Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Saturday, November 21, 2015

About Thirty-Five Percent Of Americans Are Wasting Their Inheritance

Pass it onOver the next five to seven years as much as $1.3 trillion in wealth is expected to trickle away as people mismanage their inheritance. This article discusses statistics that show that about 35% of Americans will waste their inheritance. A groundbreaking study on cross-generational wealth transfers conducted by Ohio State University researcher Jay Zagorsky shows that even when very large bequests are at stake most if not all of the money inherited usually ends up vanishing. Setting up small trusts using a process known as a pooled trust approach can be a good way to make wealth last a long time. A special purpose trust can be used to make sure funds are allocated to pay for important things like a college education. Instead of permitting the heirs to cash out their inheritance in one lump sum a person might want to make sure to annuitize the payments.

See Scott Martin, Easy Come, Easy Go: Why 35% of Americans Squander Their Inheritance, Trust Advisor, November 18, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 21, 2015 in Estate Planning - Generally, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

CLE On The Building Blocks of Wills, Estates and Probate

CLEThe Real Estate, Probate & Trust Law Section of the State Bar of Texas is sponsoring a CLE entitled Building Blocks of Wills Estates and Probate 2016 which will take place on Friday, January 29, 2016 from 8:30AM to 4:45PM central time, online. Here are some details about the event:

New and experienced attorneys alike with an interest in starting or developing their estate planning and probate practice will find this year's live webcast useful to their practice. Our distinguished group of speakers who are experts in their field, will discuss the best solutions to many of the legal issues and practical problems that practitioners in this area will encounter daily.They will answer any questions you email in during the live webcast. Also, invaluable reference materials are included that will keep you and your practice current on the basics of estate planning, probate, Medicaid and practice management.

If you are unable to watch the live webcast on January 29th, video replays will be held in various cities in February and March, with a webcast replay on March 9th. The entire seminar will be archived later as an online class available on demand.

November 21, 2015 in Conferences & CLE, Estate Planning - Generally, Wills | Permalink | Comments (0)

Friday, November 20, 2015

Inheriting A Home From A Spouse

Long-term care insuranceIn this financial advice column a married woman asks if she would automatically inherit her husband's home if he died before her. The laws governing inheritance and probate issues can be complex and whether a spouse will inherit a piece of property often depends on the individual situation. A person would need to know if their spouse had children from a previous marriage. If there are children from a previous marriage then a married couple might want to have a “quit claim” deed that would add the spouses name to the deed and would ensure that they inherit the property. Another technique involves naming the spouse as a beneficiary of the marital home. There are many different types of disputes that can arise in probate and that is the reason why it is important to speak with a professional about creating an estate plan.

See Quentin Fottrel, Will I automatically inherit my husband's house?, Market Watch, November 20, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 20, 2015 in Estate Planning - Generally, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

Including A Heritage Statement In An Estate Plan

Heritage statementIt is a common theme in human behavior for wealth to disappear within three generations. The first generation often creates the wealth through hard work and thrift. Then the second and third generations in a family will often spend everything until there is nothing left. Having a good estate plan is often not enough to preserve family wealth through the generations. Along with a monetary inheritance senior generations need to put more time and effort into providing their heirs with an educational inheritance as well. Heirs need to be taught the money management skills and the work ethic that allowed the first generation to build and keep the wealth in the first place. A heritage statement is a formal document that can sharpen a families’ vision about the priorities that they need to have. This column provides resources on how people can learn more about heritage statements.

See Why Should I Consider Including a “Heritage Statement” as Part of My Estate Planning?, The Law Offices of Kyle E. Krull P.A., November 19, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 20, 2015 in Estate Planning - Generally, Estate Tax, Income Tax, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

Estate Planning Issues Millennials Should Think About

MillennialYoung adults that are part of the Millennial generation have very distinctive estate planning needs. Discussions between Millennials and their parents about estate planning will be very important over the next 30 years as over $30 trillion in wealth is transferred from one generation to the next. Millennials need to carefully think about their own situation and what their goals are and then develop the right estate plan that suits their individual needs. Communication with family members and loved ones is also essential. It is a good idea for people to think about what sort of inheritance they might be expecting to receive and then plan accordingly.

