Many people don’t realize that almost everyone has an estate, regardless of their wealth. Your estate is considered to be everything that you own such as vehicles, furniture, bank accounts and even your clothing and personal items.
Although it’s unpleasant to imagine something happening to us, it is a fact of life that accidents happen and we grow older. What will happen to all of your property and personal possessions in the event something happens to you? Planning the final disposition of your estate is wise whether you are young or old and especially if there are children involved. Estate planning is not difficult and an estate planning lawyer can advise you in all manner of wills and trusts and can make drawing up a will or trust simple and easy.
Estate planning begins when you draw out a will or a living trust. If you do not have one when you die, the laws of your state will govern the distribution of your estate, even if you always wanted your 100-year-old porcelain doll, given to you by your grandmother, to go to your daughter. That classic car you have put a lot of love and care into was always intended to be your son’s car one day, but will it?
In North Carolina, any person 18-years of age and older can make a will or living trust, and that will or trust will be recognized by law.
Whatever debts you owe upon your death, whether it is a car loan or fees owed for personal services, this will come from the assets of your estate. Once your debt has been satisfied, if you do not have a will or trust explicitly stating your final wishes, the courts will determine who in your family gets what. Most states split assets between a surviving spouse and any children.
You may have wanted to split your assets between your two children and a trusted lifelong friend, but without your wishes being known, the court usually distributes assets according to the laws of your state. If you have jointly-owned assets, these may not be controlled by your will. For instance, if you have a 401(k) or life insurance policy where a beneficiary has been named, it may transfer directly to your beneficiary without being heard in probate.
Many families and professionals of all types prefer Revocable Living Trusts as this type of trust prevents the court from controlling your assets in the event you are incapacitated by having an appointed trustee act on your behalf according to your wishes. These trusts can be changed at any time, and the person you appoint as trustee can also change.
With a will, your assets are distributed how you have stated you wish them to be and once the wishes of the will have been performed, that is the end of it. With a living trust. if you have substantial wealth or inheritance, your children can inherit your wealth at whichever age you wish them to inherit, in the meantime, your assets are protected by the trusted person you have appointed. Perhaps you have a loved one who is horrible at managing money and you don’t feel comfortable giving them a lump sum of your estate but you want to provide for them. You can appoint any person or entity as your trustee, and that person can distribute payments to them over a period of time or for the remainder of their lives.
There are many different wills and trusts and aspects to them that are designated by you so that you can provide for your family and loved ones or even show your love and thoughtfulness. A few of the things that estate planning can involve besides providing wealth include:
- Instructions for your care in the event you become unable to manage your affairs
- Name guardians and trustees for minor children
- Provide for the transfer of your business
- Minimize the burden of taxes, court fees or other legal fees on your loved ones
- Provide for pets
- Provide for disabled minors so that there is no disruption in their government benefits
- Name the locations of important papers, passwords and other information of this nature
It is always wise to consult with an estate planning lawyer who has the expertise to advise you in the matter of wills and living trusts. One of our experienced estate planning attorneys can help you navigate the laws of North Carolina and are able to advise you of all the pros and cons of each type of will or trust so that you can find the best option for you and your family.