August 10, 2018










Protect Your Legacy With Three Essential Estate Planning Tools

An estate consists of the personal or real property, possessions, and financial holdings that a person has accumulated during his or her lifetime. Estates do not apply only to the wealthy. One’s estate simply consists of the personal property owned by that individual, regardless of the amount of property. An estate can consist of a modest home and vehicle, bank accounts, business assets, land or any type of property that has monetary value. Most people want to ensure that property remaining after death passes to the heirs of their choosing, and that as little as possible becomes absorbed by estate taxes, fees, and mismanagement. The following are three essential tools for making that happen.

The Last Will and Testament

When a Last Will and Testament (will) is prepared, it contains instructions pertaining to the disbursement of assets by the executor. The will should name who will administer the estate (executor) and should include an alternate. Wills properly prepared by an estate planner will be legal in the state in which they were written and legally binding in a court of law. For families with young children, young people establishing careers, and people with moderate incomes, a will provides sufficient protection. For people with larger holdings and multiple heirs a trust may be more appropriate.

Trusts

A trust does not replace a Last Will and Testament. The difference in a will and a trust is that the guidelines set out in the trust can take immediate effect while the person is still living. The trustee of the trust has the authority to handle the assets as outlined and this authority remains until all of the assets are distributed. A successor trustee serves in the event of the death of the original trustee so that the directives under the trust are still enforced. Because trusts are private, they are not public record. The trustee has full discretionary control. A properly executed trust can save families significant fees expense and provide peace of mind, as the assets are not open to public consumption. It is important to remember to title all assets possible into the name of the trust so that the disbursements go through it as opposed to an estate when the executor dies. Any assets left outside of the trust may be subject to probate.

Insurance

Insurance is one of the most simple and cost effective ways to protect assets. Life insurance names certain beneficiaries that will have direct disbursement at the time of the loved one’s death. These funds do not pass through the probate estate unless the estate is a beneficiary. Life insurance proceeds protect assets by giving the remaining family members a means to pay for burial expenses, unexpected costs, and current living expenses.

The previous estate planning tools will protect assets gained by diligence and achievement, making sure that hard-earned legacies remain protected for generations to come.

Sources:
http://money.cnn.com/retirement/guide/estateplanning_trusts.moneymag/index.htm
http://www.bankrate.com/finance/personal-finance/9-key-estate-planning-tools-1.aspx
http://www.fpanet.org/LifeGoals/PlanningMyEstate/AdditionalEstatePlanningTools/

Preventative Measures to Defend Against Will Contests

The purpose of a will is to be sure that your affairs are handled after your death and that your loved ones are taken care of properly. A will also protects your estate from various forms of litigation, including suits filed by family members who do not agree with the will’s contents. For this reason, it is important to take steps to protect your last will and testament from potential contests after you have died.

Plan Your Estate When You are Young

The best advice regarding estate planning is to begin taking steps when you are young and of sound mind. Even if you don’t have a lot of assets, are single or don’t feel as if there is much to protect, a will makes things much easier for your heirs. In addition, creating your will when you are of sound mind makes it more difficult for someone to claim you were not able to make an informed decision regarding the disposition of your assets.

No Contest Clause

In some states, it is possible to include an in terrorem clause, also known as a “no contest” clause. The in terrorem clause states that if anyone named in your will or irrevocable trust files a lawsuit to challenge the provisions of the document, they receive nothing from the estate. Some states prohibit such a clause, while other states name exceptions to the rule that could make the clause unenforceable. An estate attorney can advise whether this clause is applicable in your state.

Consider Trusts

A revocable living trust is another means of avoiding will contests after your death. Trusts are personal documents that remain private, while a will is a matter of public record. In addition, a revocable trust covers all phases of your life, regardless of health, and can continue even after you pass away. A will only takes effect at the time of your death. If there are family members that you feel may squander their inheritance or create trouble after your death, consider creating a lifetime trust to encourage more responsibility and reduce the chance of litigation.

Discuss your estate plan with family members as well so that there are no surprises after your death. Every few years, review the terms of your will to be sure it still suits your current goals. A pattern of repeatedly reviewing your estate plan will make it much more difficult for a will contest to be successful, as your record will demonstrate that the will is indeed representative of your final wishes.

Sources:
http://www.nolo.com/legal-encyclopedia/estate-planning-when-you-re-young-healthy-childless.html
http://www.bankrate.com/brm/news/pf/20061115_no-contest-clause-a1.asp

5 Reasons to Draft a Will Right Now

Many mistakenly believe that drafting a will is something that only needs to be done by old, retired people who have families and are facing their end of life decisions. There are, however, many reasons to draft a will no matter what age you are. It is really never too early to make your will.

