One of the most overlooked and misunderstood notions of planning for later in life is figuring out (or not) what will happen to your property after you die. Or, as one of my New York friends said recently - a Will? But I am not dying yet! The truth is, we are all going to die one day. But most of the people do not want to think about the time when they are no longer here. Many others, think they have no or very little assets, and that estate planning is for the rich. But it is important to plan in order to prevent any property that you own at your death from going into the hands of someone you don't want to. Do you have children or a spouse you will need to provide for? Are you in your second marriage or planning to get married? Do you have a family business, savings, or assets that need protection? Are you passionate about certain social causes and charities? Do you have pets you will need to provide for? Figuring out the answers to these questions now and putting together a Will or a Trust will prevent headaches for your loved ones in the future and preserve your hard-earned life assets.
If you do not have a will and do not take the time to plan for your estate now, it could cause difficulties or even disastrous consequences for your family members later. Some of these consequences include:
- You leave it up to the state to decide what happens to your money and other assets, instead of leaving a set of clear instructions in a Will as to who gets what. Under the New York State law of intestacy, the assets are divided between your spouse and children; if no children, all goes to your spouse, even if as sometimes happens, you have long separated but never formally divorced.
- If there is no spouse or children, under the state law your assets will be distributed to your other relatives, whom you may not like or even hate, and with whom you have not had relationship in years or decades.
- In New York, if you live with a life partner but you never married, your partner, no matter how long you lived together, will not inherit anything.
- Your children or siblings become involved in disputes and stop talking to each other or seeing each other ever again.
- If you have minor children, the state will decide who will take care of them and their property, if both parents are deceased or if one is alive but unable to take care of the children. Or the surviving parent may need to apply for a court's permission to become a guardian of the children's property, and possibly post a bond and do annual accounting to the court.
- Your family would have to scramble to obtain a formal permission from the court to access your bank or brokerage accounts, or sell your car or other valuable asset, which may take many months or even years. And as a result, they will be forced to pay higher attorney's fees and estate administration costs.
- If there are no surviving family member, your property will pass to the state, rather than to your friends or charities of your choice.
- Without an original will, there is a significant possibility that your designated charity's bequest will be lost to your statutory distributees who you hardly knew or had relationship with.
Our clients say they feel relief and peace after signing their wills and/or trusts, knowing that they have an estate planning document in place and that they fulfilled an important responsibility to themselves and their loved ones. You too can be on the path to feeling such relief and peace by starting to prepare your will or trust today. If you need help gathering your thoughts and want to get started on your estate plan, contact our office today.