Many South Carolina residents decide to invest in a college savings plan in order to help fund their child’s future college expenses.  The state of South Carolina offers different plans to make the savings process easier on you.  If you’re thinking about taking advantage of a college savings plan, take a look at the information below to learn more.  If you have any questions about choosing the best college savings plan for your individual needs, meet with an estate planning attorney.

This blog post is part of at two part blog article discussing South Carolina savings plan options.  This post will take a close look at the South Carolina Tuition Prepayment Program.

What is the South Carolina Tuition Prepayment Plan?

This is a plan that was created in 1998 to help South Carolina residents pay for the costs of college.  This plan is currently not open for new enrollment until the state chooses to accept new participants.

It’s a good idea to keep an eye on this plan so that you’re able to take advantage of its benefits when new enrollment is accepted.

This plan allows individuals to prepay for a college education of their choosing.  This includes choosing between a 2 year degree or 4 year degree program.

This program also offers different payment plans to make it easier to save.

What are the benefits of the South Carolina Tuition Prepayment Plan?

One main benefit is the fact that you’re investing in an actual college tuition and are able to choose the best plan that fits your child’s needs.

There are also tax benefits.  You’re able to take advantage of state tax deductions based on the contributions that you make each year.  Your earnings are also free from federal taxes.

This program makes it possible to save for college costs easily.  You should keep an eye on this program to take advantage of enrollment, when possible.

If you have any questions about your South Carolina college savings plan options, consult with a qualified estate planning attorney.

Kuhn & Kuhn Law Firm is a member of the American Academy of Estate Planning Attorneys.

Parents with young children need to take extra care to make sure that they have an effective estate plan in place.  This will ensure that their children are always protected.

Our previous blog entry discussed some important planning tips for parents.  We’ve taken the time to compile additional tips.  If you have any questions about the below information, or if you’d like to begin your planning, meet with an estate planning attorney.

• Discuss your planning with your loved ones. It’s a good idea to reassure your loved ones that you’ve taken the time to plan.  Not only does it allow them to have peace of mind that you’ve protected your assets and yourself, but also that you have a plan in place for your children in case of an emergency.  It’s a good idea to discuss different aspects of your planning with your loved ones so that they have a better understanding of your decisions.
• Consider creating a trust. A trust allows you the opportunity to leave assets to your minor children.  Because your children are minors, you’re unable to leave money to them directly.  They are legally unable to inherit.  Instead you will be able to appoint a trustee who will be responsible for managing the assets that you leave.  This is a great way to make sure that your children have enough money needed for the necessities and care.
• Ask your estate planning attorney about your specific needs. An estate planning attorney will be able to identify and understand your specific planning needs.

For example, do you have a child with special needs?  If so, your attorney will recommend certain planning techniques that will allow you to protect your child.

It’s important to be open and honest with your attorney so that you have the best plan possible and that your children are able to get the level of care that they need.

If you have any questions about the above tips for parents with young children, or if you’re ready to start your planning, consult with a qualified estate planning attorney.

Kuhn & Kuhn Law Firm is a member of the American Academy of Estate Planning Attorneys.

Many parents with young children don’t understand the full importance of estate planning.  An estate plan not only protects you and your assets, but it can also serve as a way to protect your children.

There are certain estate planning steps to follow in order to make your plan effective and allow you to make sure that your children are always cared for.

Take a look at some of the tips below.  If you have any questions, meet with an attorney.

• Cerate a will and designate a guardian.  While this can be a very hard decision to make, it’s necessary.  If you’re ever unable to care for your children, you want to make sure that the right person is taking care of them.  It takes a lot of thought and consideration to choose a guardian who you think will be able to handle all of the responsibilities that go along with caring for your children.
• Discuss your choice with the guardian who you’ve decided to name.  You want to make sure that he or she is willing and capable to care for your children.  It’s also a good idea to discuss some of your personal goals about how you’d like your children to be raised.  This can help give everyone a better understanding of the commitment as well as what is expected.
• Purchase life insurance.  If you want to make sure that your children are still cared for after your death, you likely need to purchase this valuable insurance.  Your life insurance proceeds can be used to pay for the care of your children.  Just because you have nominated a guardian does not mean that they will be able to handle all financial aspects of caring for your child.