1. Serve Your Family

Unfortunately, death is a sure future for everyone. There is no way to predict exactly when you will be leaving the Earth. If you are a young person, with no children, then a will can help ensure your current possessions go exactly where you want them. It will also ensure that your funeral and burial arrangements are done according to your wishes. Having a will is a great way to help your surviving relatives. Forcing them to guess at what your wishes might be and worry about getting it wrong is simply unnecessary. Making a will serves your family just as much as, if not more than, it serves you.


2. Limit Sibling Rivalry

Inheritance is one of the key reasons to make a will. Remember that the government has already put in place laws controlling the disbursement of assets upon a person’s death. The only way to supersede these laws is with a written will. It is unlikely that the government will be allocating your estate the way you intend. There is also little to keep siblings from suing and arguing in court over matters of inheritance. By clearly stating how things will go in a will, you can eliminate many legal hassles and infighting.

3. Child Care

If you have a minor child, then you probably have a specific person in mind to care for that child if something should happen to you and your spouse. Most states will automatically turn a child over to the next of kin relative or, if none can be found, place them into the foster care system. No non-family member is legally entitled to take the child unless you specifically name that person in your will. Also, if you would prefer a specific family member to be the caretaker, then they must be named.

4. Things in Your Life Have Changed

Change is a part of life. Even if you have drafted a will in the past or didn’t think you needed one, several life changing events can have a huge impact on the handling of your estate after death. These events include marriage, having children, having grandchildren or developing a serious illness. If any of these events have occurred it is very important to make a will or to update your last will.

5. The Family Business

A will also ensures the continued operation of a family business by appointing chief operators and properly handing over the business ownership to another person. Without this, the business may simply cease to exist unless someone takes ownership of their own volition. The law may also default ownership to someone you would rather not have it.

Sources:
http://www.businessinsider.com/why-you-should-make-a-will-2011-12#its-one-of-the-three-most-important-documents-every-adult-should-have-1

What to Look Out for to Make Sure Your Will Won’t Lead to Family Disputes

It is very unusual for a will to be contested. However, if potential beneficiaries and heirs believe that the maker of the will was not of sound mind at the time that the will was constructed, the contents of a will can be challenged. A majority of wills will go through probate court without being contested, but if the will does not meet legal requirements and would-be heirs point this out in probate court, there can be delays that can benefit the person who is contesting. If you want to create a will that meets requirements and will not lead to family disputes, you should be aware of the grounds on which family can contest your will. Here is a basic guide on making a fully legal will, so that your deserving heirs receive what you left them.

Mental State

If a family member wants to contest your will because he or she is not an heir or beneficiary, one of the most common grounds for contesting the contents of the will is that you did not meet the “sound mind” requirement when the will was written. Will makers (testators) must be of sound mind, know what a will does, know that they are making a will, and know how they want their belongings and assets to be distributed. If a person contests the contents of your will, they may say you lacked the mental capacity to distribute your belongings to the appropriate parties. Having a video will may prevent these considerations from being grounds for a challenge to your living testament.

Age

For a will to meet legal requirements set by a probate court, the testator must be 18 years of age or older. The only exception to this rule is when you are emancipated, married, or in the military.

Manipulation and Fraud

In some cases, family members may claim that one or more trustees committed fraud by manipulating the testator when the latter was in a vulnerable position. This is more commonly referred to “undue influence” in probate court.

Understanding What Will Make Your Will Valid

A will does not have to be full of complex legal terms and statements to be valid. The document must fulfill specific state requirements. In most cases, a state will require that the document do the following:

  • State that the document is the will and state the person’s name
  • Include a statement that identifies who will receive property or who will become the guardian of a minor
  • Appoint an executor to carry out the terms of the will

A will can be done in your own handwriting and still be valid as long as it meets each of these requirements. If the will is handwritten, you must sign and date the paper. Having at least two witnesses who were adults at the time the will was written and signed is a good way to prevent a family member from challenging the contents. If the will is notarized, none of the witnesses on the will must appear in court to swear a will is valid when challenged.

The Best Protection Against Disputes Is Good Legal Advice

To prevent family disputes and leave a legacy to deserving heirs, it is best to know your state’s requirements when it comes to settling probate before you construct a will. The firm of elder law attorney Andrew Lamkin serves not just Long Island but all of New York state and can help you understand how New York law applies to your situation. Call Andrew Lamkin’s office today at 516-605-0625 for a free consultation.

