Will

5 Reasons To Create A Will

June 26, 2023 By Gratia P. Schoemakers, Esq.

A will is a legal document allowing individuals to dictate how their assets will be distributed after their death. While many people believe that a will is only necessary for the wealthy or those with complex estates, the truth is that everyone should have a will in place. In this blog post, we will discuss the importance of having a will and why it is essential for everyone, regardless of their financial situation.

1. Control over distribution of assets

One of the most significant advantages of having a will is that it allows you to have control over the distribution of your assets. Without a will, your estate will be distributed according to the laws of intestacy, which may not align with your wishes. With a will, you can specify who will receive your property, how it will be divided, and when it will be distributed.

2. Avoiding family disputes

In the absence of a will, family members may disagree about how your assets should be distributed. This can lead to lengthy and expensive legal battles, which can strain relationships and cause irreparable damage. Having a will in place can help avoid these disputes by providing clear instructions on how your assets should be divided.

3. Naming a guardian for children

If you have minor children, a will is especially important. Without a will, the court will decide who will become the legal guardian of your children if both parents die. By creating a will, you can name a guardian for your children and ensure that they will be cared for by someone you trust.

4. Minimizing estate taxes

Another advantage of having a will is that it can help minimize estate taxes. By using specific strategies in your will, such as creating a trust, you can reduce the tax burden on your estate and ensure that more of your assets are passed on to your heirs.

5. Peace of mind

Finally, having a will can provide peace of mind. There is value in knowing that your assets will be distributed according to your wishes and that your loved ones will be taken care of. People who have created their will have indicated that it gave them a sense of security and reduced stress.

In conclusion, a will is an essential document that everyone should have in place. It allows you to control the distribution of your assets, avoid family disputes, name a guardian for children, minimize estate taxes, and provides peace of mind. If you do not have a will, it is important to consult with an experienced estate planning attorney to ensure that your wishes are carried out after your death.

Did Whitney Houston Leave Too Much Money To Bobbi Kristina?

March 20, 2023 By Gratia P. Schoemakers, Esq. Leave a Comment

Whitney Houston’s estate was worth approximately $20 million when she died – plenty to meet the needs of her only daughter – Bobbi Kristina. Sadly, only a few years after Houston’s death, Bobbi Kristina died as well.

Although Bobbi Kristina’s previous boyfriend, Nick Gordon, is still a suspect in her murder, many say that having access to so much money at a young age was a contributing factor. Sadly, Houston’s estate planning mistakes are all too common.

**Aunt & Grandmother Say Will Did Not Depict Houston’s Intentions**

Houston’s aunt and grandmother filed a lawsuit to re-write the will as they say it didn’t accurately depict what Whitney really wanted for Bobbi-Kristina. They claimed that she was too young to handle so much money.

Although they likely had the best of intentions, probate courts must follow the terms of the actual will or trust documents, not what the person who died might have otherwise intended.

Whitney Houston’s will was created in 1993, specifying that a trust would be created after she died for any children she may have (so before Bobbi-Kristina was even born). Unfortunately, she never updated her will before she died.

Inheriting Money at a Young Age is Never a Good Idea

Whether this tragedy could have been adverted if Bobbi Kristina’s distributions were delayed until she was older is anyone’s guess. The bottom line is that inheriting large sums of money at a young age is generally never a good idea. Although the young beneficiary might be responsible, young people can be easily manipulated by others.

While it’s clear that Houston could have better protected that money with a stronger estate plan, she’s certainly not the only one guilty of not following through. In fact, many of us have the best intentions, but simply don’t make the time to create – and update – proper estate planning documents that can help beneficiaries.

Set Your Beneficiaries Up For Success!

You do have the power to set your young beneficiaries up for success. In most cases, that means creating a trust that allows them access to money over time and can be managed by someone you trust and has their best interests at heart.

We can provide you with the tools you need to protect your loved ones – whatever your situation may be. As Houston’s case shows, ignoring estate planning issues can have tragic consequences. Call or contact us today and let’s get started protecting you and those you love.

Wills, Trusts & Dying Intestate: How They Differ

August 16, 2022 By Gratia P. Schoemakers, Esq. Leave a Comment

Most people understand that having some sort of an estate plan is, as Martha Stewart would say, a “good thing.” However, many of us don’t take the steps to get that estate plan in place because we don’t understand the nuances between wills and trusts – and dying without either.

Here’s what will generally happen if you die, intestate (without a will or trust), with a will, and with a trust. For this example, we’re assuming you have children, but no spouse:

1. Intestate. If you should die intestate, your estate will go through probate and all the world will know what you owned, what you owed, and who got what. Your mortgage company, car loan company, and credit card companies will all seek payment on balances you owed at the time of your death.

After that, state law will decide who gets what and when.

For example, if your only heirs are your children and you have not provided any instructions, state law will mandate divvying up proceeds equally.
Your older children will get their shares immediately if they’ve attained adulthood.
But the court will appoint a guardian to manage the money for your minor children until they become adults.
Shockingly, that guardian can charge a lot of money and be a total stranger – as can the guardian who raises your child.
Yes, if you die without a valid will, the court, not you, will decide who raises your minor children.

