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Pour Over Will

5 Most Common Estate Planning Errors

By | Asset Protection, E-Alert, Estate Planning, Healthcare documents, Living Will, Pour Over Will, Will | No Comments

Most families don’t receive their wealth through inheritance or winning the lottery, but rather through years of hard work and sacrifice. However, it always amazes me that although everyone understands that we are all going to die, a vast majority disregard estate planning completely.

Here are five common estate planning mistakes that can ruin the legacy that you have worked so hard to build.

1.  No Will.  Approximately 70% of Americans do not plan at all, and therefore die ‘intestate’. Depending on which state you live in, dying without a Will could unfortunately cause your estate to pass to people that you wouldn’t have chosen.

2.  Failing to update your estate plan.  Too often, people that have an estate plan allow their plan to collect dust on a shelf. The plan is forgotten. Life changes such as divorce, deaths and births can have a significant impact on one’s original choices. For example, when you create a Will and leave everything to your spouse, you don’t anticipate a future divorce where your hard earned funds could go to the ex-spouse’s new family. Depending on the state, this could happen. An estate plan should be reviewed every 2 years to ensure that your choices are up to date with life’s changes.

3.  Unrealistic view regarding beneficiaries.  Every person should ask themselves if their chosen beneficiaries will be mature enough emotionally and financially to handle a pot of cash. Are they a spendthrift? Do they have a drug problem or gambling issues? If there is any doubt now, your estate plan can take these issues into account and protect your beneficiaries from themselves.

4.  Inadequate estate plan.  Some families begin estate planning with a simple Will; however, as years go on and assets are accumulated, the Will may not be the strongest tool. A properly drafted Revocable Living Trust will allow for the avoidance of a living and death probate, restrictions on spendthrift beneficiaries, and asset protection and a minimization of tax issues.

5.  Failure to change Personal Representative and/or Trustee.  Sometimes those we name in fiduciary roles may no longer be the best choice. Our relationships with these folks may change over time, or they may move out of state. Reviewing your plan every 2 years is essential to ensure that your choices are the best they can be.

Wendy-Harn-PhotoContributed by Morris Hall, PLLC Tucson, Oro Valley and Green Valley Estate Planning Attorney and Partner, Wendy W. Harn.

About Morris Hall, PLLC:
At Morris Hall, PLLC we have focused our legal practice on estate planning for over 45 years.  Along with estate planning, our attorneys help clients and their families with matters of probate, trust administration, wills, power of attorneys, business planning, succession planning, legacy planning, charitable gifting and other important legal aspects.  We also have divisions in financial, real estate and accounting to help you incorporate all of your planning together, ensuring that everything works perfectly for your needs and situation. We have offices throughout Arizona and New Mexico.  Contact us today at 888.222.1328 to schedule an appointment!

This blog should be used for informational purposes only.  It does not create an attorney-client relationship with any reader and should not be construed as legal advice.  If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.

Pour Over Will

By | Estate Planning, Other, Pour Over Will | No Comments

A Pour Over Will is a “safety net” for any assets inadvertently left outside of the trust when you pass away.

For example, Mary created a Revocable Living Trust and titles all of her assets to the trust, except for her bank account worth $80,000. Mary passes away. Will this account trigger a probate?

In Arizona, if the accumulation of assets is less than $75,000, there are simpler mechanisms to transfer the assets by way of affidavits to the deceased’s beneficiaries. However, if the total of the assets is more than $75,000, and no beneficiaries listed, a probate would be necessary.

In our example, if Mary has assets totaling $80,000, the Pour Over Will would be used to ‘pour over’ the assets back into the trust. It’s not a regular Will, but rather a Will associated to the trust. Typically when the Pour Over Will is used, it’s a small probate proceeding in the courthouse. Unfortunately, an extra expense and delay would occur to go through the process of transferring the assets back into the trust.

Ideally, if you have a properly funded trust, the Pour Over Will would never be used. You should have your trust reviewed every 3 years to ensure it is properly funded.

Why Choose Morris Hall:
You have a number of options when it comes to estate planning, so why pick Morris Hall?  First off, estate planning and asset protection are a very complicated endeavor and you should only trust someone who focuses exclusively on those matters.  Also, MH is a proud member of The American Academy of Estate Planning Attorneys (AAEPA) which provides us additional support, advanced training, tools and information that is not available to others – which means that we can better protect your assets and your loved ones.  We are one of only two firms in Arizona that belong to the AAEPA and are the only firm in New Mexico that has been granted membership.  If you have assets and loved ones that you want to protect, you are in good hands with MH.  Contact us today at 888.222.1328 to schedule an appointment!

This blog should be used for informational purposes only.  It does not create an attorney-client relationship with any reader and should not be construed as legal advice.  If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.