7 ESTATE PLANNING ANSWERS EVERYONE NEEDS TO KNOW Clear Answers to Common Questions
When it comes to estate planning, endless questions seem to have countless different answers. Before a migraine emerges, let’s cover the top seven most commonly asked estate planning questions to settle the score. Don’t worry; even the most legal jargon-averse can appreciate this quick guide! 1. Can I put a rental property inside a trust? Yes, and it’s a great idea! Placing your rental property in a trust protects it from going through probate and keeps things running smoothly for your beneficiaries. It can provide them with a steady income stream without the hassles of court proceedings. 2. Can I prevent my spouse from giving my assets to a new partner if they remarry? Absolutely! To safeguard your assets, you can set up a specific type of trust to prevent this, like a Family Wealth Trust. This ensures your assets are used as intended, even if your surviving spouse remarries. Clear documentation and legal guidance are crucial here to ensure everyone understands the stipulations you want. 3. Should I put my kids on the deed to my house? No, this can lead to unexpected complications, such as tax issues or financial vulnerabilities (like your child’s creditors claiming a stake). Instead, consider using a trust. It’s a safer mechanism that allows you to control how and when your house passes to heirs without exposing it to risks.
4. What happens to my kids if I die without an estate plan? Without an estate plan, the state takes over, and a judge decides who will care for your children without your input. You must create a will or set up a guardianship to ensure your children are cared for according to your wishes, not the court’s. 5. If my home has a mortgage, can I still put it into a trust? Yes, you can! Moving a mortgaged home into a trust is common and doesn’t interfere with your mortgage terms. This approach helps facilitate a smoother transfer to your heirs without probate. 6. How often should I update my estate plan? It’s wise to review your estate plan every 3–5 years or after any significant life event, such as a marriage, divorce, the birth of a child, or significant financial change. This ensures your plan remains aligned with your current circumstances and wishes. 7. What’s the difference between a will and a trust? A will sets out your wishes for after you die and goes through probate, which can be a lengthy public process. A trust, however, takes effect immediately upon creation, offers more privacy, and bypasses probate, allowing for a quicker transfer of assets. Armed with these answers, you’re better equipped to make informed decisions about your estate. Remember, the best approach often involves consulting with an estate planning attorney to tailor a plan that fits your needs and gives you peace of mind.
“Remember, the best approach often involves consulting with an estate planning attorney to tailor a plan that fits your needs and gives you peace of mind.”
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