Parents with young children who are looking for estate planning advice, should consult with a qualified estate planning attorney and check out part two of this two part article.

Kuhn & Kuhn Law Firm is a member of the American Academy of Estate Planning Attorneys.

The “I love you” will is NOT a good way to leave assets to your spouse.  An “I love you” will is as simple will that provides all assets to go directly to the spouse.  If the spouse is not then living, the assets go to the children.

Why you shouldn’t leave your assets to your spouse:

• Outright assets often never reach children.  Children are often unintentionally disinherited  by their parent and intentionally disinherited by a step-parent.  Instead, pass the assets to your surviving spouse in a trust.

• Outright assets have no asset protection.  They can be taken by your spouse’s creditors  or predators.  In other words, the assets can be seized in a subsequent divorce, bankruptcy or other creditor action such as a malpractice suit, car accident, slip and fall, or business failure.  Predators are charities, ministers, financial advisors, and others who prey on widows (and widowers.)

• Windfall assets are typically gone in 18 months.  When a spendthrift beneficiary, spouse or otherwise, suddenly inherits a windfall, the assets are spent and there is nothing left to support the spouse or to be inherited by the children.

• An outright inheritance may disqualify a special needs spouse from receiving governmental assistance.  For instance, if your spouse is receiving Medicaid payments to pay for nursing home care, an outright inheritance will disqualify her.  On the other hand, if the inheritance is in trust with special needs provisions, your assets can be used to make her life better, supplementing, not supplanting what the government pays for.  Thus, your hard earned assets aren’t wasted.

• Outright inheritances to a spouse do not use your lifetime exemption and may lead to great tax liability.  (We’re ignoring portability at the moment due to its limited applicable time frame, vagueness, newness, and requirements.)

Pass your assets in a trust to avoid all 5 of these outright inheritance issues.  Your spouse can be the beneficiary of your trust and use the assets for her needs, health, education, and maintenance.

Kuhn & Kuhn Law Firm is a member of the American Academy of Estate Planning Attorneys.

If you’re like most people, you think of social security as retirement benefits.  And, it is.  However, the social security program has survivorship benefits as well.

Surviving spouse

The surviving spouse (or children who are eligible for benefits, if there is no surviving spouse) is entitled to a lump sum payment of $255.

The social security administration provides benefits for a surviving spouse once she attains a certain age.

The surviving spouse can receive 100% of the deceased spouse’s social security benefits if she is 65 years of age, or, perhaps, older, depending on her date of birth.

If the mandated retirement age isn’t yet met, a smaller social security payment may be received.  For example, a smaller payment is made if the surviving spouse is 63 and the retirement age for her year of birth is 65.

Note that if the surviving spouse gets remarried after the age of 60, retirement benefits from the first spouse continue.

While the surviving spouse cannot collect double payments from social security (i.e. her deceased husband’s and her own), she can choose whichever payment is greater.

Ex-spouses

So long as the marriage was 10 years or more, a divorced spouse of the decedent (who has not remarried before age 60) receives full social security payments for life, starting at age 65.  Reduced benefits are available, starting at age 60.

It is possible for an ex-spouse and a second spouse (i.e. surviving spouse) to both collect social security payments based upon the same decedent spouse.

Children

Children age 18 and younger (or, 19 and still in high school) are entitled to monthly social security benefits.

Disabled children can receive social security survivorship benefits for their lifetime so long as they continue to be disabled.

Other beneficiaries

If the decedent had grandchildren or great-grandchildren or dependent parents (age 62 or older), they may be entitled to social security survivorship benefits as well.

Kuhn & Kuhn Law Firm is a member of the American Academy of Estate Planning Attorneys.