Estate Planning to Prevent Typical Problems
Sadly, when a loved one dies and people should be thinking only about caring for those left behind, many are often obsessed instead with who got what. Those family members who find themselves embroiled in an estate battle discover that the cost of contesting a will consumes a large part or all of the estate. They lose any inheritance and their family, all at once.
While death is pretty certain for all of us, no one is ever quite prepared. This includes those we leave behind, who must deal with the pain and grief of losing a loved one and with legal matters, insurance companies and contentious family members. The Huffington Post’s article, titled “5 Ways to Plan Your Estate,” says you can make this process a lot easier for your loved ones with these estate planning tasks.
- Pay all your bills. This includes debts and taxes. Your beneficiaries won’t receive a dime until your bills have been paid. The probate court will notify the public, including creditors, of your death and will pay all debts of the deceased before distributing what’s left of the estate to beneficiaries.
- Have a will created and executed with an estate planning attorney. Although it might seem unpleasant planning for your death, if you fail to do so, the court will do it for you. A will guides the process and provides clear instructions for your executor. Without a will, the judge appoints an administrator to your estate and decides who gets what based on state law.
- Create a living trust. This document is not subject to the probate process, is private, is controlled entirely by the family and can be resolved very quickly. Probate can run from nine months to two years, and it could go as long as ten years if there’s a contested will. The probate process is also public. Anyone can discover the value of your estate and how it was distributed at the courthouse.
- Joint ownership. Typically, if there’s more than one name on the title, the property is deemed to be jointly held, especially if the magic words “joint tenants with rights of survivorship” are used. As a result, the probate process is avoided as long as there is a surviving joint owner. This property is automatically transferred to the other owner.
- Pay-on-death (POD) accounts. This is as simple as completing a form on your retirement account or regular bank accounts, designating the beneficiary who is to inherits the account. Upon your death, the money is automatically transferred to the named beneficiary.
To fully understand your situation and attempt to prevent family discord, start by meeting with an estate planning attorney.
Reference: Huffington Post (July 11, 2016) “5 Ways to Plan Your Estate”