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real estate law

Estate Planning for Farmers

Everything about farmers is unique. Farming is unlike any other business. As many farmers will say, farming is not just a job, it’s a way of life. That means that farming is a way of life through thick and thin. With farming you don’t just go to work and go home when the job is done. You live at your job. You live in the same place you work. But the truth is, most farmers would never change their way of life unless they absolutely must. In addition to that, they want to pass it on to their kids. And they want their kids to pass it on to their grandkids. Or, at the very least, they want the land to stay within the family.

Farming Finances

The finances of farming are also very unique. Often the assets of a farm far outweigh the income of a farm. Speaking from an estate planning perspective, this creates a unique estate planning situation. According to the USDA’s Census of Agriculture, the state of Minnesota in 1997 had 78,755 farms. In the latest census in 2017, the state had 68,822 farms and this number keeps shrinking.

Aside from the obvious that more and more people are leaving the profession, it also means there is a lot of wealth transfer that has happened over the last 20+ years. Additionally, the average age of farmers is 58 years old according to the same census. That means there will be a lot more wealth transfer in the coming years.

Watch This Month’s Video To Learn More

Kiecker Law Video Series Ep. 2 – How Do I Transition the Farm to my Children?

Real Estate Planning for Farmers

When we talk about estate planning in farming, there are so many factors to consider. Everything from the amount of land to the value of the machines to the amount of cash in the bank to which, if any, kids want to take over the farm to how you want to divide up the assets and money. In a certain sense, this is just like any other business owner. In another sense, it’s completely different. Again, farmers are unique.

As mentioned before, farming isn’t just a job. It’s a way of life. If you want to pass the farm on to one kid, but not the other, the estate plan could be written many different ways. You may want all the kids to be treated the same financially, but that means the estate plan must be written a specific way. If you want the kid that is taking over the farm to be treated differently than the others, you must write the estate plan in a different way. If you want to give the farm away, you can do that, but you need to do it a specific way.

Succession Planning for Farmers

So, what does that mean? It means that there is no one-size-fits-all answer. It means that when you’re considering the succession planning of your farm, you need to be aware of all the options that are available. There are many different outcomes that you may want and there is likely a way to accomplish each of those. Each one of those solutions is unique. Proper planning is essential to accomplishing the outcome that you desire.

To be sure, the legal system has set up a plan for you if you don’t do your planning. Likely, no one will be happy with that one-size-fits-all solution. It will likely lead to many arguments and many people that are upset with each other. Again, we know farmers are unique. We know that each situation is unique. Make sure that your plan is also unique. 

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estate planning ultimate guide to retirement

Estate Planning for Retirees

In our last blog post, we talked about why someone that is retired or nearing retired would want to write their wills. This time we are going to talk about what makes up a true, full estate plan. A complete estate plan includes more than just a will. It also may include a trust and it does include a health care directive, a financial power of attorney, and also requires you to update your beneficiary designations. So, what does that mean?

Will

Let’s start with what a will does. A will determines who gets your stuff when you pass away. It also appoints the person that is going to be in charge of distributing your property according to your wishes. For those that still have minor children, it also appoints a guardian for them. If you don’t have a will, the state does have one for you, but you and your heirs are at the mercy of a judge at that point. Not having a will is a good way to put undue stress on your loved ones after you’re gone.

Trust

A trust is often known as a living trust as well. The main purpose of a trust is to continue to control your assets while you are living, but also provide a vehicle to pass on your assets to your heirs without having to go through the probate process. A trust can potentially help avoid negative estate tax consequences. It avoids probate if structured properly and it provides a way of keeping your and your family’s finances private. It is likely less time consuming when administering the trust is potentially a less expensive way to distribute your assets.

Health Care Directive

A health care directive is simply a way to make sure that your medical needs are taken care of in the manner that you want them to be. You determine who will make medical decisions for you. You can lay out the exact methods of medical care that you want to be done or not done if necessary. Copies of these should be given to all of your doctors so they know what to do or who to turn to if something should happen to you.

Financial Power of Attorney

A Power of Attorney provides the ability for someone of your choice to make financial decisions for you when you are not able to make those decisions yourself. It allows your representative to pay your bills for you when you can’t so that you can get back to life as you knew it when you’re able to resume.

Beneficiary Designations

This isn’t a document that an attorney can write for you, but an appropriate estate plan will include a discussion about your designations. It is simply an activity that you must do. Each of your life insurance policies, financial accounts and retirement accounts have these. If titled correctly, you are able to protect them from the probate process and make sure that they will go to the right people or organizations.

Obviously, there is more to it than these simple explanations. We will be holding a seminar in Belle Plaine at the KingsPath Senior Living facility at 125 Commerce Dr W at 4:00 on October 24th. You can click below to get registered for them.

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estate planning ultimate guide to retirement

Estate Planning For Retirees

In our last post we touched on some of the reasons that you may want to complete your estate planning in your retirement. This time we are going to dive a bit deeper. Specifically, we are going to look at the effects that it has on your heirs.

As part of an estate planning process, we naturally see the benefits of a good estate plan and the downfalls of a bad estate plan. Often times we see those effects in the probate process after a person has passed away and the heirs of an estate are left to deal with aftermath. To be clear, the time after a parent dies is NEVER easy, but how the estate is set up is key to making the legal aspect easier. First, let’s back up a bit and touch on the part of an estate plan that is used while a person is still living. The health care directive, or sometimes called a living will, is simply instructions to your family members on what to do if your health fails and you can’t make medical decisions for yourself. You can decide what decisions should be made for you when you are ill, but you can make those decisions now. You can tell your spouse, children or any other person you trust what kinds of medical measures should be taken and which ones you don’t want taken. This type of document helps your family to make the “right” decisions for you.

