Palm Springs Law Blog

Wednesday, April 22, 2015

Money Matters

I handle estate planning for people who have a handful of assets, tons of assets, and everything in between. Other people have serious financial problems, and I help them file bankruptcy, so they can get a fresh start. And some folks are married or registered domestic partners and need me to file for a dissolution of the relationship. Whatever your fortune or misfortune, money and other assets are usually the focus of my work. Here are some notes and suggestions that can help protect what you already have, or regain a solid footing when you need it:

  • Finding Money: You or a family member may have money waiting for you.Unclaimed monies must be turned over to the state by financial institutions and other companies. The state then must try to find the rightful owners. There is no charge to check these two official websites to search for unclaimed property:

Be wary of companies that charge you or send “special offers” to locate funds for you. Some are legitimate, but some are not. Check the above websites first.

  • Finding More Money: Did someone pass away recently? Could you be the beneficiary of a life insurance policy? To get any information from insurers, you must have the authority to discuss the matter with them. You must be the executor or administrator of the decedent’s estate, a member of the immediate family; or have written authorization from that person for the insurer to release information to you. You will need a certified copy of the death certificate and as much information as you can find about the policy itself. Contact the insurer’s main office to see if they are permitted to talk to you as a possible beneficiary. If the death was a long time ago, it is likely that the funds have already been turned over to the state and will turn up on the websites listed above.
  • Marrying for Money: When you marry or register as domestic partners in California, look carefully at both of your financial situations. You each bring separate property to the union, and can choose whether to keep all of your property separate, or co-mingle some or all of it. What you acquire after the union will usually belong to both of you as community property. You can choose how to identify all of your property by creating a premarital or post-marital agreement.
  • Splitting Up Money: Sometimes things just don’t work out. You married, registered, or were in a committed relationship, and now you want out. Were you smart and signed that pre- or post-marital or cohabitation agreement? If you did, your path to single life should be fairly smooth. Everyone is clear on who owns what and who gets what when the relationship ends.

Forgot those agreements in the thrill of romance? Unless you both agree completely on who is entitled to all the assets and debts, your escape from the union is likely to be painful. To dissolve a marriage or registered partnership, each person must provide very detailed financial information and documents that will serve as a basis for the two of you and the court to determine what is a fair settlement of your property. If your partnership was simply a committed relationship, it is not recognized as a union in California, and you and your partner must sort things out by yourselves. A civil lawsuit could be filed to try to settle disagreements, but the process is very complex and expensive.

  • Erasing or Reducing Debts: Financial problems can hit any of us, any time. Student loan debts drag many of us down. Although most of these debts can’t be discharged in a bankruptcy, some can be reduced or forgiven through various programs. Get a job in public service, government or with a non-profit entity. Join the military. Apply for the Income-Based Repayment Plan. For certain student loans, become a public school teacher in a low income area. There are many other forgiveness programs that could help. Check first with your loan provider, who should be able to identify the programs that might work for you.

Housing debts are a major contributor to bankruptcies. If your mortgage is more than the value of the property and it is tough making the payments, it is possible the lender will foreclose and you will lose your home. There are several good refinancing programs available now. Check with your lender for options.

If refinancing doesn’t work, and you are in genuine financial distress, consider bankruptcy. It can often stop an imminent foreclosure, help reduce or wipe away your other debts, and make it possible for you to retain your home and start off with a clean slate.

  • Giving Away Money: Many folks give gifts to family members and charities. There may be tax consequences for these gifts, and it is crucial that you check with your tax professional to review these first. When choosing charitable organizations for your gifts, do careful research. Are they well-managed and are they actually accomplishing what they set out to do? Use these websites to learn:

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