Why your “will” isn’t good enough.

If you signed a “simple will”, read on to see why there may be a better way.

People are often surprised when I tell them that their will is a ticket to court. The common misconception is that a will is all you need.  If you own, say a: house, car, bank account, some jewelry, and guns, and you are planning for your will to control their disposition, you may be unintentionally creating more work, more expense, and more drama for your loved ones. 

 Assets that aren’t owned jointly with another person and don’t have a beneficiary designation become probate assets when the owner dies.  In South Carolina, when someone passes away, if they don’t have a will, their probate assets go through the court process (which normally takes about a year) and are distributed to their heirs.  Your heirs are who the state of South Carolina says they are.  Right now, and very simplistically, the law says it’s your spouse and kids.  If none, then your parents.

 So why does this matter?  If you don’t want the state to decide by default who is in charge and who gets your stuff, then a will gives you some ability to state your wishes. The problem is there are a plethora of ways in which your intentions can be thwarted.  Even a quick reading of the general provision that probate assets pass according to a person’s will should be enough to make to make anyone skeptical. The person named as the Executor, now called a Personal Representative, must be appointed by the court, qualify, and be issued letters. Potential creditors of the decedent are given ample opportunity to present claims against the estate. Heirs who are supposed to receive nothing are nonetheless given notice of the will and an opportunity to get involved.

 This is why a “will” isn’t good enough.  Contrast jumping through all the probate hoops with quick, efficient, and thoughtful administration under a trust. Assets that are properly titled in a trust prior to a person’s passing will COMPLETELY AVOID PROBATE. Trusts can have creditor protection. Trusts can protect assets for people with special needs.  Trusts can hold and use assets for minors. Trusts can be used to avoid probate in multiple counties or states. Trusts can significantly shorten the administration timeline.  And the list goes on and on.

 So what’s the catch?  A well-crafted estate plan centers around the “plan”. Trusts are just a tool to make things easier and more efficient, but the pieces of legal paper mean very little if there isn’t a comprehensive plan making it all work.