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San Diego Probate & Estate Administration Law Blog

An out-of-date estate plan can lead to disputes

It is not enough just to have an estate plan. You need to make sure that it is actually up to date. This is a constant process. Writing a will and then forgetting about it for 10 years does not help anyone. Your assets could change significantly in that time.

For instance, people now have far more digital assets than they used to control. Some are digital products, like movies and books. Others are digital forms of money, such as bitcoin. Some are just things that, though not really valuable at all, have a sentimental value for your family. Examples could be all of those pictures that you keep online.

Why even careful people put off estate planning

Most people put off estate planning. In fact, most people don't have a will.

If you think about it, you may assume that people without their documents in line are reckless individuals who like to take chances. They know they're going to pass away, after all, and they know they cannot predict when it will happen. Not doing estate planning, then, is quite a gamble.

Many older Americans still have a mortgage

Here's what people assume, based on the traditional model, is going to happen when someone does their estate planning: They'll pay off the mortgage, retire, live in the home without payments until they pass away and then leave the home to their heirs debt-free.

This is what people often strive for, and it's what does happen in many cases. However, some statistics show that a lot of people are going to pass away while they still have an outstanding mortgage.

A trust can protect money for the future

If you're thinking about putting money in a trust fund for your children, you probably want to control how you give it to them. For instance, maybe the trust will set it aside for educational costs or maybe it will pay out when they hit a certain age.

There are a lot of important benefits to a trust fund, but there's one thing to consider when creating the trust long before you pass away: It can also protect that money since it's no longer legally yours. It belongs to the trust.

Limit family strife with an estate plan

It's easy to think that estate planning is all about you or all about your financial assets. While it does start with these things, it's actually all about your family. It may have a bigger impact on them than you realize.

For instance, those who do not have an estate plan run the risk of pitting their heirs against one another, possibly in court, if they do not agree on how to split up the estate. If one person gets an asset that someone else wanted, it can lead to resentment that lasts for life. Children may argue and fight so much that they never talk to one another again.

Should you challenge a will?

When an estate plan gets to probate court, you may want to challenge the will. The most common reason for a challenge is that a family member thinks the will is inaccurate. It does not describe what a loved one believes the deceased person wanted.

Deciding to challenge a will in probate court is a big deal, though. It can take time. It can be stressful for the family. If not everyone agrees with your decision, they may feel like you are attacking their position or threatening their assets.

Do you want to use a 'Do Not Resuscitate' order?

A Do Not Resuscitate (DNR) order tells medical professionals that you do not want them to utilize any aggressive measures to save your life. Medical care itself is fine, but if you pass away, you want them to stop short of attempting to bring you back. This can be an important part of your estate planning, along with documents like a health care advance directive.

Should you use a DNR order? Obviously, that's a very personal choice and whatever you decide is perfectly fine. That said, it is worth noting that many doctors actually have DNR orders, and some studies have found that about 80% of people claim they do not want doctors to use aggressive measures. Reasons they give include:

  • The medical care can be invasive and painful.
  • Efforts to bring you back and care for you afterward can be incredibly costly for your estate and your family.
  • You may see your quality of life massively decline, even if doctors technically do save your life.

After a spouse's death, put off big financial decisions

If your spouse passes away, you know you may have some big financial decisions to make. This could include doing substantial estate planning to alter the plan in light of your new situation.

For instance, perhaps your estate plan included setting assets aside to make sure you can cover your medical bills. You may need to use this money to pay the costs for your spouse, which were incurred before they passed away, but then you have to reconsider your financial position and plan for your own future. What expenses might you face? Are you prepared? Have you updated the will now that you're the sole owner of the family's property? There are many questions to ask.

Do a high percentage of wills get challenged?

Your last remaining parent passes away. You know that they did their estate planning, but you also worry that you and your siblings will not see eye-to-eye regarding that plan. You've never really gotten along as adults, and you fear that they'll try to challenge the will almost no matter what it says.

For instance, maybe you live close to your parents, while they live on the other side of the country. You worry that they'll accuse you of using undue influence, manipulating your parents to alter the estate plan.

It's (almost) never too late to do your estate planning

You have probably heard people talk about how it's never too early to do your estate planning. You don't have to put it off until you retire. Even if you're in your early 20s, it wouldn't hurt to get an estate plan in place. After all, accidents take lives every day. You can't count on surviving into your 60s or 70s, when people traditionally start thinking about estate planning.

But is it ever too late to do your estate planning?

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