Recommended Resources:
http://wills.about.com/od/fiveessentialdocuments/tp/howtocontestawill.htm
http://www.nolo.com/legal-encyclopedia/grounds-challenging-will-30288.html
http://www.aarp.org/money/estate-planning/info-08-2011/contesting-wills.html

How to Help Beneficiaries Avoid Squandering Their Inheritance

Beneficiaries of estates may not be prepared to manage what their parents or others may leave for them after they are deceased. There could be mismanagement of the estate or fights over who receives what after their loved one has died. It is important for will-makers (testators) to help their beneficiaries prepare for their inheritance by placing stipulations on how they can spend the money in their wills. Here is what you need to know about protecting your beneficiaries from themselves.

Testators Should Issue the Money in Payments

To control the flow of money a child receives, parents are advised to set up a trust and determine how the money will flow to the child at each stage of the child’s life. For instance, a parent may decide that one-third may be distributed at the age of 25 and one-third at the age of 30. The rest of the money will be distributed at the age of 35. Parents can even distribute the money on an annual basis if it works for them.

Some parents may opt for an annuity rather than a trust. This contract with the insurance company will obligate the company to make payments to a beneficiary. Annuities pay out on a regular basis for a period of time depending on the how the annuity is arranged.

Testators Can Disinherit a Child

Parents are not obligated to leave anything to an adult child. Children have no right to their parent’s estate if they were intentionally excluded, but there are times when younger children may be awarded a part of the estate if the oversight was not intentional. There should be a clause in your will indicating every child that should receive a portion of the inheritance.

Testators Can Put Stipulations on the Money

If you are not confident about your child’s money management skills, you can put stipulations on the money and how it is distributed and used. You can appoint someone as a trustee that will help your child manage the inheritance. Some parents may ask a friend or relative to be the child’s trustee or even hire a professional trustee. This service requires payment, but it is worth the investment if there is no one trustworthy in your family to take on the responsibility.

A trust can be terminated if the stipulations are violated. For instance, if the child has battled an addiction, the trustee could terminate the trust, and the trust can end at a certain age. Any stipulations you want to set can be determined in the will.

Need More Advice on Protecting the Inheritance of Your Beneficiaries?

You can protect your beneficiaries by planning ahead and making provisions that will prevent them from squandering their inheritance. But it always helps to have legal advice from a lawyer experienced in estate planning, and Andrew Lamkin is just that. His Plainview, New York, law office serves Long Islanders and other New York state residents who are concerned with both providing for and protecting their heirs. Call Andrew Lamkin today at 516-605-0625 for a free consultation.

Related: http://www.nolo.com/legal-encyclopedia/putting-strings-what-you-leave-your-children.html

What a Will Can and Can’t Do

No one likes to think about their own death, but it is important to make sure loved ones are provided for in case it happens. Anyone without a will should give it serious thought. Anyone with a will that needs changes, should do it now.

A legal will is one that the probate or Surrogates court will accept and put into effect. Probate is the process by which an estate is administered. In order for a Court to grant probate, it must be satisfied that the document sets out clearly how any assets are to be divided and that the Will was executed properly. When the court grants probate, an Executor is appointed to properly administer the estate.

A will is still critical to those who do not have much, as there might be personal items such as jewelry, books, or mementos that are to go to specific people. Having a will lays this all out and saves arguments later on. The will also states who you want to serve as executor. This should be the person who you trust will carry out your wishes.

Dying without a will mean a person has died intestate, meaning that State Law will decides who the beneficiaries are.

Examples of what could happen if a person dies without a will are:

  • If a person dies without a spouse or children, but is survived by parents, the parents inherit any assets of the estate.
  • If a person dies and is survived by a spouse, the whole estate goes to the spouse.
  • If a person dies and has a spouse and children, the estate usually gets divided evenly between them.
  • If a person dies and doesn’t have spouse, children or parents, but has brothers and sisters, the estate is divided equally among them.

There are a number of reasons why having a will is a good idea, including:

  • It is one of the only ways to be sure that a person’s belongings, collected over the years, are given to the people the person wants them to. It helps provides security for the person’s family.
  • Having a will transfers a person’s property to their heirs more easily.
  • If a person has minor aged children, a guardian can be named and planning made for their living expenses and education.
  • If a person remarries, a will protects members of both families. A second marriage usually cancels out a will made before the marriage.
  • A former spouse can still inherit because a divorce does not automatically cancel a will. Updating a will regularly can prevent this.