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Will and Testament

Do I need a Will, a Living Trust or Both?

Estate planning is an emotionally charged issue, regardless of your family dynamics.  Broaching the subject of financial matters and death can make everyone feel uncomfortable.  Yet, it is one of the most important conversations to be had, as the future financial security of your family depends on the planning that you do now.  If you have a spouse, children or financial assets, it is important that you engage in estate planning.  Both a Will and a Living Trust are useful planning tools and they are often used together. If there is no estate planning done before death, there are laws called intestate succession that controls how your assets are distributed. 

What is a Will?

   A Will is a document that outlines your wishes for your assets after your death.  Without a Will, the court will decide how to distribute your money and property.  This can be a costly and lengthy process for your descendents.  Creating a Will can give you peace of mind for the parents of young children, as it allows for the naming of a future Guardian, which otherwise would be the decision of the court. It allows for the naming of an Executor, someone that you trust, that can distribute your money and assets to beneficiaries.  However, a Will becomes a public record when submitted to the court and anyone is able to read about your property and assets.   

What is a Living Trust?

   There are two types of Living Trusts; there is a Revocable Trust and an Irrevocable Trust.  The Revocable Trust is most commonly used, as it allows for the Grantor (or trust maker) to make changes to the Trust, throughout the remainder of their life.  For example, you can transfer additional assets into the Trust or you can change the terms of the Trust at any time. Another advantage of the Revocable Trust is that the successor Trustee can take control of your property and assets if the Grantor is deemed mentally incompetent.  In that case, the successor Trustee can manage your property and finances while you are alive.

     When you set up an Irrevocable Trust, you are fully surrendering ownership of your assets.  This can be useful in some instances, such as Medicaid planning for long term care.  When applying for Medicaid for long term care, there is a five year look back of your finances, however this look back excludes any assets in an Irrevocable Trust.  The Irrevocable Trust also offers you safety from creditors.

    Both types of Living Trusts are private documents and not for public viewing.  This can be a desirable option.  But the primary purpose of creating a Trust is to avoid probate court.  Probate is not required to transfer ownership of your assets.  The successor Trustee has legal authority to make all decisions without court involvement.

Should I have both a Will and a Living Trust?

   There are advantages to having both of these legal documents.  A Will enables you to name a Guardian for your underage children.  A Will is also useful if you gain assets and your death occurs without having transferred these assets into the Living Trust.  These assets will need to be probated, however your Will can state that forgotten assets after you die, can be transferred into your Trust. 

Do I need an Attorney to complete a Will or a Living Trust?

   Don’t risk a costly mistake with your loved ones future. There are many complex issues that can arise when completing legal documents, in order for them to be valid.  Always have a qualified Attorney looking out for your best interest.  Call the Boutty Law Firm P.A. today!

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Will and Testament

What Not to Include in a Will

Many people are aware that creating a will is a good way to protect your wealth and ensure that your assets are passed on to your beneficiaries. You may not be aware that there are some assets that you should not include when writing your will. Property that already has laws governing its distribution should not be included. The following types of property should be excluded when writing your will:

  • Transfer on death property: These assets do not need to be included in a will because they pass automatically to the person who was named a beneficiary on the account. Transfer on death assets include real estate, vehicles, and stocks and bonds.
  • Pay on death bank accounts: Similar to transfer on death property, these types of assets go directly to the beneficiary after the account holder passes away.
  • Property with a right of survivorship: Some property is communally owned by more than one party, and if the asset has a right to survivorship, the surviving party will take ownership of the property at the time of the other party’s death. It cannot be transferred onto beneficiaries in a will as long as one of the joint owners is alive.
  • Life insurance and annuity benefits: These assets cannot be included in a will. The benefits of a life insurance policy or annuity are automatically passed on to the designated beneficiaries at the owner’s time of death.
  •  Proceeds from 401k and other accounts:  401k accounts, retirement plans, IRA’s and pensions all have a similar payout policy as life insurance: only those named as beneficiaries receive the funds after the death of the account holder.

What you should include in your will

After reading the above exceptions, you might be wondering what types of assets you should include in your will. The good news is the answer is fairly simple: all other assets. Generally speaking, any asset that is not automatically paid or distributed upon the death of the asset holder should be included in the will. If you are unsure of which assets you have, consider keeping a notebook that lists all your different assets to see which should be included and which should be left out. Keep this with you until you are ready to write your will. If you are unsure, you may seek the assistance of an experienced estate planning attorney to help you review your assets and decide what should be included in your will.

You do not need to wait until you have built significant wealth or assets to begin drafting your last will and testament. The Boutty Law Firm is a Central Florida law firm that has helped many families protect their wealth and assets through estate planning. We assist in the writing of wills, as well as other estate planning services, such a probate and estate administration. For more information on wills and to get in touch with an estate planning attorney, call our Winter Park office at 407-537-0543.

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5 Important Things to Do After Writing a Will

So you’ve decided to think ahead and plan for the future by writing your will. Congratulations, you’re much more prepared than most people who postpone writing a will until the last minute or forgo one altogether. But is simply writing a will enough? It might not be if you want your loved ones to be fully prepared and informed of your wishes. Here are some things to consider creating once you’ve completed the writing of your will:

  • A List of Accounts

Generally, a will can tell you how an individual’s assets and property are to be distributed once they die. However, a will can leave out a lot of information such as how to access the assets. Consider leaving a list of accounts that your loved ones will be able to access. Include things such as bank accounts, credit cards, mortgages, and personal loans.

  • A Password List

Few things will be as frustrating as realizing you’ve inherited an important financial asset but have no means of accessing it online.  Login names, pin numbers, e-mails, and passwords are all important parts of an online account’s security. Keeping a list of passwords and other sensitive information pertaining to your will is a smart move and your relatives will thank you for it.

  • Note of Investments

Like a list of accounts, the inheritors of your assets will want to be informed of whatever investments you have in your name. These can include stocks, bonds, annuities, life insurance policies, retirement assets, and other investments. If you have a broker or agency that helps manage your assets, be sure to include their contact information.

  • Funeral Plans

If you’re facing an illness, or simply want to have all the details of your funeral taken care of ahead of time, you can have specific instructions left to your loved ones for your funeral arrangements. You can even plan your burial, funeral, or cremation in advance. If you want to lift the burden off your loved ones, you can also set aside funds to cover your funeral costs.

  • Instructions For Your Will

Last but not least, it’s good to discuss everything with your family ahead of time and let them know you’re planning to have your will, investments, and other financial accounts prepared for when you pass on.  Give them instructions on where to find your will, your list of passwords and accounts, your funeral plans, and other important details. Explain to them what your wishes are and how you would like to have the assets of your will distributed once you pass on.  Being proactive in your will can help save your loved ones much stress and concern, and provide peace of mind to you that your desires are carried out in the end.

The Boutty Law Firm assists individuals in Central Florida prepare for their future with wills, probate, and estate administration services. Contact us for more information.  

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