Tag Archives: last will and testament

What is the most important part of estate planning?

When you do your estate planning, you probably think the most important part of this planning is your Living Will or your Last Will and Testament.  They are very important but they are not the most important thing.

I recently read an article by Julie Garber on about.com and she said the most important part is to select the right person to do each of the jobs your estate plan will require.”  After thinking about it, I agree.

When selecting a person to be your healthcare agent or guardian for your minor children or personal representative, be sure that this is a person who has your best interests at heart.  Also, verify that this person has the time as well as the skills to perform the needed tasks.  And, finally, select someone who you think can make wise decisions.

If you have name someone who declines to accept this position, and the backup person you’ve named also declines, a judge will make all of the decisions for you and your family or will find someone who is willing to do so; this person may not be someone you would have chosen and may not do things the way you would have wanted them done.

Think about it carefully and choose wisely.

For more information about estate planning, go to www.diesmart.com.

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A Last Will and Testament

  • If you have a will and become incapacitated, nothing in your will can help manage your assets while you are living.

A Living Trust

  • If you have a living trust, your co-trustee or successor trustee can continue to manage trust assets without a court supervised guardianship.
  • A court supervised guardianship costs money and requires the courts to supervise how someone manages your assets.

A Testamentary Trust

  • A testamentary trust is created after you die.  It does not provide value if you become incapacitated.

Dying Without a Will

WHAT IF YOU DON’T HAVE A WILL OR A LIVING TRUST?

If you die without having created a will or a trust, you are considered to have died intestate.  In this situation, the state has a created a default will for you.  The default will determines who the state appoints to manage your affairs after you die and the default will determines who will inherit your probate assets.

Upon your death the following will occur if you die without a will:

  • A family member will inventory the assets of the deceased and list what the decedent owned and what the decedent owes.
  • The inventory will include a list of all property with a title.  Based upon the method of title, the person taking the inventory will place the assets in either the automatic inheritance bucket, the trust bucket, or the probate bucket.
    • Property with automatic inheritance rights will automatically be transferred to the named beneficiaries.
    • Trust assets will be managed by the designated successor trustee.
    • The remaining probate property will be distributed according to the applicable state law of intestacy.  These are laws which describe who inherits your probate property when you fail to leave a will.
      • Under most state laws of intestacy, the probate assets are divided among a surviving spouse and children of the decedent.  However, if there is no surviving spouse and no surviving children, then the intestate assets are distributed to next of kin.  In most states, stepchildren have no right to inherit.  If there are no surviving relatives, the entire probate estate may go to the state.
  • The inventory will also include a list of all property without a title, i.e., your jewelry, your furniture, cash, art, and your digital assets.  The estate representative will determine how to distribute the personal property to your beneficiaries.
  • An estate representative, sometimes called an administrator or a personal representative, will be appointed by the court to administer your intestate probate estate.  Most state laws contain a preference that a surviving spouse, and then surviving children, be appointed to serve as the administrator of the intestate estate.
  • The estate representative will decide if probate is required and whether the estate needs to follow procedures for a small estate, a surviving spouse, or a normal probate process.
  • The court appointed estate representative has the same responsibility as someone you appoint as an executor in your will or the successor trustee in your living trust, except that they are not guided by a will or a trust; their actions are governed by state laws only.  ibutton: State Intestate Succession Statutes