Lynnette Khalfani-Cox is known as The Money Coach®; she’s a personal finance expert, television and radio personality, and the author of 12 books, including a New York Times bestseller. She recently reached out to John McManus for guidance on how to avoid a quandary like the one her family faced when three loved ones passed away in short order.
Writing for Get Rich Slowly, a personal finance publication with over 750,000 regular readers, The Money Coach® shares her heartbreaking story, which includes a nightmare custody proceeding after her sister passed away.
The individual named to care for Khalfani-Cox’s niece was unprepared emotionally to take on guardianship duties due to being devastated by the death. From the article:
While the situation was ultimately resolved, experts say one easy solution could have helped avoid a lot of unnecessary pain and financial drain.
“It’s job #1 and mandatory to name alternate guardians in a will,” says attorney John McManus, head of McManus & Associates, a trusts and estates law firm in New York.
An alternate guardian steps in if, for any reason, your first-choice guardian is unable or unwilling to serve in that role.
As explained by Khalfani-Cox:
McManus insists on alternate guardians being named because he has seen too many sad situations where kids have become orphaned, taken in by uncaring or greedy relatives, or even abandoned when an originally named guardian has a change of heart or dies…So McManus offers a clever remedy: “We recommend the creation of an advisory group.”
This advisory group consists of three to six close family members or friends, who agree to collectively help ensure a child’s well-being and safeguard his or her educational needs, medical welfare, religious instruction and more.
The piece also addresses the often unanticipated costs of inheritance, which can add up to hundreds or even thousands of dollars when specialty items are involved. Advice from McManus in the article:
“Certain items pose unique difficulty to transport to the intended beneficiary,” says McManus. “Think about moving a concert grand piano across the country,” he says. “It is important to consider how such costs could deplete inheritances to loved ones.”
Inheriting other specialty items — like liquor or even gun collections — can be particularly thorny. “Wine collections, for example, will require someone with a liquor license to move any amount greater than five gallons across state lines without incurring a tax,” McManus notes.
And what if your grandfather was a history buff who left you his collection of Revolutionary and Civil War rifles? “If a beneficiary receiving a gun does not live in the same state as the decedent, it will be necessary to hire a registered dealer to arrange delivery,” McManus says.
What’s the solution? “Make sure the will provides for those costs,” according to McManus.
In summation, Khalfani-Cox emphasizes that proper financial planning and having a Plan B is key. A quote from McManus aptly punctuates the piece:
“Expect the best, of course,” says McManus. “But you’ll be glad you planned for the worst if you’re ever confronted with it.”
Read McManus’s advice on naming alternate guardians in a will, creating an advisory group, and planning for the costs of inheritance in the full article from The Money Coach®. To safeguard your family against the unexpected and ensure that your final wishes are fulfilled, reach out to McManus & Associates for a detailed review of your last will and testament (908-898-0100 or firstname.lastname@example.org).