Tag Archives: Estate Planning

Can it happen here?

A recent story from the United Kingdom talked about the rise of family feuds related to inheritance. The number of cases – 116 – reaching the High Court in 2015 broke all past records.

According to a British law firm, the rise in cases is due to the “intricacies of modern family life and rising property prices.” This increased complexity means that there is a larger pool of potential claimants for every estate. There is a big risk that someone will feel left out and bring a claim.

In addition, people living together outside of marriage may be left out in the cold if their significant other dies without a will. The estate will most likely go to their blood relatives, not to their partner. A claim might be the only way to possibly address this issue.

Furthermore, people may marry more than once and if there are children or stepchildren involved, there’s a good chance that someone will feel wronged. A spouse may intend for their own blood children to inherit their assets, but they die first and, eventually, everything goes to surviving spouse’s children. The blood children of the first to go spouse get nothing.

One famous British case involved an estranged daughter who successfully battled her mother’s decision to leave money to animal charities. In the end, she received about one third of her mother’s estate.

Can this type of inheritance feud happen in the United States? Absolutely. If you don’t want it to happen to you or your loved ones, make sure you have a will and have clearly, legally documented your wishes while you’re still alive to do so.

For more information about planning for the end of your life, check out our website www.diesmart.com.

What’s a big problem in China? No wills!

It’s only been in the last 30 years that China has allowed people to accumulate wealth. Prior to that, it really didn’t matter. There was no private property to pass along to a descendant so a will was not needed.

Now, some of the first generation to benefit from the ability to accumulate wealth are dying and it’s causing a huge problem with inheritance disputes that are taking up the time of the courts and causing rifts between family members.

We came across a story in USA Today that illustrated the problem and explained what the Chinese government is trying to do to fix it.

“When people die without a will their children scramble for their property, damaging family ties and having a negative effect on society,” the state-run Xinhua News Agency has warned.

“Only 1% of China’s 220 million seniors have drawn up inheritance plans, according to best estimates. The reason is cultural: talking about death is taboo and writing a will is akin to putting a curse on yourself.”

“Consider the publicized case of Yan Jiying, a coal baron from the northern province of Shanxi. He died in 2015 at the age of 71, leaving his estranged wife, long-term mistress and six children to fight over his assets.”

“The government is calling on local authorities around the country to establish free legal centers for those over 60. One charity doing that since 2013 is the China Will Registration Center, founded by Chen Kai, a young lawyer with a passion to protect seniors. “

“ The waiting list for appointments at his first Beijing center now stretches into September, proof that people will write a will if they can find support they trust, Chen said. “We want to teach old people that they are the masters of their fortune, that they have the right to decide what happens to their hard-earned money, ” he said.”

“On a recent morning around a dozen seniors were squeezed around a communal table at the center, diligently transcribing the final copy of their will. They begin by dictating their wishes to a lawyer, who types up a draft. The clients are then evaluated by a visiting psychiatrist to establish clarity of mind, they record video testimony of their wishes in the presence of two independent witnesses, and finally copy the final document by hand.”

“For many, the last step is the hardest. Most are over 70 and have shaky hands or poor eyesight. Transcribing a page of formal Chinese characters mistake-free is no easy task. But Chen is adamant that they do it this way, saying he has seen too many badly written wills challenged. He wants his clients to be sure their wishes will be respected even if some family members do not like them.”

Although the percentage of people in the United States having wills is much higher than 1%, it’s still below 50%. If you don’t have a will, you should consider preparing one so that your family won’t have to deal with issues related to your estate once you’re gone. To find out more about preparing a will and other estate planning steps, check out our website http://www.diesmart.com.

You don’t think you’ve been treated fairly by a deceased relative?

If someone in your family has died and you don’t think you’ve been treated fairly, what’s the first thought that comes into your head? Challenge the will. But you might want to think a second time before doing this. A will contest is very hard to win. It’s difficult to prove that someone was incompetent after they’ve died and it’s equally as tough to prove that undue influence was exerted on the deceased. Finally, some wills have a clause that will cause you to forfeit your inheritance if you challenge that will. So it might be best to just accept whatever has been left to you and then to get on with your life.

We found a blog that gave a great example of what might happen if you challenge someone’s will.

“Sam and Erica were married. It was Erica’s first marriage and Sam’s second, his first marriage ending in divorce. Sam had one child, Jason, from his first marriage. Erica did not have any children. They each had identical wills, leaving their entire estate to the other, and on the death of the survivor everything goes to Jason.

Their wills also contained a provision, requiring the surviving spouse to live at least six months after the first spouse’s death. If the survivor did not live that long, he or she would be treated as having predeceased the first spouse.

In March of 2015, Sam died. Erica filed a probate proceeding in May and submitted Sam’s will to the court. Because she filed just two months after Sam’s death, Jason objected. He argued that she had no authority to take over Sam’s estate because she had failed to survive him by six months.

