When I help clients plan their estate, there are some issues that keep appearing that deserve mention. Here is a list of 10 issues that I want to bring to your attention:
1) A spouse is not legally entitled to act for another spouse simply because they are married to one another.
2) Telling people what you want to happen with your estate is not sufficient. You can tell people what you want all day. That doesn’t make it legally binding.
3) Joint ownership resolves everything. Wrong! Joint tenancy actually creates more problems in many circumstances. If you own property jointly with others, you might want to reconsider.
4) If you’ve ever thought, “Oh, our family gets along very well. We don’t need an estate plan,” this is actually the first sign that everything is going to unravel!
5) If your existing legal documents are 2 or 3 pages long, trouble is on the horizon! It’s not what’s in the documents but what is missing that causes the most trouble.
6) People often think they have a living trust when in fact they have a simple will.
7) A “living will” is not the same as a “living trust.” They are two separate legal documents. If you have a living will, we don’t use those anymore in California.
8) A Living Trust is not a device created to avoid creditors and bankruptcy. A trust might offer some protections for your children, but if you are looking to use a trust to hide assets from creditors, that is not your best bet.
9) If your beneficiaries on life insurance policies and other accounts are minors, you might want to reconsider your approach.
10) Adding your children to real estate and bank accounts so they can inherit those assets from you is a dangerous tactic that most people don’t fully understand. Make sure you are aware of all the downsides before adding anyone to your accounts or real estate.