See Ashley Thompson, Estate Planning Considerations for Millennials, Wealth Director, November 17, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 20, 2015 in Estate Planning - Generally, Estate Tax, Gift Tax, Income Tax, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

Article On The Rise of Statutory Wills

ArticlePictureRosie Harding  (Professor, University of Birmingham - School of Law) recently published an article entitled,The Rise of Statutory Wills and the Limits of Best Interests Decision‐Making in Inheritance, The Modern Law Review, Vol. 78, Issue 6, pp. 945-970, 2015. Provided below is an abstract of the article:

This article addresses ‘statutory wills’ executed under the Mental Capacity Act 2005 (MCA) for persons with impaired mental capacity. The article provides an overview of the historical development of statutory wills, before exploring their rising contemporary significance. It considers the shift from the previous ‘hypothetical substituted judgment’ test to the contemporary ‘best interests’ orientation of the MCA. The article assesses the problems that the best interests approach raises in this area, and its (in)compatibility with the right to equal recognition before the law under the UN Convention on the Rights of Persons with Disabilities, arguing that the pervasive reach of best interests in contemporary mental capacity law requires reconsideration. The paper concludes by suggesting that a more limited framing of the power to execute statutory wills is required in order to appropriately balance the rights of individuals with disabilities with practical considerations around the distribution of assets on death.

November 20, 2015 in Articles, Wills | Permalink | Comments (0)

Some Considerations To Keep In Mind When Choosing An Executor

WillsOne of the most important decisions a person has to make when creating a will is choosing who will be the executor of the estate. Often times, the executor chosen is a friend or family member who might not be in the best position to fully appreciate the duties that will be imposed. For example, failure to properly supervise distributions from the estate could leave it short to pay off creditors which would leave the executor on the hook for the money. In addition, pressure from heirs to start taking items from the estate could lead to problems when people get upset that they are not getting what they view as "theirs" quick enough. As a result of these and other potential problems, it is always a good idea to chose someone that is level headed when managing their own affairs and will not easily be bullied into taking actions that are problematic. If the preferred candidate does not fit that bill, then it is better to find a new person rather than risk fallout that a poorly chosen executor could create.

See Victor Ngai, Helping Your Clients Avoid Common Executor Mistakes, Financial Advisor, November 19, 2015.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

November 20, 2015 in Estate Planning - Generally, Wills | Permalink | Comments (0)

Thursday, November 19, 2015

What Happens To Debts When A Person Dies?

Dying debtsOne estate planning issue that many people might want to think about is how any debts they have will impact their estate after they pass away. When a person dies their debts are generally paid out of their estate. If the estate does not have any money then the debt typically dies with the person. An exception to what this article refers to as a dying debt that dies with a person is an undead debt that can exist if a person was a co-signer or guarantor of a loan. During life it is practically impossible to get out of any student loan debt but when a person dies the debt tends to die with them. This article discusses certain steps that people can take to protect their estate from debts.

See Patrick Chism, What Happens to Your Debt When You Die?, Zing!, November 19, 2015.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

November 19, 2015 in Estate Planning - Generally, Intestate Succession, Non-Probate Assets, Trusts, Wills | Permalink | Comments (0)

Estate Planning Advice For Professional Athletes

Professional athleteOne crucial requirement when engaging in estate planning for professional athletes is mutual respect. Successfully advising a professional athletes is different from advising a regular client. Oftentimes professional athletes might be surrounded by “yes men” who will give them bad advice. Sometimes a professional athlete might have little to no experience with handling large sums of wealth which can make them vulnerable to making poor financial decisions. An adviser should be aware of these issues that professional athletes might face and should be mindful of an athletes individual circumstances. Not every athlete will react the same way with money so it will be necessary for advisers to craft an individual estate plan that is unique to that athlete’s circumstances.

See David H. Lenok, How to Advise Professional Athletes, Wealth Management, November 18, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 19, 2015 in Estate Planning - Generally, Sports, Trusts, Wills | Permalink | Comments (0)

Talking About Estate Planning During Thanksgiving

Turkey talkWhen families gather together for Thanksgiving the event can present a great opportunity to talk about estate planning. Discussing estate planning issues with loved ones can be uncomfortable, but putting off these important talks can lead to dire consequences down the road. The holiday season presents a great time to discuss these issues because it is one of the few times in the year when families and relatives that are often spread out across the country are gathered in the same place. Family members should be told ahead of time that these discussions about estate planning are going to take place so that the issue is not sprung on them by surprise. If people are not comfortable discussing these issues during Thanksgiving then it would be a good idea to plan a time in the year when families can get together to work out an estate planning strategy.

See Have “The Talk” This Holiday Season, Idaho Estate Planning, November 18, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

November 19, 2015 in Estate Planning - Generally, Food and Drink, Intestate Succession, Trusts, Wills | Permalink | Comments (0)