complicated.  If there is only one beneficiary, the withdrawal amount the heir is required to take will be based on the beneficiary’s life expectancy. Income taxes are generally based on the beneficiary’s tax rate.

If there is more than one beneficiary, mandatory distributions will be calculated by the oldest beneficiary’s life expectancy. This can force younger beneficiaries to take larger amounts, and pay more taxes than originally expected.

If a business, charity, or another non-person entity is named as a trust beneficiary, the IRA must be closed and distributed.  IRA disbursements are considered taxable income.  This can lead to a large tax bill for beneficiaries, depending on the size of the IRA. Tax rates will usually be calculated using the trust’s tax rate, which may also be much higher than the beneficiaries’. In 2017, the income tax rate for trusts was 39.6% after $12,400 in income.

If you have a ROTH IRA you will not have the same issues.  ROTH IRA savings are made with post-tax dollars.  This means you pay taxes on the money before you put it into the IRA.  So, ROTH IRA distributions are not taxed like Traditional IRAs.

If you have significant assets held in a Traditional IRA, you need to consider the pros and cons of naming a trust as a beneficiary of the IRA. Even if you use a trust for your estate plan, you can always name separate beneficiaries for your Traditional IRA assets and avoid the trust tax rate.  This may or may not be the best option for your situation.  Be sure to consult attorneys, tax advisors, and financial planners for your own estate planning purposes.

6 Concerns When Making Your Home Senior-Friendly

By: Sarah Stewart Legal Group

Many baby boomers are aging, causing a spike in our elderly population.  To prepare a home for an aging loved one, you must consider some unique challenges seniors face.  For example, seniors are known to fall more frequently than their younger counterparts, have mobility issues, and have more trouble with their sight.

Today, we will discuss 6 concerns when making your home senior-friendly, whether for yourself or a loved one.

(1) Bathroom Accommodations

Walking and standing on slick, wet surfaces can be difficult for anyone.  This is especially true for our elderly population.  To help seniors lower their risk of a serious fall and injury, consider adding a walk-in tub with a door that opens into the tub/shower and shower seating.

(2) Lights

Lighting can help prevent falls in the home.  Simply putting lighting in places like stairways and near steps can show people where they need to place their feet so as not to fall. Lighting also helps seniors see better in general, improving their quality of life when aging in place.

(3) Accessibility for Walkers and Wheelchairs

Seniors may need the help of a wheelchair or walker to get around.  Widening hallways can help prevent falls and allow elders greater mobility.  Also, adding ramps in place of stairs can make access easier for everyone.

(4) Heights of Cabinets and Countertops

Changing countertop and cabinet heights can help prevent falls for those with limited reach. Shelves that rotate are also an option to provide better access.  They can swing out to accommodate seniors and be returned after use.

(5) Access to Second-story

Many seniors have a hard time getting up and down stairs.  If you or your loved one have a second story, you should consider installing an elevator or chair lift. You may also want to consider moving the sleeping area for the senior to a downstairs room.

(6) More Concerns

Seniors face issues other than mobility, falls, and sight.  They may find it hard to hold or grip everyday household items like door knobs or faucets.  Consider installing new faucets and knobs that they can use.

Each senior will also have their own, unique set of limitations.  Be sure to address those needs and concerns in your loved one’s home.


3 Considerations When Choosing an Executor

By Sarah Stewart Legal Group

When choosing an executor, or deciding if you want to be one yourself, remember the job isn’t easy. The executor manages the estate of the deceased, usually while in the throes of their own grief.  They are responsible for taking the estate through the court system, accounting for estate assets, and filing any necessary tax returns.  The job is thankless, difficult, and can last for a long time, depending on the circumstances of the estate.

Due to these difficulties, there are some things to consider when choosing an Executor:

(1) Work Ethic

Generally speaking, the better your estate plan, the less work your Executor (or Trustee) has to do.  However, if you have a Will in your estate plan, you will need to ensure the Executor you choose has a strong work ethic.  The more assets you have, the more important this quality will be.  Probate can last for a long time, and can cause friction in even the best of families, so you need to be sure your Executor has the perseverance to handle these kinds of issues, work through them, and hang on for the ride.

(2) Focused

You need to be sure your Executor is someone who can reasonably organize all of your assets and follow your instructions for how to transfer your assets.  Your Executor must be focused and reliable.

(3) Capable

Your Executor will have to be able to get information from financial institutions.  They may also be responsible for selling and/or distributing your assets to fulfill your wishes.  You need someone who is capable of working with your financial institutions and assets. You need someone capable and trustworthy.


There are many ways to make the job easier for your Executor.  Avoiding probate is one of the most beneficial things you can do for your loved ones.  One way you can do this is by establishing a trust.  You can also make sure your life insurance policies, retirement accounts, bank accounts, etc. have named, and updated, beneficiaries.  Beneficiaries and joint owners receive their funds without having to go to Court for a probate.

In Oklahoma, we also use Transfer on Death Deeds for real property.  If you do not have a trust and want to make the Executor’s job as easy as possible, you should consider a Transfer on Death Deed for the real estate you own.

The Deed only becomes effective when the owner dies.  So, before death, the property can be sold or transferred in any way the owner needs without the Beneficiary’s permission.

To establish your best estate plan, contact a professional today!

