In many life situations, people take action or fail to act based upon misinformation or false assumptions. This is particularly the case when it comes to more complex financial and estate planning matters. However, individuals and their family members who either fail to take action or take action based upon false information may ultimately end up paying heftily.
Estate planning can be complex and confusing. While most people know about common estate planning tools such as a will and trust, few realize that the use of these and other estate planning vehicles can and should be tailored to meet an individual’s needs and ultimate goals. For these reasons, individuals who plan to either start or make amendments to an estate plan are advised to seek the assistance of an estate planning legal professional.
New York residents have likely heard about estates that have gone through the probate process. In many cases, however, people don't have a clear understanding of why an estate may be subject to the probate process, what the probate process entails and the potential negatives inherent to probate.
While a will is often heralded as the most important and basic of all estate planning documents, it's important to note that a will alone won't accomplish all of an individual's estate planning goals. Additionally, in most cases, a will alone isn't sufficient in preventing an estate from going through probate.
While a will can be useful in expressing an individual’s wishes with regard to whom certain assets and belongings are to be distributed, in some states, an estate may still be required to go through probate court. The probate process can be both costly and lengthy and documents and information submitted to the court become public record. It's preferable, therefore, to take steps to avoid the probate process.
One way to avoid probate is to establish a revocable living trust. Individuals who set up a revocable living trust can be named the trust's trustee and therefore has control over all assets mentioned in the trust. Additionally, amendments to the trust's decrees can be made at any time during an individual’s life.
Taking the time to both establish and update an estate plan can ultimately bring an individual peace of mind. Additionally, a comprehensive estate plan benefits loved ones who are spared the hassle of attempting to navigate the probate process.
Source: TCPalm, "Explaining common misconceptions about wills and trusts," Robert Schwartz, March 5, 2014