In conjunction with a health care directive is a financial power of attorney. A power of attorney is needed in a situation where someone is going to be unable to conduct business for an extended period of time. The power of attorney gives a trusted person the ability to conduct financial transactions for you. They can go to your bank and speak for you, they can pay bills for you and they can work with your investments on your behalf. It gives you the ability to not worry about your everyday life and focus on your health and still know that everything will be in order when your health is better.

When the eventual day comes that a person passes away, wills and trusts again provide a road map for your heirs on what you want. Wills and trusts both help with this process, trusts just provide a few extra layers of protection. We aren’t going to get into all the specific details as each person’s situation is different so it’s best to talk to your attorney before deciding what is the best option for you. For now, we’re going to focus on what we have seen to be the downfalls of not having either a will or trust.

To be clear, there is a plan for you if you don’t have one… the government has a plan for you. The government will eventually decide who gets what, but that is likely not what you want to happen. It’s also likely not what your heirs want to happen. All too often in this circumstance, brothers and sisters that go through this process end up never talking again. They end up thinking that they got the short end of the stick and their sibling “got more and didn’t deserve it”. These sorts of things end up being life long fights between siblings. Often it is said that writing a will isn’t for you, it’s for your kids (even if they are adults). It’s to make sure that what you want done with your assets and your money is what is actually done.

The arguing between siblings is an unfortunate reality with many families. We’ve seen it between families that seemed to always get along not matter the circumstances. Too often we see good families broken up because of money. Wills and trusts are very good ways to prevent that.

It’s because of these realities that Omni Kiecker Esq. of Kiecker Law is holding a pair of seminars called Estate Planning: The Ultimate Guide to Retirement on Thursday, August 22nd. In the seminar, she will be talking more in depth about these issues and give some insight into how to choose the people in your health care directive and power of attorney. She can also give you some tips on how to decide how you want your assets split up whether it is your kids or a charity. And she will also give you an idea on some other actions you can take to protect yourself in your retirement.

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estate planning ultimate guide to retirement

Estate Planning: Ultimate Guide to Retirement Seminar

Wills, Financial Power of Attorney, and Health Care Directives

Over the course of time, the reasons for completing your estate planning changes. To better understand, first we need to define what constitutes a complete estate plan. The most obvious instrument an estate plan is a will. That’s the one that everyone thinks of. It certainly is important as it lays out who gets your money and other stuff and, if you have minor children, who will take care of your children if you are no longer there. Unfortunately, many people forget the important Financial Power of Attorney and Health Care Directives. These documents are to help guide people in health care decisions as well as keep your financial affairs in order if you are in the hospital and can’t speak for yourself. These three documents are essential in any estate plan.

Trusts & Privacy Planning

The last piece of the puzzle may be a trust. Some people will need to have trust and some people won’t. It truly does depend on your situation. It depends on the level of your wealth. It also depends on your children and their financial aptitude. Some people may not want the general public to know their financial affairs when they pass away and will use a trust to keep their information private. There are a multitude of other reasons that you may want to use a trust. You will want to consult with your attorney on whether a trust is necessary for you.

Estate Planning for Retirement

Getting back to the reasons why you would complete your estate plan, when you’re young and single, your biggest need is typically going to be to make sure that you’re taken care of if you’re in the hospital and can’t make decisions for yourself. When you have kids, you obviously want to make sure your kids are taken care of if something happens to you.

The next phase in life is the part that we will be talking about in our August seminars: Retirement. You save your entire life in things like savings accounts, 401(k)s, IRAs, and any other number of financial vehicles. Presumably, you have saved enough for you to live on for 20, 30 or 40 years. Now, you want to protect that if something happens to you. Maybe you want to pass it to your kids. Maybe you want to give it all to your church or favorite charity. Or maybe you just want to make sure that it won’t all be used for a nursing home to care for you. Additionally, you want to make sure that everyone knows exactly how you want your health care to be carried out and someone to pay your bills for you if you are in that nursing home.

The Ultimate Guide to Retirement Seminar, August 22, 2019

All of those topics and more is what Omni Kiecker, Esq. of Kiecker Law is going to cover in the seminar “Estate Planning: The Ultimate Guide to Retirement” on Thursday, August 22nd. There will be two seminars, one at 3:00pm and one at 6:00pm in the Sakatah Trail Room in the Greater Mankato Business Development Building. Please see the links for the below for the registration page or you can call (952) 843-8546 to get registered as well. Space is limited so please reserve your spot. All guests in attendance will receive a copy of the “The Ultimate Retirement To-Do List” to keep as well.

You can also keep following our blog as well as our Facebook page to get more information as the month goes on. We want to keep providing more information on why this is important and help you make the best decision for you.

We look forward to seeing you at the seminars helping you prepare for or continue working through your retirement.

Estate Planning: Ultimate Guide to Retirement Seminar 1

FREE Admission Registration Open Now
Date and Time:
Thu, August 22, 2019
3:00PM – 4:00PM CDT

Location:
1961 Premier Dr
Sakatah Trail Room
Mankato, MN, 56001

Estate Planning Ultimate Guide to Retirement Seminar 2

FREE Admission Registration Open Now
Date and Time:
Thu, August 22, 2019
6:00PM – 7:00PM CDT

Location:
1961 Primeier Dr
Sakatah Trail Room
Mankato, MN 56001

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