Ask Your Financial Advisor These 5 Questions

By Sarah Stewart Legal Group

There are a wide variety of financial advisors to choose from nowadays.  Some are fiduciaries, required to act in your very best interests, some are not.  Some have extensive credentials and training, some just left their previous career as a bartender at your favorite club.

With so many options available, how can you choose the best financial advisor for you? Today we discuss 5 questions to ask your advisor to make sure they are the right fit for you.

(1) Are You an Investment Advisor or a Financial Planner?

There are a wide variety of Investment Advisors in the Financial Planning world, there are also Financial Planners. Investment Advisors do exactly that–they help you decide on the best investments to make, usually in stocks, bonds, and mutual funds.  Financial Planners have a wider scope.  They assist in helping with budgeting, investing, estate planning, and insurance policies.  These two worlds are not necessarily mutually exclusive.  Many of the best Investment Advisors will consider your financial plan as a whole and many Financial Planners have experience and success in choosing proper investments.

So, this is not the only consideration in this question.

If you want an Investment Advisor: Ask about their investment strategies.  Do these strategies align with your own? What types of investments does the advisor prefer? Can you understand their investment strategies? Are they a chartered financial analyst or do they have one on their team?

If you want a Financial Planner: What is the planner’s desired demographic and expertise? Identify situations unique to you and ask the financial planner about their experience in that area. Ask if they are a certified financial planner or chartered financial consultant.

(2) Do You Have Fiduciary Responsibilities?

A fiduciary must put your interests before their own when making choices about your retirement portfolio. Many financial advisors are fiduciaries. Registered investment advisors, or those who work for registered firms, are usually fiduciaries as well.  Fiduciary responsibilities may not affect all areas of your retirement portfolio with that particular advisor, so be sure to ask, and understand, where their fiduciary responsibilities end.

(3) How Are You Paid for Your Services?

Are they commission-based, fee-only, or fee-based?  Those who work on commission get a commission for recommending a particular product.  Fee-only advisors do not receive commissions.  They are paid by charging certain fees for certain services. Fee-based advisors receive commissions and fees for the products they sell.

(4) What Are Your Credentials and/or Designations?

Advisors can carry specific designations.  These are explained below:

Financial Planners:

Certified Financial Planner- CFPs must finish an educational program, pass a financial planning exam, and have extensive financial planning experience.

Chartered Financial Consultant- ChFCs must complete an educational program, pass several exams, and have extensive financial planning experience.

Investment Advisors:

Chartered Financial Analyst-CFAs must pass a rigorous educational program with a series of exams and must have experience in investment decision-making.

(5) Do You Have a Backup Plan?

What happens if the advisor leaves the business, is on vacation, or becomes disabled?  Is there someone else who will step in as your advisor? There should always be someone available as a backup contact when your advisor is unavailable.

What We Can Learn from Philip Seymour Hoffman’s Estate Mistakes

By Sarah Stewart Legal Group

We all know Philip Seymour Hoffman.  He was the lovable actor who made appearances in many movies, including Twister, The Big Lebowski, Capote, and the Hunger Games movie series.  His death in 2014 was a tragic end to an acclaimed life. Unfortunately, like many stars before and after him, Hoffman made some disastrous estate planning mistakes.  Today, we will learn from him.

Hoffman died with a $35 million estate.  His girlfriend and their 3 children survived the actor. Hoffman chose a Last Will and Testament as his estate plan for his family, due to his stigma against trusts. He was determined that his children would make their own way in the world and not become “trust fund babies.”

Hoffman’s stigma and choice led to his estate owing $12 million in taxes.  Had Hoffman chosen to marry his girlfriend, or used appropriate estate planning tools, he may have been able to save his family that $12 million.

Hoffman also demanded that certain funds be used for specific purposes for his children and their education, something that Representatives of Wills are not required to do by law. Only a trust requires the Trustee to follow your express restrictions as to when and how money will be used for heirs.

Hoffman’s choice of using a Will saddled his family with more costs, delays in receiving their funds, and allowed the proceedings to be public record. Courts take fees for every probate filed.  Attorneys take fees as well. Creditors must be notified of the death and are allowed to file claims for money.  Should the probate require additional work, such as selling property, there may be even more exceptional fees tacked on to the final bill.

Also, Hoffman’s children are still minors.  This means, given the large amount of his estate, the Court may require Guardians to be appointed to manage those funds.  The Guardians would likely be required to establish trusts for the children’s benefit so the funds are properly managed. In essence, Hoffman’s children may become “trust fund kids” regardless of his best intentions.

Hoffman’s choice left his estate open to his girlfriend’s creditors, possible new husband/boyfriend and future kids, as well as a possible second dip into the assets for a second round of estate taxes on his girlfriend’s death.  Trusts options would have allowed Hoffman to avoid all of these additional problems. Pre-planning your estate is vital for any estate, but large estates especially.

Estate planning, and trusts, provide so many different avenues to reach your planning goals.  Trusts can provide tax benefits, restrictions on how or when funds will be used, protect your heirs’ funds from their creditors and/or divorces, and other lawsuits.

Though Oklahoma has no estate tax, other states do.  If you live outside of Oklahoma, you will need to consider your state’s estate taxes as well as Federal estate taxes in your planning.

Reach out to a professional to help you plan your estate.  Don’t wind up making the same mistakes as some of our most famous and wealthiest stars.

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