Imagine this… if you can. Your life is just beautiful. You’re working, spending time with friends and family. The farthest thing from your mind is estate planning. Everything’s going so well! Then, out of nowhere, something happens to upset the status quo. At first, it might be no big deal. Then, it starts to spread and affect other areas of your life.
With the pandemic of Coronavirus on our doorstep, more and more people are wondering, “What if?” In this article, we will explore options and ideas for having the peace of mind that comes with estate planning.
Do You Have Your Basic Documents Completed?
There are three essential components to estate planning that apply to everyone, and these documents must be completed first as part of any estate plan.
Your Last Will and Testament
This document sets into writing how you intend or desire your estate to be distributed upon your death. Careful planning will prevent unnecessary drama at the time of your passing. If you should die without a will, the state will decide how your estate will be handled.
Power of Attorney
With a power of attorney, a “principal” (the person granting power of attorney) assigns these rights to an “agent.” It’s essential to understand the distinction between two different types of powers of attorney. A limited power of attorney assigns an agent and gives them the ability to act for the principal only in certain circumstances. A general power of attorney allows them to conduct ALL business transactions for the principal. In Maryland, written powers of attorney are considered “durable,” which means they remain in effect even if the principal is no longer able to make decisions on their own.
Advance Medical Directives
This particular power of attorney designates someone to act on your behalf when it comes to making medical decisions for you when you are unable to. Typically, a medical professional, or a group of professionals, will make a judgment when the advance medical directive is in effect.
Planning Your Estate Online… Do You Need a Lawyer?
Many lawyers, including this office, offer estate planning via video conferencing apps. If you are uncomfortable leaving the house, we can help you to assemble the necessary documents by discussion over a teleconferencing app, and prepare them to your specifications
When you are planning your estate online instead of in person, you might think it makes sense to use an online estate planning software. It may be tempting to save a little money and go this route. However, there are many aspects of estate planning that you will miss if you decide to take advantage of this option.
What Are the Advantages of Hiring a Lawyer for Estate Planning?
Once your estate planning is complete with your attorney, you have the peace of mind that everything is in place should the worst happen. Completing a form online may leave you thinking, “I guess it’s okay.” Consider the following advantage of hiring a lawyer to help you.
You Can Ask A Lawyer Questions
Unless you’ve done this several times before, you’re likely to have a lot of questions. These can be answered on the spot during a meeting with an attorney.
A Lawyer Will Know and Be Able To Explain Alternative Solutions
If you have no idea of the alternatives, how can you be sure that you’re making the right decisions? An attorney can explain different options to you so that you can consider your best course of action.
A Lawyer Can Explain any Legal Terms You Don’t Understand
When you’re dealing with legal documents, it’s not unusual to get overwhelmed with all the legal terminology. Getting an explanation of legal terms in everyday language can help you from misunderstandings later.
It’s often assumed that a last will and testament will be followed to the letter, regardless of the personal preferences of the surviving family members. But in fact, will disputes are not as uncommon as you might think. If you suspect you are about to become involved in a will dispute, you should consult an estate planning lawyer in Baltimore without delay. Certain situations may be more likely to lead to a challenge of the will than others.
Divorce and remarriage can be contentious situations after death as well as during life, particularly if the first marriage produced children. Sometimes, it is discovered that the decedent left the entire estate to the last spouse that he or she married. In turn, the inheriting spouse may leave the assets to his or her surviving children. The children from the previous marriage may become disgruntled that they were not named as beneficiaries in the will. These children may decide to contest the will, perhaps by claiming that the spouse from the second marriage coerced the decedent into signing a new will.
Deciding whether or not to leave children an inheritance can be a highly sensitive choice. It is the right of the testator to decide exactly how his or her assets will be distributed. In some cases, individuals prefer to give their entire estate to charities, rather than to family. While this is certainly a legally allowed decision, the children or other family members who are disinherited may raise objections to it. Testators may try to avert future will disputes by writing a letter that explains his or her choices.
A similar situation is when one of the beneficiaries receives a significantly larger inheritance than the others. Sometimes, a testator will decide to leave a larger portion of the estate to an adult child who served as a primary caretaker of the testator. In other cases, the testator may leave a larger inheritance to the family member who is most likely to be financially responsible. Again, this is a legal right of the testator, but it may lead to future conflicts.
