Holiday Travel and Estate Planning Things to Consider Before You Travel

holiday travelWith the holidays approaching, many of you will be traveling to visit friends and family.  Before any trip, most of us create a to-do list.  If you have been procrastinating about putting an estate plan in place, use this holiday trip as your deadline to finally do so.  Most people believe that estate planning is only for the very wealthy, old or retired individuals.  This is simply not true!  Estate planning is for everyone over the age of 18.

Listed below are some considerations that may motivate you to put your estate plan in place before this year’s holiday travel.

• Without an Estate Plan …
In Florida, if someone dies without a Will or a trust, state law says the surviving spouse gets everything if there are no other descendants or all the descendants are of the same bloodline of the deceased spouse AND the surviving spouse; BUT if there are descendants that are NOT of the same bloodline as the surviving spouse and the deceased spouse, the surviving spouse only gets one-half of the estate …. In Florida, where there are many second marriages and often more than one set of children, not having an estate plan can have unintended consequences — maybe the surviving spouse will not have enough money to live on or certainly less than may have been intended.  If your children are minors, the court will control what they receive until they are 18, at which time they will receive their inheritance. (Most parents prefer their children inherit money later than 18 years, when they are more mature.)

• Without a guardian named for your
minor children…
A guardian for minor children can only be named through a Will. If both parents die before naming a guardian in a Will, the court will name someone to raise them without knowing whom the parents would have chosen.

• Mistaken reliance on joint ownership…
Many people add an adult child to the title of their assets, often to avoid probate. This can create all kinds of problems. When you add a co-owner, you lose control over that asset. Jointly-owned assets are now exposed to the co-owner’s creditors, divorce proceedings and possible misuse of the assets; in addition, the co-owner must agree to all business transactions involving that asset such as sale or mortgage of the asset. There could also be gift and/or income tax issues. And if you have more than one child but only name one to be co-owner with you, fluctuating values could cause your children to receive unbalanced/unintended inheritance amounts.

• Without planning for incapacity…
If someone cannot conduct business due to mental or physical incapacity, only a court appointee can sign for this person even if a valid Will exists. (A Will only goes into effect after death.) The court usually stays involved with the incapacitated person’s assets until the person recovers or dies and the court, not the family, will control how those assets are used to provide for their care. The process is public and can become expensive, embarrassing, time consuming and difficult to end.

The foregoing issues may be avoided by:
1.    Creating a living trust. (revocable trust)  As trustee of your living trust, you maintain control of how your assets are disbursed while you are living and, should you become incapacitated or die, the person you choose to act for you as successor trustee does so without court interference.  Should you die, your trust then becomes irrevocable and your successor trustee is able to disburse your assets to your beneficiaries through trust administration (avoiding probate) as indicated in your trust.  Your trust may also contain provisions that control how and when your assets are to be distributed protecting them from creditors, predators and, possibly, unnecessary estate taxes.

2.    Designating a Healthcare Surrogate.  Someone also needs to be given the power to make health care decisions for you (including life and death decisions) if you are unable to make them for yourself. Without a designated health care surrogate, you could be kept alive by artificial means as was Terri Schiavo.

Putting your estate plan in place before you travel will give you the opportunity to discuss your plan choices with family when you visit. The more they understand your intentions, the more likely they are to accept your decisions, which will help to avoid discord when your successor trustee or health care surrogate needs to step in.

It is also very important to discuss your plan with your successor trustee and health care surrogate so they fully understand what their roles and responsibilities will be – what better time than the holidays!

This article does not constitute legal advice and may not be relied upon as such.  Each individual’s facts and circumstances are different.
If you have any questions regarding your particular situation, please consult with legal counsel. – 239-225-7911

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