In estate planning, you create mechanisms to transfer your assets, property and money to your loved ones after you die. This is a significant transaction, to say the least. Transferring your property and guardianship of your minor children in a proper, orderly way is extremely serious.
Estate planning includes preparing a Last Will & Testament, creating trusts, nominating guardians, granting powers of attorney and designating beneficiaries on financial accounts.
If you don’t prepare and sign the necessary legal documents that transfer your property and minor children to your desired beneficiaries and guardians, the State of Alabama will do it for you.
Here are five reasons not to delay estate planning:
1. Race To The Courthouse
If you die without a will, your family must race to the courthouse to request letters of administration. If they don’t file within 40 days, they lose their right of priority, and the county administrator or your creditors will manage your estate. Your family will lose direct control and must appeal to the court with any concerns about the estate’s administration.
2. The state decides who inherits
If you don’t plan, the State of Alabama will decide who receives your estate. For example, you might want your surviving spouse to receive your entire estate, but the State will give upwards of one-half of it to your biological children. If your adult children live out of state, failure to implement an estate plan can force them to make multiple trips to Alabama to manage the estate or transfer the family home to themselves, assuming they are even able to administer the estate. Non-residents are not permitted to administer estates in Alabama unless a will authorizes them to do so.
3. Risk of losing the family home
Your family home is likely your largest, most cherished asset, but your family may lose it to creditors if you delay estate planning, and this planning involves more than simply stating in your will who gets the house. Have you made sure your home’s title is held in a manner that eliminates the need for your surviving spouse to file a petition with probate court to secure its transfer? Have you provided for payment of your mortgage the first few months after your death so the bank doesn’t foreclose?
4. Loss of control over wealth transfer
Delaying estate planning deprives you of critical information about how your wealth is transferred to loved ones. Our clients are often surprised by issues and concerns that didn’t even occur to them. For example, not everything transfers through your will. In effective estate planning, you must decide how these “non-probate” assets will be handled.
5. Guardianship and financial planning for minor children
If you have young children, delays in estate planning may deprive you of the ability to decide who cares for them if you die before they become adults. Alabama permits you to select your children’s guardian in your will. You can also engage in proactive financial planning for your young children, creating a testamentary trust that will set aside money to be used for their living expenses, education and transition into adulthood.
With estate planning, as with many things in life, an ounce of prevention is worth a pound of cure, so don’t delay. When the inevitable happens, people are always glad they’ve put an estate plan in place.
No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers.
