When you start to conceptualize your estate plan, it is important to consider the administration of the estate after you are gone. If you take steps to streamline the process for the administrator, your loved ones will be the ultimate beneficiaries. We will provide some food for thought on the subject in this post.
The Estate Executor and Probate
If you use a last will as the centerpiece of your estate plan, you would name an executor in the document to act as the administrator. The executor would identify and inventory the assets that will eventually be passed along to the heirs that are named in the will.
Depending on the nature of the estate, this can be far easier said than done.
It can be challenging to inventory the assets under some circumstances, and the executor will have to run down all of the appropriate ownership documents. There is also the matter of the financial accounts and all the important information that is associated with them.
This is not to say that this is an impossible task because executors have been taking care of these things for generations. However, when you learn about an alternative that is widely embraced, you may decide that it is unnecessarily inefficient.
Another unwieldy aspect of this process is the time consumption. You probably want your heirs to receive their inheritances as quickly as possible after you are gone. Unfortunately, there is a considerable time lag when you use a will.
It will take the court nine months to a year to probate and close the estate in most cases, and inheritances cannot be distributed until that closing day comes.
Revocable Living Trust
You can avoid the scenario that we described above if you use a revocable living trust to transfer assets in lieu of a last will. You keep control of the assets while you are living because you can act as the trustee and the beneficiary throughout your life.
To account for the administration of the estate after your passing, you name a successor trustee, and your heirs would be the beneficiaries. The trustee can be someone that you know personally, but there is another option. Trust companies and some banks offer professional trustee services so this is a viable option if the trust is adequately funded.
To make things simple for the successor trustee, you can make sure that everything that you want to pass along to your loved ones is signed over to the trust.
There is no reason to be concerned about losing access to the property. As we have touched upon, you would have total and immediate access to all of the assets that you conveyed into the trust. It is also possible to convey additional property that you acquire along the way into the trust.
When it is time for the trustee to step in to administer the trust, all of the assets will be neatly consolidated which simplifies a potentially complicated inventory.
You can account for personal property that you may have never conveyed into the trust for whatever reason through the inclusion of a pour-over will. When you have this type of will in place, the personal property would be “poured over” into the living trust to complete the consolidation.
Attend a Free Webinar
We have always conducted seminars at strategic locations throughout our service areas to help our neighbors understand the importance of the estate planning process. Out of an abundance of caution, we have converted to webinars in light of the dangers that are presented by COVID-19.
This is actually more convenient for many people all things considered. You can get all of this valuable information in real time streamed to you in the comfort of your own home.
There is no charge to attend these webinars, but we ask that you register in advance so that we understand how many people we should expect. You can visit our webinar page to see the schedule and obtain registration information.
John’s practice focuses on the use of Wills and Living Trusts in Estate Planning to help individuals protect their families and preserve their legacies after their deaths, but his practice also focuses on the critical issues of protecting individuals with dementia or other diminished capacity, assisting individuals in qualifying for Medicaid and other government benefits to offset the costs of long-term care, and providing special needs planning.
John is admitted to practice law in North Carolina, South Carolina, Kentucky, and Ohio, and he is accredited by the Department of Veterans Affairs.
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