Erica apparently became angry, and revoked her own will to make sure that Jason did not receive any share of her estate. Erica signed a new will a few months later (well after she had reached the six-month survivorship requirement). She left her entire estate to her sister and nothing to Jason. She died five months later.

Jason contested her new will, arguing that she had been subjected to undue influence by her sister in preparing her new will. The probate court dismissed his complaint and upheld Erica’s will. Not satisfied, Jason appealed.

The higher court affirmed the probate court finding and stated that it was clear that no one influenced her in her decision to revoke the earlier will or to do her new will. Once she revoked the earlier will, she was intestate — that is, she had no will at all — and since Jason was not her child, he would have no right to any share of her estate if she had died without a will.

Why would that make a difference? Because if she had no will prior to signing the new will, Jason had no standing to even challenge that will. According to the appellate court, there was no question that Erica had revoked her earlier will a few months prior to her executing a new will and thus Jason’s objections were dismissed.

What might Jason have done differently? Hindsight is always 20/20. Perhaps Jason should not have objected to his father’s estate when he did. If Erica had actually died in the four months after he raised his objection, he could probably have still made his legal point. In the meantime, he clearly offended her to the point that she changed her estate plan.”

Moral of the story: Think about what might happen if you challenge someone’s will. It might be better to accept what’s been left to you than taking a chance that you might end up with nothing.

For more information about estate planning, check out www.diesmart.com
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When is online estate planning a good idea?

First of all, what is estate planning? It’s the process people follow to protect their estate and their family in case of their incapacitation or death. It includes such things as writing a will, naming a guardian for an surviving minors in the family, creating trust accounts, naming an executor for the estate and setting up a durable power of attorney.

Traditional estate planning can be quite expensive and many people can’t afford it so they are turning to an online option – the virtual legal service. For example, a traditionally written will can cost between $500 and $1,000 to prepare. An online version can be done for an average of $60, a much more affordable choice.

Here are three questions to ask yourself before you decide whether the online option is a good choice for you.

Do I have a simple situation?
If you don’t have any minor children and your estate is relatively small, you probably could use an online service such as Rocket Lawyer.
How big is my estate?
If you have assets and insurance in excess of the current estate tax exemption ($5.45 million per individual in 2016) the online option probably is not for you. You would do better to work with an estate planning professional who will help you evaluate the ways you can leave money to your beneficiaries while minimizing estate taxes. This could include setting up a trust that would minimize taxes and avoid probate.
Do I need expert legal advice?
Even with a small estate, you may have special circumstances that require expert legal advice. For example, if you are part of a blended family, own property outside of your state or have a disabled family member, online planning may not be for you. You may need to speak with an attorney to discuss your specific needs and to work with that expert to create a plan that meets your needs.Although online estate planning is a good choice for many, make sure you consider your current situation, the size of your estate and your other circumstances. Then decide whether hiring an estate planning attorney is the best option for you or whether you can comfortably go the online route.

For more information about estate planning, check out our website www.diesmart.com.

Do I Really Need a Will?

Yes, you do. A will is a legal document which ensures that your property is transferred according to your wishes after your death.

If you don’t have a will, here are five things that can happen. We found this list at nerdwallet.com.

Spendthrift heirs – If you have heirs who aren’t equipped to handle a large sum of money, receiving it may cause damage. Perhaps these heirs are bad at handling money or, maybe, they’re drug or alcohol addicts.
Unexpected or contested heirs – There may be confusion about who the beneficiaries really are. Sonny Bono, musician and politician, died without a will. His ex-wife, Cher, and a man who said he was Bono’s son tried to claim part of his estate, which his wife, Mary, contested in court. Prince’s estate is another classic example. Many people came out of the woodwork claiming to be relatives, entitled to a piece of his assets.
Property (and probate) in multiple states – If you own property in more than one state, your estate will have to go thru the probate process more than one. Probate is a costly and timely process, even if you just go through it once. Image if you own property in four states and your heirs have to hire four attorneys and go through the whole process four times.
Fabricated wills – If you don’t have a real will in place, it’s possible for someone to create a fake one – especially if your estate is large. A famous case involved the estate of tycoon Howard Hughes. When he died, several supposed wills surfaced, and his estate spent millions of dollars defending against the false documents.
Beneficiaries don’t like the court appointed executor – If there’s no will, the probate court will appoint one. It may likely be an experienced attorney but not necessarily one the family knows. It may take a great deal of time for this person to take inventory, appraise assets and distribute the estate. If you have a will and name a family member as executor, that person will usually do a much faster job, possibly because that person is also a beneficiary.

If you don’t have a will, you should prepare one now. Otherwise, your assets may not be distributed the way you want them to and a lot of extra money will go to attorneys and the probate court and not to your heirs.

For more information about wills, trusts and other estate planning documents, go to www.diesmart.com.