Individuals who were adopted often have many questions about their birth parents . It isn’t always possible to uncover the identities of the birth parents, especially if it was a closed adoption. However, the first step is to consult a lawyer in Baltimore. A lawyer can guide you through the process of filing consent for contact and a waiver of confidentiality with the Department of Social Services. If your birth parents have also filed this paperwork, then the identities can be disclosed. In many cases, however, mutual consent is not given.
Watch this video to find out what you can do if the adoption was closed and mutual consent is not given. This professional explains that you can have a lawyer petition the court to open the records. In the petition, you must provide compelling reasons why the court should open the records. For example, you may need information about your birth parents for medical reasons.
In the state of Maryland, a child is a minor until he reaches the age of 18, after which he is considered an adult. If you have a minor child under the age of 18, naming a guardian or custodian in your will is an important step toward ensuring he is cared for by an individual you trust in the event that you pass away before your child reaches adulthood. Regardless of whether you have already written a will in Baltimore or are preparing to complete this important task, reviewing or determining your choices for guardian and custodian is important for your child’s future.
Designating a Guardian
A guardian is an individual to whom your child’s care is transferred if both parents pass away. Naming a guardian in your will means you want this person to care for your child as if they were a parent until your child is no longer a minor. Guardians perform all parental duties, including making decisions regarding a child’s upbringing, education, religious teachings, and medical care, so it’s important to choose a person that you trust with your child’s wellbeing. It’s also important to note that if the individual named in your will is not your child’s surviving parent, your wishes could be overridden in court and custody provided to the remaining parent if a judge feels it is the best situation for your child.
Designating a Custodian
Because minor children cannot inherit property or financial assets, you should also name a custodian in your will to handle your child’s inheritance until he reaches a certain age or meets a specific milestone, such as graduating from college. The individual named in your will as your child’s guardian can also serve as his custodian, or you may choose a different person to handle your child’s finances and assets as the custodian. Thus, if you feel the person you want as your child’s guardian is not the best individual to manage his inheritance, you can opt to name a different custodian to protect your child’s financial future.
When you visit an estate lawyer in Baltimore to have your last will and testament drawn up, you might think that the document is beyond anyone else’s ability to challenge. But in fact, after a person dies, a will may be challenged in court. A disgruntled relative might try to claim that the will isn’t valid, for example. This is why you might want to talk to your estate lawyer about including a no-contest clause in your will.
A no-contest clause cannot definitively prevent anyone from challenging the validity of your will in court. However, it can certainly discourage your heirs from trying to do so. For example, if you leave your child $10,000 and your child feels that he or she should have received more, the presence of a no-contest clause means that if your child contests the validity of the will, he or she will receive nothing. On the other hand, if you entirely disinherit the child, then he or she has nothing to lose by attempting to challenge the validity of the will.
One of the benefits of estate planning with an experience estate attorney in Baltimore is finding ways to help your beneficiaries avoid probate. Probate is long and expensive, and if you don’t set up your estate properly, your assets could be tied up for an extended period of time. Fortunately, an estate lawyer can help you use legal tools that let you pass property to your beneficiaries outside of probate, saving considerable time and money. Here are some of the strategies that can be useful in protecting your assets from probate.
Joint Property Ownership
You can use the right of survivorship to prevent a property from entering probate by owning it jointly. Jointly owned properties automatically pass to the co-owner upon the death of the other owner, with no need for probate. Typically, your estate lawyer will create a legal document that sets out the joint ownership and the right of survivorship. Although married couples usually have joint property ownership, the agreement doesn’t have to be between two spouses. Anyone can create a joint property ownership agreement with any person they wish to inherit the property without having to deal with probate.
There are certain types of financial accounts that allow you to name a beneficiary to inherit the account when you are gone, thus passing outside of the will and the associated probate process. These accounts include payable on death (POD), transfer on death (TOD), and retirement accounts, including traditional and Roth IRAs and 401(k) accounts. However, keep in mind that an surviving spouse often has a right under the law to some portion of your retirement accounts, so even if you don’t name him or her as the beneficiary, they may automatically receive a least a portion of them. Your estate planning lawyer can help you plan accordingly.
