While death can be the end of some problems, it can also be the beginning of more for those who survive. As heirs, they will be the ones in charge of your estate. If you left a mess behind, then they will be the ones who have to untangle it. Fortunately, you can resolve a lot of these problems with some good estate planning. Here are some issues you and your lawyer should focus on.
Choosing an Executor
Before anything else, you need to choose the person who can be the executor of your estate. They will be the ones in charge of handling all of your assets so that they go to the right people. Additionally, it is also their responsibility to pay off the debts you incur. Considering this is a significant responsibility, choosing an executor correctly is essential.
The best choice would have to be a friend or a family member that you can trust. Fortunately, the position of executor has its perks since they get a commission for their job, so it can be a reward, too. While you can get your lawyer to be an executor, they will be charging a fee for the job. They may not be the best choice.
Outstanding Debts and Taxes
If you have any outstanding debts or taxes that need to be paid, your estate will be handling them. This can be a simple thing to do. An estate that is solvent enough can easily pay all the liabilities without any trouble. That should be your responsibility. Most of the final debts will likely be concerned with the last hospital and funeral expenses.
At the very least, your estate plans should have some funds ready for debt payment. Debt payment can be a problem if there is no ready money. The executor will then have to sell some assets off to pay the debts and obligations in full.
Sharing of Assets and Property
Your estate plans have to be very clear on how you want your assets to be shared. A common mistake that many people make is to try and make things simple by having one person inherit everything. They then trust that person to do all the sharing for them. This is terrible estate planning and an undependable approach. Once someone legally inherits your assets, they are under no obligation to share what they received. Better to make a complex will so that everyone gets something from you, even your favorite charities.
Life Insurance and Benefits
At your death, there might be several financial plans that have to be resolved. The most obvious one is any life insurance plan you have. As long as copies of the documents are with your lawyer, this should be easy to implement.
Another benefit that you don’t want your family to miss out on is Social Security. There are survivor benefits, which payout as long as you are still getting payments when you die. To help your loved ones claim Social Security benefits, work with your lawyer to ensure that spousal and survivor benefits transfer easily.
Contingencies and Backups
Not everything can be predictable, so you should have alternate estate plans ready in case one or more of your stipulations cannot be met. For example, your chosen executor might not be available, so the court might have to appoint one.
A more common situation is that one or more of your beneficiaries dies, and you have not updated your will to reflect that. This is where having contingent beneficiaries is essential. With a contingent in place, there will be no lengthy disputes about your intentions and can ensure that you give fewer headaches to your heirs.
To further avoid any such issues, you should always be ready to update your will. It should be a policy for you to update it after any major life event in your family. This includes deaths, marriages, and births. You don’t want your new daughter-in-law or granddaughter to not get anything from you. Even without anything significant happening, it is good to update your will every three to five years. This is especially important as you grow old.
Your death will be a sad occasion, and your loved ones need fond memories of you. Ensuring that all of your legal issues are solved and that there is no need for extended court visits can help. Coordinate with your lawyer the moment you enter retirement age so that these issues can be resolved as smoothly as possible.
