By Libby Banks, the Law Office of Libby Banks, PLLC
There is lots of confusion about estate planning, what wills and trusts do, and what the law provides. Let’s bust a few of those persistent myths!
Myth 1: My will transfers my property to my heirs at death.
Wrong! Your will is a document that tells the court who to appoint as your executor and to direct the executor where and how to distribute your assets. A will alone won’t deed your house to your children or cause your bank to give the funds in your bank account to your heirs. Instead, before your executor can even touch these assets, they are forced to file paperwork with the court to start the probate. Then they must file reports with the court as they take care of your estate. This probate proceeding is expensive and time consuming – and it means that your will and anything else filed is now available for the public to see.
Myth 2: Estate Planning is not necessary unless I am old or rich:
What we mean when we say “estate planning” is planning for your assets – whether you have a lot or a little. Even your 18-year-old has an estate – a bank account, the paycheck their employer owes, their laptop, car, and other personal property. Your “estate” is simply what you own. If you don’t prepare any plan, the state of Arizona has dictated what happens. It will likely also require probate, and it may not result in who you want being in charge, and it may not dispose of your assets the way you would like.
The truth is, if you have assets, you should have a written estate plan. It may not be as elaborate as Bill Gates’ plan or be used as soon as your 90-year-old grandfather’s plan, but it is still important to have a plan you put together.
Myth 3: A revocable living trust is too complicated for my simple estate:
The revocable living trust simplifies things. It’s easy for you to use, and for someone else to assist you if you need help managing your finances during your life. That’s right – the revocable living trust operates to help you during your life and not just at your death. During your life, you own your property in the trust, but you still own everything, and file taxes just the same as always. You have complete control over your assets, just as you did before. But if you become disabled or incapacitated, your designated successor trustee can step in to help you, and on your death, the successor trustee distributes your property without any court involvement and distributes it the way you have directed in your trust. The revocable living trust is an easy way to provide for the future while maintaining control over your assets.
To find out more, book a free consultation with us or check out our website. Call 602-375-6752 or go to libbybanks.com.