How to Avoid Challenges in Your Will or Trust

Why You Need To Do A Trust For Your KidsIf you have been listening to my radio shows or podcasts, and reading my blogs, you will know that I have focused a lot on estate planning for retirees, or soon to be retirees, and how to protect their stuff and their family from the issues that they face. These include care costs, eventual probate expenses and taxes. For most of my career I have been dedicated to working through those issues. In fact, my law firm exists because I watched my own grandfather go through all of this money paying for care. Sadly he was battling Alzheimers disease and spent many years in a nursing home. Having spent so many years working on elder law issues, weve become to know how to properly plan for these issues. Working With Young FamiliesRecently weve been working with folks from a young family demographic. My wife and I recently redid our own personal estate plan because our children are getting older, and there are changes in our financial situation too. It is necessary every few years to see if our estate plan does what we want it to do. Most of us learn from our experiences and the situations we find ourselves in, and how to respond the next time. Thats one of the one of the great things about life because we get to learn from mistakes and challenges. Ive been through some challenges with some families that are similarly situated to mine, when has thrown them a curveball. Many of them have had to deal with injuries, disabilities and deaths, as well as unexpected situations. This has made me realise the importance of needing to plan when it comes to younger families. We actually have an entire webinar series for younger families, called Five Secrets to Protect Your Family. We teach you the things you need to know to protect your kids from the cradle to college. Raising Good HumansAs parents of young children, I think our primary job is to raise good humans who will be happy and self sufficient. Hopefully they will find careers that theyre passionate about and a spouse they love and are happy with. Eventually they will have their own kids and it is my job to prepare them for that. I think we also need to accept that our duty of raising good humans who will outlive us, is something we need to plan for too. We need to also face the reality that although it would be devastating if both parents passed away suddenly, there needs to be plan in place for the kids to be taken care of.A Simple Will Is Not EnoughUnfortunately, most young parents of young kids dont actually plan for this. Most young families only have a will which will name who gets the stuff when they pass away. Most young families often dont have many assets, so it is important for them to buy life insurance. You would definitely need life insurance or a retirement account. While it is not enough to only have a Will, it can be used to do some planning. You would need to name an executor who will administer your estate, and guardians for your kids. A guardian would essentially step into your shoes if you pass away. However, guardianship ends when your child is 18 years of age. While they are considered an adult at age 18, leaving money to your 18 year old could be a big mistake for many reasons. I know that people will advise you that you only need a simple Will, which states that everything is left to your spouse and then to your kids. If your kid is a minor when they inherit money, your kid will get their money in a Uniform Transfer to Minors Act Account. This means that somebody else would be in control of the money, until the kid turns 21. However, after the age of 21, your kid is on their own. If I think about it, if at the age of 21 I had been left an inheritance of a million dollars, I would not have make good decisions with spending the money. I dont believe most 21 year old kids would know what to do either. This illustrates why it is not enough to just have a Will, and why one needs to plan for all eventualities.Why You Should Create a Trust for Your ChildI would encourage you to create trusts. The Trust has certain terms and conditions to determine what will happen with the money. Wills have to go through probate which is the court administration process for administering the Will. What happens when somebody passes away with a Will, the executor cant do anything until the judge allows him and it becomes a court process. The Will is then mailed to the beneficiaries, with details of what theyre allowed to have. This can take weeks or months to find out what the deceased owned. The probate process is a time consuming task and also expensive, and we advise to avoid it if possible. This is exactly why we suggest using a trust.Divorce is a Financial ThreatRather than giving the money to your kids outright, the money is held in a separate trust until they reach the age which you determine is suitable. This is known as an underage trust and it protects the kids from their own poor decisions as a youngster. When your child reaches the age you have agreed upon which is often 25 or 30, for them to receive their inheritance, the trust then terminates. However, you need to consider protecting your kids from the next potential issue and the biggest financial threat for adults in their 20s and 30s, which is divorce. What I like to do is for my kid to become a trustee on the trust. Were not distributing the money so it doesnt become a marital asset. It would also be protected from the general creditors, divorces and lawsuits. The money is held in trust for my kid until they turn 25 and can get control of the trust. This is effective estate planning and is more important than having a simple Will. It often happens that most people just do beneficiary designations on their life insurance policies. When the parent passes away, the kids get their money on their 21st birthday. This is not a good idea and it is better for that money to be in a trust. Having a good estate plan in place helps you to do your job as a parent and raise good people.Register for our Webinar for Young Families This is all possible when you start with education because educated decisions are better decisions. Thats why we offer a free webinar called Five Secrets to Protect your family. You can find it sechlerlawfirm.com/workshops. We teach you a lot of the things you need to know about how trusts work. We also share other important information you need to know. Join us!

