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Making Sense Out of Dollars

Will It?

Joel Lerner, Columnist
Posted 3/5/21

Part 9 of 12

How Can You Be Certain That The Distribution Of The Estate Will Be Without Problems?

You can make probate (the settling of the will) easier by following these simple …

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Making Sense Out of Dollars

Will It?

Posted

Part 9 of 12

How Can You Be Certain That The Distribution Of The Estate Will Be Without Problems?

You can make probate (the settling of the will) easier by following these simple procedures:

1.   If you have made previous wills, tell your lawyer to destroy all earlier ones.

2.   Choose a successor executor if your original choice cannot serve. Also, list contingent beneficiaries in the event your first choice may die before you or decline the inheritance.

3.   In the event you have young children, pick a guardian in case they should become orphans.

4.   Devise an order of payment if your estate becomes too small to pay all legacies.

5.   Decide in advance whether the executor is to receive the standard compen­sation or a bequest from you.

6.   Keep your will in a safe place (your lawyer’s office and a copy at home) but preferably not in a safe deposit box; if the box is sealed upon your death, getting into it may be time consuming and difficult. If you insist on the safe deposit box, open two of them and put your will in your spouse’s safe deposit box and vice versa.

7. When making any bequest, leave a percentage of your estate rather than a fixed dollar amount, because your assets may either grow or shrink over the years. Remember the decrease in value in 2007-2009 for stocks owned? For example, it is better to say, “I leave 10 percent of my estate to XYZ Charity than to give a specified amount--$50,000, for example. If your estate should be reduced in value for whatever reason by the time you pass on, the $50,000 could be excessive in relation to the needs of those to whom you are leaving the balance of the money. Just remember that you will not be able to bequeath any property you own that is jointly held by “tenancy in common”.

8.  Make certain that your will is properly drafted, or it may be interpreted in a manner that you did not wish. For example, if you want to disinherit a child, be sure to specify in your will that you are doing it. If not, the child might later claim to have been overlooked by mistake. Don’t use your will to throw your final insult at any individual; find some other means to get even.

9.  If a beneficiary in your will (including your spouse) must enter a nursing facility, remove his or her name from the will. If you don’t do this, the bequest may be seized as payment when you die and the will is probated.

10. In certain situations, it is better to leave property in trusts rather than in out­right bequests. A trust is simply an arrangement for transferring the title to your property (your ownership) to another person or company to hold in trust for you or anyone you designate. Trusts set up under a will are called testamentary trusts and become effective upon the death of the person who drew up the will. The trustee holds the property you otherwise would have bequeathed outright, and invests and administers it for the benefit of your stated beneficiaries. Trusts are frequently written into wills to ease the impact of estate taxes (particularly of minors until they have matured). There are countless ways of setting up trusts, and so great care must be exercised to obtain the best possible legal tax advantages.

THOUGHT FOR THE WEEK

“Running away from a problem only increases the distance from the solution.”

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