Planning a will can seem like the simplest way to proceed when you decide to put an estate plan in place. Under very simple circumstances, a will could be an acceptable choice, but you should understand all the facts before you make any final decisions.
In this blog post, we will look at three things that you should think about when you are planning a will.
1.) Beware of do-it-yourself estate planning notions.
There are websites on the Internet that sell generic legal downloads and worksheets that can be used to create last wills. Before you go down this road, you should understand some facts.
In 2012 Consumer Reports engaged three legal professors to examine last wills that were created through the utilization of downloads that were purchased from three different online legal document purveyors. The professors were unimpressed, and in the end, Consumer Reports advised against DIY estate planning.
Plus, a will must be executed in accordance with the laws of the state of New Jersey if it is going to be valid. Since the Surrogate’s Court will evaluate the will to determine its validity, you should probably work with a licensed estate planning attorney when you are planning a will.
2.) You need more than a last will.
If you engage an attorney to create a solidly constructed last will, the work is not done. Without question, making sure that assets are transferred to your loved ones in accordance with your wishes will be job one. However, a comprehensive estate plan will also address potential end-of-life issues.
Doctors can sometimes keep terminal patients alive through the utilization of artificial life-sustaining measures. You could state your wishes regarding the utilization of these techniques if you execute a living will.
To name someone to make medical decisions on your behalf, you could include a health care proxy or durable power of attorney for health care. A durable financial power of attorney can be included to address financial decision-making.
3.) Planning a will may not be the best choice.
There are many different circumstances that would call for the utilization of a trust of some kind. A will is not always the best choice.
For example, you may have a loved one with special needs in your family. Many people with special needs rely on Medicaid as a source of health insurance. Supplemental Security Income is another program that can be essential for people with disabilities.
These programs are only available to people who can demonstrate a significant level of financial need. As a result, if you were to leave a direct inheritance to a benefit recipient in your will, the improvement in financial status could cause a loss of eligibility.
To account for this, you could establish a supplemental needs trust. The trustee that you name in the document would be empowered to use assets in the trust to make the beneficiary more comfortable, but benefit eligibility would not be impacted.
If you were to use a last will to express your final wishes, the inheritors would receive lump sum inheritances all at once. Creditors who held legal judgments would be able to go after these inheritances.
Plus, even if there are no judgments out there, a spendthrift inheritor could squander his or her inheritance far too quickly. Financial hardships could ensue later on.
To prevent this outcome, you could establish a revocable living trust. You would not have to worry about losing control of the assets while you are living, because you could act as the trustee throughout your life.
In the trust declaration, you would name a successor trustee who would manage the trust after you are gone, you would name beneficiaries. You could include a spendthrift provision when you create the trust.
After you die, the trust would become irrevocable. Assets would be protected from the beneficiary’s creditors. Plus, you could instruct the trustee to distribute assets to the beneficiaries on an incremental basis over a period of time. You would not be forced to allow for the distribution of all of the assets in the trust in lump sums.
Schedule a Consultation
As you can see, planning a will is not always going to be the best way to proceed. If you would like to discuss your unique personal situation with a licensed estate planning attorney, our doors are open.
We can become apprised of your estate planning objectives and make the appropriate recommendations. Ultimately, you can craft an estate plan that is perfect for you and your family.
Call us at (908) 222-8803 or send us a message through our contact page to schedule a consultation.
- Medicaid Attorneys Explain How a Pre-Paid Funeral Contract Can Help - March 31, 2021
- What Is a QTIP Trust? - March 25, 2021
- How Would You Feel about a Robot Caregiver in the Future? - March 18, 2021