Keep in mind that since your death has been published to alert valid creditors, it’s not uncommon for predators (fake creditors) to come forth and make demands for payment – even if they’re not owed anything.

The bottom line? Dying intestate allows state law and the court to make all the decisions on your behalf – regardless of what your intent might have been. Publicity is guaranteed.

2. Will. If you should die with a valid will, your assets will still go through the probate process. However, after creditors have been satisfied, the remaining assets go to whom you’ve identified in your will.

So, if you want to leave money to your children and name a guardian for the minor ones, the court will usually abide by your wishes.
The same holds true if you specified that you wanted to give assets to a charity, your Aunt Betty, or your neighbor.
Keep in mind that predatory creditors are still an issue as your death has been publicized. Even with a will, probate is a public process.

The bottom line? While a court oversees the process, having a will allows you to tell the court exactly how you want your estate to be handled. But a public probate is still guaranteed.

3. Trust. If you’ve created a trust, you’ve taken control of your estate plan and your assets. Trust assets are not subject to the probate process and one of the most important benefits of trusts is that they are private. Notices are not published, so you avoid predators coming after your estate.

You’ll have named a trustee to manage your estate with specific instructions on how your assets should be dispersed and when.

One word of caution – trusts must be funded in order to bypass probate.
Funding means that your assets have been re-titled in the name of your trust.
Think of your trust as a bushel basket. You must put the apples into the basket as you must put your assets into the trust for either to have value.

You do still need a will to pour any assets inadvertently or intentionally left out of your trust and to name guardians for minor children.

The bottom line? Trusts allow you to maintain control of your assets through your chosen trustee, avoid probate, and leave specific instructions so that your children are taken care of – without receiving a lump sum of money at an age where they are more likely to squander it or have it seized from them.

Don’t let the will versus trust controversy slow you down. Call or contact the office today; we’ll put together an estate plan that works for you and your family whether it be a will, trust, or both.

Wills vs. Trusts: A Quick & Simple Reference Guide

July 5, 2022 By Gratia P. Schoemakers, Esq. Leave a Comment

Confused about the differences between wills and trusts? If so, you’re not alone. While it’s always wise to contact experts like us, it’s also important to understand the basics. Here’s a quick and simple reference guide:

What Revocable Living Trusts Can Do – That Wills Can’t

Avoid a conservatorship and guardianship. A revocable living trust allows you to authorize your spouse, partner, child, or other trusted person to manage your assets should you become incapacitated and unable to manage your own affairs. Wills only become effective when you die, so they are useless in avoiding conservatorship and guardianship proceedings during your life.

Bypass probate. Property in a revocable living trust does not pass-through probate. Property that passes using a will guarantees probate. The probate process, designed to wrap up a person’s affairs after satisfying outstanding debts, is public and can be costly and time consuming – sometimes taking years to resolve.
Maintain privacy after death. Wills are public documents; trusts are not. Anyone, including nosey neighbors, predators, and unscrupulous “charities” can discover the details of your estate if you have a will. Trusts allow you to maintain your family’s privacy after death.
Protect you from court challenges. Although court challenges to wills and trusts occur, attacking a trust is generally much harder than attacking a will because trust provisions are not made public.

What Wills Can Do – That Revocable Living Trusts Can’t

Name guardians for children. Only a will – not a living trust or any other type of document – can be used to name guardians to care for minor children.
Specify an executor or personal representative. Wills allow you to name an executor or personal representative – someone who will take responsibility to wrap up your estate after you die. This typically involves working with the probate court, protecting assets, paying your debts, and distributing what remains to beneficiaries. But, if there are no assets in your probate estate (because you have a fully funded revocable trust), this feature is not necessarily useful.

What Both Wills & Trusts Can Do:

Allow revisions to your document. Both wills and trusts can be revised whenever your intentions or circumstances change so long as you have the legal capacity to execute them.

WARNING: There is such as a thing as irrevocable trusts, which can only be changed under certain circumstances, using very specific methods.

Name beneficiaries. Both wills and trusts are vehicles which allow you to name beneficiaries for your assets.
Wills simply describe assets and proclaim who gets what. Only assets in your individual name will be controlled by a will.
While trusts act similarly, you must go one step further and “transfer” the property into the trust – commonly referred to as “funding.” Only assets in the name of your trust will be controlled by your trust.
Provide asset protection. Trusts, and less commonly, wills, can be crafted to include protective sub-trusts which allow your beneficiaries access but keep the assets from being seized by their creditors such as divorcing spouses, car accident litigants, bankruptcy trustees, and business failure.

While some of the differences between wills and trusts are subtle; others are not. Together, we’ll take a look at your goals as well as your financial and family situation and design an estate plan tailored to your needs. Call or contact us today and let’s get started.

Parental Warning: If You Own Your Property This Way, You May Accidentally Disinherit Your Own Children

March 8, 2019 By Gratia P. Schoemakers, Esq.