Revocable Living Trusts
Revocable living trusts let you transfer assets to a trustee while you are still alive, with the right to cancel the trust at any time. The trustee becomes the owner, so the property can no longer be included in your estate and will not enter probate upon your death. The trustee will then distribute the assets as instructed by you in documents prepared by your attorney.
One of the methods people use while estate planning to avoid probate is a living trust. A living trust allows you to pass assets outside of probate to your beneficiaries while you are still alive. When building a living trust, it is important to work with an experienced estate lawyer in Baltimore to ensure that it is established correctly.
Watch this video to learn more about living trusts. Because probate can be lengthy and expensive for your beneficiaries, many people focus on taking steps to avoid it while going through the estate planning process. Living trusts are also beneficial for people who wish to avoid probate because of privacy concerns or who want to ensure certain assets get to the intended beneficiaries by passing them outside of the probate process.
Estate planning is one of the most important things you and your spouse will do for your family, but starting the conversation isn’t always easy. Scheduling an appointment with an estate lawyer in Baltimore is a good step, but it can be helpful to have a conversation before your meeting so you can align your priorities and come up with a list of questions. Use these tips for talking to your spouse about estate planning.
Start With Why
Before you begin the estate planning process, discuss why it is important to you and why you want to begin it now. In some cases, you may only have a vague idea that estate planning is something you’re supposed to do and feel like you are at the age to do it. In other instances, you may have very specific goals you want to accomplish. By identifying why you want to make a plan for your estate, you can focus in on your goals and create a framework for your decision making process.
Identify Your Non-Negotiable Points
You and your spouse may have some very specific things you hope to accomplish with your estate, and it’s important for your attorney to understand these needs up-front. You may have a family business that you want to pass on to your heirs in a specific way, or you may have a child with special needs that you want to make preparations for. Make a list of the things your estate must do so you can make sure your plans meet these needs appropriately.
Take a Break When You Disagree
Estate planning should be something you and your spouse feel good about together, not the source of conflict. If your conversation becomes heated over things like making a living will or setting up a trust, take a break. Allowing each other time to think and returning to the conversation when you’re calm again will make the process easier.
When you give an individual power of attorney , you allow that individual to make legal, financial, or other decisions in your stead. If you choose to grant power of attorney, you may opt to turn over decision-making immediately, or only under certain circumstances. Health care power of attorney is a document that allows a person you trust to make decisions on your behalf in terms of health care and treatment options if you are unable to communicate or make these decisions for yourself. Without this document, health care decisions will fall to family members in an order specified by state law. You can find out more about granting health care power of attorney in this informative video; if you have other questions about this document or about any other aspect of estate planning or will writing, contact your lawyer in Baltimore for personalized answers and advice.
When you hire an estate planning attorney in Baltimore , it is important to ask the right questions so you can make the best choices for yourself and your heirs. There are many different things to consider when make an estate plan, so it can helpful to prepare your questions in advance so that you don’t overlook anything. Consider adding these questions to your list for your meeting.
What kind of experience do you have?
Estate law can be extremely complex, and it changes frequently. It is important to hire an estate lawyer with experience in the field, rather than an attorney who is simply willing to make a plan for you. The advice and information you get from an experienced attorney is invaluable, and by working with an experienced estate lawyer, you can feel better about the decisions you’re making and how they will impact your heirs.
Can you help me with a trust?
Not all estate planning attorneys are willing or able to help you establish a revocable or irrevocable trust, so if this is one of your goals, ask your prospective attorney up front if he or she can manage your request. There are many advantages to setting up a trust and using it in place of a will for some families, so ideally, your attorney will help you decide if a trust is right for you and assist you in setting it up.
Is it possible to avoid probate?
Many people who are making plans for their estate wish to avoid probate for their heirs if it is possible. Going through probate is time-consuming and costly, and can cause conflict within the surviving family members. Ideally, an estate planning attorney can guide you towards options, like trusts, that can limit the probate process. If it isn’t possible to avoid probate, ask your attorney if he or she will be available to guide your heirs through the process.