A Last Will & Testament, commonly referred to as a Will, is a legal document that expresses a person's wishes regarding the distribution of their assets and the management of their affairs after their death. It serves as a written record of how an individual wants their property and belongings to be handled, including who should inherit their assets, who should be appointed as guardians for minor children, and any other specific instructions they may have regarding their final wishes when they are gone.  Many people confuse a Will with a Living Will which is a much different document that takes effect while you are alive!  Here in Florida, it generally covers three conditions and states that if you have: a terminal condition; end stage condition; or if you are in a persistent vegetative state, where in the opinion of two doctors, there is not reasonable medical hope of recovery, that you do not want to be kept alive by machines.  Again, a very different purpose than your Last Will & Testament. The main purposes of a Last Will & Testament are:Asset Distribution: A Will allows individuals to specify how their property, such as real estate, investments, bank accounts, personal belongings, and other assets, should be distributed among their beneficiaries or heirs. Without a Will, the distribution of assets typically follows the laws of intestacy, which may not align with the deceased person's preferences.Guardianship designation: If the deceased person has minor children, a Will can designate a guardian who will be responsible for their care and upbringing. This allows parents to have a say in who will be responsible for their children's well-being if they pass away and not leave it solely up to a judge with no input from them.Personal Representative Appointment: A Will typically appoints what is referred to in Florida as a personal Representative.  Other states call the persona and Executor.  This person is responsible for ensuring that the deceased person's wishes, as outlined in the Will, are carried out. The Personal Representative manages the administrative tasks, such as paying outstanding debts, filing tax returns, and distributing assets according to the instructions provided in the Will.Avoiding potential conflicts: This is a big issue, especially in situations where there is a second or third marriage involved and there are children from a prior relationship.  A well-drafted Will can help minimize conflicts among family members or other potential beneficiaries, as it provides clear instructions on asset distribution and removes ambiguity. To be legally valid in Florida, a Will requires certain formalities, such as being in writing, signed by the testator (the person making the Will) and witnessed by two witnesses.  Also it is best to have the testators signature and the witnesses signatures acknowledged by a Notary Public.  This makes the Will a self-proving Will which avoids the necessity of having to find the witnesses when the testator passes.Will ContestsContesting a Last Will & Testament means challenging its validity or certain provisions within it. There are a number of grounds on which a Will can be contested in Florida. Some of the typical reasons for contesting a Will include: Lack of testamentary capacity: This refers to the testator's mental ability to understand the nature and significance of creating a Will. If it can be demonstrated that the testator lacked the necessary mental capacity at the time of creating the Will, it may be deemed invalid. Factors that can affect testamentary capacity include mental illness, senility, or undue influence.Undue influence: If it can be proven that the testator was coerced, manipulated, or unduly influenced by another person when creating the Will, it may be contested. Undue influence typically involves someone exerting pressure on the testator to make decisions against their own wishes or best interests.  It is often a caregiver who cuts off outsiders from contact with the testator.  It can be a child, a spouse, a home health aid of trusted advisor.Fraud or forgery: If there is evidence to suggest that the Will was forged or that fraud was involved in its creation, it can be contested. This may include situations where someone impersonates the testator, forges their signature, or makes fraudulent changes to the Will.Improper execution: Wills must generally meet certain formalities to be considered valid. If the Will was not properly executed according to the legal requirements of the jurisdiction, such as lack of witnesses or failure to sign the document correctly, it can be contested.  This often occurs when someone tries to use a do it yourself Will kit.  While DIY may be good for home improvement projects, it is best to consult professionals when planning to disburse your hard-earned assets.Mistake or ambiguity: Another problem with DIY Will kits are mistakes or ambiguities in the Will that make it unclear or open to interpretation.  In such cases it may be contested. This can occur when the language used in the Will is vague, contradictory, or inconsistent, leading to disputes among beneficiaries.Revocation or subsequent Will: If a more recent Will is discovered that explicitly revokes or replaces the previous Will, the newer version may be contested based upon all of the grounds discussed above.It's important to note that contesting a Will can be a complex legal process, and the specific grounds for a challenge must be explored thoroughly as a Will contest is expensive and time-consuming as well as very difficult to win.  That is why your best course of action to avoid this for your family is to work with a team of professionals, including your lawyer, investment advisor and accountant, to develop an estate plan that best fits your intentions, and prepares you and your family for when life happens.

Estate Plan Check-UpsEffective estate planning is personal, and its more than just deciding who to leave your assets to once you die.  Effective estate planning  is a comprehensive process that encompasses pre-need planning: health care decisions, financial management, and maintaining a delicate balance between independence and security.  Like your preventive doctor visits, you should regularly check in on your estate plan to ensure it fits your current needs, considers and plans for potential future care needs, and will give effect to your wishes now and in the future. Generally, estate planning involves creating a last will and testament, possibly a revocable trust, possibly an asset protection trust or a supplemental needs trust for a loved one who is unable to manage finances or may be vulnerable to abuse or exploitation.  Estate planning also involves important advanced directives, such as a durable financial power of attorney, a health care power of attorney, and a living will.   Creating an estate plan, or getting my affairs in order, tends to be an item on our to-do lists, for us to get done and move on to the next thing. However, while it may not be something you have to look at every month, or even every year, once your initial estate plan is completed, it is something that needs to be reviewed with some regularity.Most people get an annual physical when they are healthy, not when they are sick. They do this because they want to proactively spot any issues that could cause them to become ill in the future. The same concept can and should be applied when it comes to reviewing and updating your estate plan. Your estate plan may be healthy now, but you want to make sure that it stays that way by checking it regularly, to ensure it fits your needs and family circumstances, protects and provides for you now, and  accomplishes your goals and wishes in the future. Editors Note: This article is for informational purposes only and is not intended to be legal advice.  This article was submitted by Ashley Day, Esq.  Ashley Day Law, LLC.  Reach her at 251-277-3377.