How to avoid a complicated estate settlement
A pervasive myth surrounding the issue of estate settlement is that you have to be old, or rich, to put together a will.
In fact, everyone should have some kind of will or estate plan in place, no matter what age they are and regardless of their financial status. This becomes especially true if you own property, have any assets like savings or stocks, or have children or other dependents.
What happens if I don’t have a will?
In the simplest possible terms, dying without having a valid will creates a complicated situation for your surviving family, spouse, or children.
There are legal plans in place for these situations, and typically your assets and property will go to your spouse, children, or surviving family. However, depending on your relationship with your children, spouse, or other family, this situation can get contentious.
One example of a difficult situation that dying without a will can create: if you verbally promised your house to one of your children, but never made a will to formally leave it to them, there’s no proof of this conversation– and the state might decide that the house is the legal property of another member of your family, or your spouse.
Similarly, if you previously discussed leaving a family heirloom with a specific member of your family but have no formal documentation of this plan, there’s no guarantee that your wishes will be carried out.
What is estate settlement?
Essentially, estate settlement is the process of resolving your affairs in the event of your death. This process includes transferring assets to the correct people and paying taxes that may be due during the process.
This process often involves someone being named as an executor of the estate. An executor is just the person who’s chosen, either by you or by the state, to handle all of the necessary processes to close out the estate by distributing property according to the will, plus paying any taxes or bills that may be outstanding at the time of the deceased person’s death.
What makes this process complicated?
There are two main complications that can arise in an estate settlement.
First, the deceased’s family may dispute the will for a variety of reasons. Second, businesses that the deceased worked with or owed money to may claim that they are entitled to a portion of the estate in repayment for goods or services.
These issues are resolved in probate court, which is a type of court that specifically deals with estate settlement.
While the business side of things is often relatively straightforward, family members disputing a will can get very unpleasant. Emotions are most likely running high, particularly for grieving family members, and things can become personal quickly.
How can I avoid creating a complicated situation for my family?
Although it’s impossible to plan for the exact timing of your death, there are many actions you can take to mitigate the stress that the event may cause for your family.
Is there a particular heirloom that you want to give to one of your children or a close friend? You can give it to them while you’re still alive– this is a surefire way to know that it’s in the right hands, and it’s one less thing that you’ll have to deal with when you create your will.
The most important part of this process is to meet with a lawyer in order to draw up a clear and specific plan for your estate. Having a valid, recent will that’s been put together by a competent and experienced lawyer will make a difficult process easier for everyone involved.It’s never too soon to put together a will. If you’d like to save your family some stress and heartache, give us a call today to get started.