Frequently Asked Estate Planning Questions
Preparing an estate plan in North Carolina can seem overwhelming, and many Americans do not have a comprehensive estate plan in place. Many questions come up during the estate planning process when our lawyers meet with clients to create their estate plans. We have compiled a list of some of the most frequently asked estate planning questions below:Why Do I Need an Estate Plan?
One of the most important reasons to create an estate plan is to dictate who will inherit your property. Who do you want to receive your assets after you are gone? Do you want to place any conditions on inheriting your property? If so, you need an estate plan. If you die without an estate plan, your assets will be distributed according to North Carolina’s intestacy laws.
Under these intestacy laws, a person you may not have chosen could receive some or all of your assets. Additionally, your money will be tied up in the probate process while the court decides how to distribute your assets according to their intestacy laws. The best way to ensure your wishes are followed and your estate is distributed in a timely and cost efficient manner is to work with an estate planning lawyer to create an estate plan that works for you. Every estate plan is as unique as the person creating it. Discussing your unique situation with an estate planning attorney is the best way to ensure your goals are met.What Does Probate Mean?
Probate is the court-supervised process through which the court gives a person, called an executor, the authority and power to manage an estate, either in accordance with an estate plan or through intestacy. The executor typically begins by identifying all of the assets of the deceased individual’s (called the decedent) estate. After the court identifies the decedent’s assets as well as the relevant creditors and beneficiaries, the court will distribute the assets accordingly. Whether you have a last will and testament or not, your estate will go through the probate process.What is the Difference Between a Trust and a Will?
A last will and testament is a legal document in which you state how you would like your assets to be distributed after your death. Under North Carolina law, your will must meet certain legal standards to be valid. For example, you must be mentally competent to understand the terms of your will when you sign it. After your death, the probate court will execute your will and distribute your assets according to your will. If there are challenges to your will, the probate court will oversee them.
One way to bypass the probate process is to place your assets into a trust. When you pass away, your assets will transfer automatically to beneficiaries through the trust, avoiding the probate process entirely. The probate process can take anywhere between a few months and a year or more. When there are challenges to the will or other legal challenges, the probate process can take even longer. Probate can also be incredibly expensive, especially when litigation arises. There are many different types of legally valid trusts in North Carolina that you can utilize to avoid probate.
You can choose to create a revocable or irrevocable trust in North Carolina. Revocable living trusts are created during the creator’s lifetime. If you create a revocable living trust, you have the power to change the terms of the trust or even revoke the trust altogether during your lifetime.
Revocable trusts are useful for avoiding the probate process, but they do have some drawbacks. Creating an irrevocable trust is often a better way to protect your assets from creditors and ensure that you can qualify for Medicaid or other benefits. However, you will not be able to revoke an irrevocable trust during your lifetime. An estate planning lawyer will help you determine the best type of trust for your unique circumstances.Do I Need to Create a Will?
If you do not have any estate planning documents, you should consider creating a will as soon as possible. At Arnold & Smith, PLLC, we can help you create a legally valid will. If you would benefit from creating a trust, we can help you create a trust-based estate plan as well. The sooner you speak with an estate planning lawyer, the better.Contact an Estate Planning Lawyer Today
The best way to get your questions answered is to speak with an estate planning lawyer. At Arnold & Smith, PLLC, we offer estate planning services in Charlotte, Mooresville, and Monroe. Contact us today to schedule your initial consultation.