Many military families—particularly young families—need financial and estate planning advice. With the risks of going into a wartime situation or the potential for a training accident, service members have a greater than average chance of disability or premature death.
The Wall Street Journal article, "How to Serve Military Families," says that in many instances military spouses are young and financially immature. Military families don't settle in one place for very long, so a nonmilitary spouse may have trouble finding a steady job that would provide a second income and a retirement plan. In that situation, if something happens to the service member, and benefits are paid out, they need to be able to access them immediately. It's more likely that young military families will need help getting these estate documents in order and updating their beneficiary designations.
Financial and estate plans can't be static. They need to reflect a family's current life situation. For example, beneficiary designations on retirement plans need to be reviewed and updated, and many soldiers and sailors name a boot camp buddy as the beneficiary of their Servicemembers Group Life Insurance (SGLI) policy after they enlist. This needs to be changed when they've married and have had children.
Retirement and insurance plans pay named beneficiaries, separate from the will. A service member's will may provide that his or her child can't access the assets left in trust until he or she reaches age 25. However, if the child is a named beneficiary of an SGLI policy, the proceeds will be paid directly to the child if he or she is 18 or has attained the state's age of majority; or they will be paid—regardless of age—to a legal guardian who may not be the person the service member would have chosen to manage these funds for his or her child. Another way to go is to have a trust for the child be the insurance beneficiary.
Real estate is another area of concern for military families who move frequently and may own property in multiple states. If the service member is killed, the property may end up in probate without the proper instructions. One might even think about starting a limited liability company for the property and speaking with an experienced estate planning attorney about setting up a living trust to hold real estate assets during his or her lifetime that also names a beneficiary in the event of his or her death.
The laws are different in different states as well as when service members are stationed overseas and own property. Because military families move often, it is important to have your estate plans reviewed when moving to a new state or country to make sure the laws of your new location will accommodate your plan
One of the main goals of our law practice is to help families like yours plan for the safe, successful transfer of wealth to the next generation. Call our office today to schedule a time for us to sit down and talk about your estate plan, where we can identify the best strategies for you and your family to ensure your legacy of love and financial security. Our office is located in Santa Ana, CA but we serve all of California including Irvine, Orange, Tustin, Newport Beach, and Anaheim.
Reference: Wall Street Journal (April 19, 2016) "How to Serve Military Families"