Owning property as Joint Tenants with Right of Survivorship is easy, common, and often disastrous. Sadly, children – both minor and adult – are often disinherited.

While there are several forms of joint ownership, the one most people use (and the one considered in this discussion) is called “Joint Ownership with Right of Survivorship.” When one owner dies, the jointly owned asset automatically, by operation of law, transfers to the surviving owner.

Joint ownership is a very common way for married people to own their assets.
Joint ownership is also commonly used by aging parents and their adult children.

Joint Ownership Just Postpones Probate

In most cases, joint ownership merely postpones probate; it doesn’t totally avoid it. If the surviving owner does not add a new joint owner (or place the asset in trust) before she dies, the asset will have to go through probate before it can go to the heirs. Or, if the owners die at the same time, probate is required immediately.

Joint Ownership Can Cause You to Unintentionally Disinherit Your Beloved Children

Surprising to most parents, assets titled as “Joint Tenants with Right of Survivorship” are NOT controlled by their Will or Trust. In fact, if you are the first owner to die, you can’t control what happens to that asset.

If you add a spouse who is not the parent of all of your children as a joint owner, you will disinherit your children from a previous relationship.
If you add one child as a joint owner, you will disinherit your other children.

The transfer of ownership takes place immediately upon your death. Even if your Will or Trust directs that you want someone in particular to receive your share of a jointly owned asset, it will still go to the surviving owner. The surviving owner can then do whatever he or she wants with the entire asset.

Here’s an example:

After Robert died, Joan owned their vacation home outright. She remarried a few years later, and she added her new spouse’s name to the title. When Joan died, her children were shocked to learn that the new husband now owned the property, even though their father had always promised it would stay in the family and go to the three of them.

Other Risks of Joint Ownership

While it’s easy to add a co-owner’s name to a title, taking someone’s name off a title can be difficult. If the person does not agree, you could end up in court.
Your assets are exposed to the other owner’s debt and obligations. For example, if you add your adult son on the title of your home and he is successfully sued, you could be forced to sell your home.
There could be serious gift and/or income tax consequences.
If you add a minor as a joint owner, the only way to sell or refinance the asset is through a court guardianship.
If you need to sell or refinance and your co-owner is incapacitated and unable to conduct business, you’ll have to ask the court to appoint someone to sign for your co-owner (even if that co-owner is your spouse). Once the court gets involved, it usually stays involved to protect the incapacitated owner’s interest until the incapacity ends or the person dies.

Actions to Consider

To avoid both inconvenience and tragedy, call our office immediately to set up an appointment and have your asset ownership reviewed.
We will review your asset ownership and explain what will happen to your assets if you become disabled and when you die.
We will show you how to own your assets to best ensure your estate plan works, meaning it does what you think it’s going to do.

Joint ownership with a sibling, life partner, business partner, child, spouse, or anyone else, puts your assets and your children’s inheritance at risk. It may cause significant and unnecessary taxes and cause your estate plan to fail. To avoid both inconvenience and tragedy, you are invited to call our office right now.

What Estate Planning Awareness Means For You

October 15, 2018 By Gratia P. Schoemakers, Esq.

The third week of October is National Estate Planning Awareness Week (Oct. 15-21, 2018). Estate planning is important for everyone regardless of wealth or family status because if you become incapacity or pass away without an estate plan, you are leaving the distribution of your assets subject to state law – and the results may not be what you want or expect.

Estate Planning Explained

Estate planning includes the growth, protection, and transfer of a person’s wealth through the creation and maintenance of an estate plan. The concept of estate planning is important and twofold: (1) to have a strategy that will maintain your financial security during your lifetime, and (2) to ensure that your intended transfer of property and assets occurs upon your death. Both of these issues are analyzed through the lens of the unique situation of the family and the possible expense of different methods used in the estate plan.

Benefits of Estate Planning

There are several benefits to having an estate plan. At a minimum, an estate plan provides clear written guidance to your loved ones on what to do with your assets when you are deceased. But perhaps the most important reason is to be in control of how your family is provided for in the event of your death or incapacity. Estate planning can address several issues including:

Who will raise your minor children,
Who will inherit your assets and how they will be distributed,
Who will care for loved ones who are unable to care for themselves,
Who will care for your pets, and
Who will receive your life insurance and other insurance proceeds.

Finally, good estate planning can ease the time-consuming, administrative strain placed on your family during an already difficult time.

Estate Planning Statistics

According to studies^[1], 6 in 10 adults have not put a will in place. And, while many have likely heard that it is wise to avoid probate – the legal process by which the assets of a deceased are disposed of under court supervision – many do not understand why probate should be avoided. Three main issues with probate include: (1) the tying up of the decedent’s assets for months or even years while the probate is open, (2) the cost, sometimes as much as 5 percent of the estate’s value is spent on attorney and court fees alone, and (3) the loss of privacy in the probate process when it comes to the decedent’s financial information.

There are many financial and legal tools that may be used in the estate planning process. Contact us today to discuss your situation and learn about your specific options.

^[1] https://www.aarp.org/money/investing/info-2017/half-of-adults-do-not-have-wills.html