Top Myths About Estate Planning
Not many of us want to think about what will happen when we die. That time could come tomorrow, a decade from now, or maybe 50 years into the future. We never know, so we try to live our lives to the fullest.
However, we still need to plan for our death. This means working with a lawyer to create the necessary estate planning documents. Estate planning can be a complicated process, though, and you likely have heard myths about what you need and what you don’t need.
That’s why you need to separate fact from fiction. What’s true and what’s not? Here are some myths to keep in mind.
A Will or Trust Will Help You Avoid Probate
Having a will or trust does not dictate whether or not you can avoid probate. It will depend on how you title the assets. Even if you have a trust, if your assets are titled in your name, you will still need to go through probate. You either need to title the assets so that they are owned by the trust or declare ownership of the assets such as ‘When I die, this goes to …’”
A Trust is the Only Way to Avoid Probate
With that said, there are other ways to avoid probate without paying for a trust. You can use transfer on death affidavits and have beneficiary designations for individual accounts. You can also opt to give away assets before you die.
A Will Can Be Used for All Assets
Not all assets can be controlled by a will. For example, life insurance policies, IRAs, and retirement accounts need beneficiaries. So do annuities, payable on death accounts, and transfer on death accounts. The beneficiary form for these accounts will determine who inherits them in the event of your death, so make sure they are up to date. If you have recently married, divorced, or experienced a death in your family, you want to make sure your beneficiaries are current.
Beneficiary Forms Will Help You Avoid Probate
Beneficiary forms for life insurance and retirement accounts can be helpful to some degree, but sometimes issues arise. For example, what happens to the assets if the beneficiary dies before you do? If they have minor children, will they be able to inherit? If the beneficiary divorces, is the ex-spouse entitled to your assets? These are issues you may want to discuss with your lawyer.
All You Need is a Will or Trust
Estate planning involves more than just a will or trust. Talk to your lawyer about other documents as well, such as a financial power of attorney, a health care power of attorney, and a living will.
Seek Legal Help
It’s important to understand the do’s and don’ts of estate planning so that you can avoid common mistakes.
Fort Lauderdale probate litigation lawyer Edward J. Jennings, P.A. understands the estate planning process and can help you differentiate between myth and fact. Schedule a consultation to learn more. Call 954-764-4330 or fill out the online form.