Intestacy

Serving Southwest Florida

Helping clients plan for their family's future, by creating an efficient, thoughtful and comprehensive estate plan that preserves their legacy and gives them peace of mind.

Avoiding Probate With Ownership

When your goal is avoiding probate, there are three categories of property, and only one requires probate, so it can be accessed when the owner passes away, says njmoneyhelp.com’s recent article entitled “How can we avoid probate for this account?”

First, it’s important to understand that property that passes by operation of law is any asset that’s owned jointly with right of survivorship. These accounts are sometimes labeled as “JTWROS.”

When one co-owner dies, the property passes by law to the surviving co-owner. This is a way of avoiding probate.

Married couples in Florida have a similar ownership known as tenancy by the entireties.  It also has a right of survivorship.

A second category is contract property, which includes life insurance, retirement accounts and any non-retirement accounts that have beneficiaries designated upon death.

These designations supersede or “override” a will and are also a means of avoiding probate, directly passing to the named beneficiary.

These are frequently designated as “POD” (payable on death) or “TOD” (transfer on death).

The third category is everything else. This includes accounts that are owned solely by the person who died with no POD or TOD designation and is usually subject to probate.

A certificate of deposit is a time deposit. It’s a financial product commonly available from banks, thrift institutions and credit unions. Certificates of deposit are different from savings accounts because a CD has a specific, fixed term and usually, a fixed interest rate.

To avoid probate to access a CD or any other account owned by a spouse’s name, you can either make the account jointly owned by husband and wife with right of survivorship. or designate your spouse as a beneficiary upon death.

Either option will succeed in avoiding probate to access that particular account, like a certificate of deposit.

Contact an experienced estate planning attorney with questions about CDs and probate.

Reference: njmoneyhelp.com (June 6, 2019) “How can we avoid probate for this account?”

Letter of Last Instruction

It is important to know that a Letter of Last Instruction does not pass through a legal process. It’s an informal but organized method of providing your family with instructions on the decisions related to financial and personal matters that should be made when you die. This can also be an alternative way of ensuring that your family are cared for after your death and to prevent issues that could arise from not probating the will.

Qrius’ recent article entitled “How to Prepare a Letter of Last Instruction” explains that preparing it can relieve your relatives of added headaches and stress after your death because it can provide crucial information on personal, financial and funeral matters. Here are some ideas as to what to include in your Letter of Last Instruction:

Personal info. This is a basic information like your full name, date of birth, father’s name and mother’s maiden name, address, Social Security number and place of birth. Add information about significant people in your life, like family, friends, business partners, clergy and others you’d like to be notified about your death.

Business and Financial Contacts. List the contact info of your business and financial partners, as well as your accountant and investment adviser. Include information on your insurance policies, as well as your bank account details.

Legal Document Location. Make sure your executor can find important legal documents, such as your will, tax returns, marriage license, Social Security card, birth certificates, trust documents, deeds, veteran benefits info and contracts. State the location of those documents in your Letter of Last Instruction.

Loan and Debt Info. Make a list of creditors containing collateral and payment terms, along with any credit card account numbers and loan account numbers. Likewise, list the people who owe you money, including their contact info and collateral and payment terms.

Usernames and Passwords. Include a section with your usernames and passwords for your online banking accounts, social media email, computer, smartphone and other electronics, so your executor or someone responsible for overseeing your estate can be certain your accounts and financial information are not compromised after your death.

Beneficiaries. Make a list of the names and contact details of all your beneficiaries with additional information on specific instructions you may want to give to clarify your intentions on the distribution of the assets.

Funeral Arrangements. Include your desires as to your funeral arrangements, such as the type of flowers, pictures and service music. You can also state the clothes in which you wish to be buried, the type of service and location and other items that will help your family with this task.

Once you have the letter, be sure your executor or at least a close family member knows where it can be located after your death.

Ask an experienced estate planning attorney for pointers on writing your Letter of Last Instruction and keep updating it regularly.  We can help.

Reference: Qrius (Dec. 8, 2020) “How to Prepare a Letter of Last Instruction”

Estate Planning Documents For Retirees

Research of estate planning documents for retirees shows that most (53%) have a last will and testament. However, they don’t have six other crucial legal documents.

Money Talks News’ recent article entitled “6 Legal Documents Retirees Need — but Don’t Have” says in fact, in this pandemic, 30% of retirees have none of these crucial documents — not even a will — according to the 20th annual Transamerica Retirement Survey of Retirees.

In addition, the Transamerica survey found the following about estate planning documents for retirees:

  • 32% have a power of attorney or medical proxy, which allows a designated agent to make medical decisions on their behalf
  • 30% have an advance directive or living will, which states their end-of-life medical preferences to health care providers
  • 28% have designated a power of attorney to make financial decisions in their stead
  • 19% have written funeral and burial arrangements
  • 18% have filled out a Health Insurance Portability and Accountability Act (HIPAA) waiver, which allows designated people to talk to their health care and insurance providers on their behalf; and
  • 11% have created a trust.

The study shows there is a big gap that retirees need to fill, if they want to be properly prepared for the end of their lives.

The coronavirus pandemic has created an even more challenging situation. Retirees can and should be taking more actions to protect their health and financial well-being. However, they may find it hard while sheltering in place.

Now more than ever, seniors may need extra motivation and support from their families and friends.

The Transamerica results shouldn’t shock anyone. That is because we have a long history of disregarding death, and very important estate planning questions. No one really wants to ponder their ultimate demise, when they can be out enjoying themselves.

However, creating estate planning documents for retirees now will give you peace of mind. More importantly, this planning can save your heirs and loved ones a lot of headaches and stress, when you pass away.

Talk to an experienced estate planning attorney today to get your plan going.

Reference: Money Talks News (Dec. 16, 2020) “6 Legal Documents Retirees Need — but Don’t Have”