Questions & Answers about Estate Planning
By Barbara Boone McGinnis, CELA
How do I keep my heirs from having to go through probate?
Probate is the legal process for transferring your assets to your heirs, based on the law in the state where you live. Probate calls for public notice to creditors and distribution of assets to heirs after all creditors are paid. Many people want to avoid probate for their family members if possible to avoid the long process and extra legal fees. To avoid probate you must proactively plan to avoid it. One of the best ways to avoid probate is by putting assets in what’s called a revocable living trust.
Are there any downsides to having a revocable living trust?
One of the most significant downsides to a revocable living trust is the follow-through effort required to transfer title of assets to a trust. It can be rather time consuming.
Do I need a trust for my estate plan?
What drives the need for a trust is the level of control you want to maintain over your assets. A trust provides flexibility with the control that a simple will might not. A trust is a legal arrangement in which one person’s property on money is entrusted to a third party to handle that property or funds on behalf of a named beneficiary.
Do I need a lawyer for a last will and testament or can I do it myself with an online form?
Well, the short answer is “no” you don’t have to have an attorney but you should hire one. The advice of counsel can be invaluable depending on the circumstances of your life and complexities of your estate. Whether you draft a will yourself or hire an attorney, be sure to keep your will current and make sure your executor knows where the most current version is stored.
How do I choose an executor?
The executor is the person with the legal responsibility to ensure that your wishes for your estate are carried out, that assets transfer properly and that any bills, debts, and taxes get paid. Look for someone who is trustworthy and competent to carry through your wishes.
Do I inherit my parent’s debt?
Usually not. When your parent dies, his or her estate will be responsible for paying any debts. If the parents don’t have enough money to pay debts, you will have to sell personal possessions or property to pay off creditors with proceeds. An exception that would make you legally responsible for your parents debt after they pass away would be if you were a joint holder on a credit card account or if you co-signed a loan with him/her.