Estate Planning Tips To Keep Your Money With Your Loved Ones

In managing your estate and keeping wealth in the family, it’s easy for things to go wrong. This is especially the case if the correct documentation is not in place or your desires are not clearly outlined in these documents. Luckily, this is avoidable so long as you give your estate plan proper attention.

By applying these estate planning tips to your unique situation you can remove worry, gain confidence, and keep your money with your loved ones long after your death.

Know the Difference Between a Will and a Trust
A fair amount of people cannot easily differentiate a will from a living trust. When managing their assets, they may not have the best solution for them in place. Knowing the difference between a will and a trust allows an individual to make the best decision for their estate so that their wealth is both accessible and easily distributed based on their exact wishes.

A will is a document that outlines what should happen with your assets after you pass. It also includes critical details such as your appointed executor, who will become the guardian of your children, how you’d like outstanding debts and taxes to be paid, and from what financial accounts both will be paid from.

With a will in place after your death, the executor can then pay any debts or taxes that remain in your name and distribute your assets to the listed beneficiaries.

A trust, although similar to a will, appoints a trustee to manage and distribute your property instead. Essentially, the trustee takes the place of the executor in interfacing with probate courts. This means that any property listed in a trust does not go through probate court, saving your loved one’s time and money.

A trust is a great option if you have a sizable estate or are concerned your beneficiaries won’t be wise with their inherited money. A living trust allows you to create certain stipulations, providing you with more control over your wealth. To prevent your property from entering probate court, and to clearly define conditions as to how you’d like your assets distributed, a living trust is a better option than that of a will.

Keep Your Designated Beneficiaries Up to Date
A beneficiary is someone you’ve named in your will or living trust and is the recipient of certain assets after your death. Assets a beneficiary may inherit vary; a specific financial amount,

property such as your home, car, or collectibles, or the funds stored in your retirement, checking, and/or savings accounts.

Unusual inheritances can be found in old family wills

I’ve been working on some wills this week, attempting to sort out one of those family lines in which the same given names appear over and over and over.

In this case, only four generations of my direct line there are four Johns, three Thomases, and three Anns — and that doesn’t count any of the nieces and nephews. And dates don’t help much; at any given time there could be two or even three Jacobs in the same county.

So wills, even if they don’t actually mention names of widows and daughters, can be of assistance. Sometimes the probate files of intestate estates are even more helpful. If a person dies without having written a will, the estate must be inventoried and divided, with all the heirs signing off on their settlements. That includes daughters, including married ones. Even with a will, a probate file is generated, and they usually include all the receipts for things charged to the estate.

An important term that you need to know when researching wills or probate files is dower. Dower refers to the legally established percentage of an estate that the widow is entitled to. (It’s not to be confused with dowry, the money that a woman brings to the marriage.) How much she is entitled to depends — like most everything — on when and where the family lived. Laws vary from time to time and place to place.

In most of the wills I have been reading, the phrase “in lieu of her dower” is included. That means Granddaddy is most likely leaving Granny property worth more than the dower.

It’s possible that when you had to read a Shakespeare play in high school (and don’t tell me you didn’t), at some point Shakespeare’s will was mentioned. You know, that will in which he left his wife his “second-best bed.” Well, my ancestors left wills that sound as strange to a modern ear as that bed.

There is one in which the testator left his wife “the full priviledge and intire use of the two Rooms in the East end of my dwelling house… and the sellar underneath the same[,] the Kitchen & oven” and so on. [original spelling]

Wills also offer an insight into the economics of the period. In 1770 a female ancestor left each one of her three daughters a “worsted gown.” Another daughter received her best quilted petticoat along with the gown; another got “half a length of black silk.” Can you imagine naming your best dresses in your will?

Is A Trust Necessary?

Question: Some friends, who I’m sure are far wealthier than I, suggested creating a trust document for my assets. How do I know if this is appropriate for me?

Answer: Many high-net-worth people create trusts to help with estate and tax planning, yet there are other reasons for a trust. Trusts can be used to help retain control and management of assets in the event of disability, protect estate assets from creditors, maximize philanthropic giving, and avoid probate.

The 2017 Tax and Job Acts increased the exemption amounts for estate, gift and generation-skipping for tax purposes from $5 million to $11.8 million; in 2022 this increased to $12.06 million. With proper planning, the bill allows couples to have a combined gift and estate tax exemption amount of about $24.12 million to pass on free of federal estate taxes upon their death. Anything above that amount may be subject to a 40% tax rate. Since most of the population doesn’t fall into this high-net-worth category, let’s look at other reasons why establishing a trust might be beneficial.

A living or revocable trust can be used to retain control of your assets. As the trustee, you map out your inheritance plan and can make changes during your lifetime. At your passing, the trust cannot be changed and eliminates the possibility of undue influence from children, stepchildren, current or past spouses, and any external parties. Another reason for a trust is if there are young children or adults not yet ready to assume financial responsibility, a trust can ensure assets are not mismanaged or recklessly lost. Think of a trust as an umbrella of protection for assets to be controlled by a trustee of your choosing, rather than by your beneficiary, who may be influenced by others.

Protecting assets from creditors, divorce, litigation, and malpractice are additional scenarios to consider when creating or revisiting your estate plan. Asset protection planning discussions should be considered before they’re needed to protect your assets. Certain types of irrevocable trusts may allow assets to transfer and grow outside of your estate. It’s important to work with an estate planner familiar with tax law to determine if, and what type of trust(s) would be effective in your planning.

Is My Ex-Spouse Entitled to My Inheritance?

If you are divorced, recently separated, or are considering divorce proceedings, you may be wondering if your ex-spouse is entitled to make a claim for any of your inheritance. In this article, we help to put you in the picture as to what you can expect in a number of instances related to divorce and inheritance.

Read on to see how things could affect you.

When inheritance is received during or before the marriage
If you received an inheritance before you were married and your ex-husband or wife benefitted from it, then it’s possible that your ex can make a claim on it. In cases where your inheritance was received during the marriage, inheritance can often be classed as ‘joint property’ or as a benefit to the family unit and your ex could therefore make a claim on it.

Probate Funding: A Useful Option for So Many

Why is Probate Funding Needed?
Probate Funding is growing in importance due to the increasing percentage of the population (i.e. baby boomers) who die annually and have their Estates and/or Trusts go through probate administration. In theory, the process of distributing a Decedent’s estate should not be complicated. But in practice, administration is rarely quick and easy. Even simple or uncontested Probate administrations take no less than eight (8) months to a year to finalize, while the vast majority of administrations of Probate or Trust Estates take much longer.
Due to funding and short staffing issues, many Courts set hearings months out even on uncontested petitions. Quite often, because of questions relating to the admissibility of a Will, the location of intestate heirs, and/or questions

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