Is Your Estate Planning Up To Date?

Take this simple test to see if it is.

1. Have you prepared a will or a trust?

   Don't Know     No     Yes

   Without proactive planning, you are relying on the Virginia legislature that meets in Richmond to determine how your assets pass, to whom they pass, and when they pass.  In addition to having potentially undesired results, this is perhaps the most costly and time consuming means of passing your assets to your loved ones

2. If you have done a will or trust, has it been reviewed in the last two years?

   Don't Know     No     Yes

   Even assuming that there have been no family or financial changes since your plan was last reviewed, there have been major tax law changes in 1997 and in 2001. An out-of-date estate plan is perhaps worse than no estate plan at all. Our experience is that people view estate planning as an event rather than a process. Keeping your plan current is vital to achieving the goals you set out to accomplish

3. Are all of your heirs over the age of 21 and financially responsible?

   Don't Know     No     Yes

   Under Virginia law, children inherit property no later than age 21 without restriction. Proper planning is crucial to prevent an heir from squandering his or her inheritance, or worse, from causing harm to himself or herself.

4. Are you absolutely certain that your assets will not be subject to probate?

   Don't Know     No     Yes

   We encourage you to make a list of each asset you own and identify how each asset is going to avoid probate. Assets owned as “joint tenants with rights of survivorship,” assets owned in the name of a trust, and assets that pass by beneficiary designation (such as IRAs, life insurance, etc.) will avoid probate. Everything else is subject to probate. (Also, note that assets owned jointly are typically subject to probate upon the death of the last joint tenant.) Probates can be costly and typically require twelve (12) to eighteen (18) months from the date of death to conclude.

5. Do you have assets other than bank accounts titled jointly with a child or children, or someone else?

   Don't Know     No     Yes

   Holding assets jointly with someone other than a spouse is quite common, but has some potentially devastating consequences of which most people are unaware. Joint tenancy cannot help if your children need help in managing their property.There is no provision for disability or mental incapacity management, either temporary or permanent.Remember, the well spouse will not be able to reach the jointly owned asset alone. Most often, a court intervention will be required. If your child becomes disabled, joint tenancy property may be tied up in a “living probate” while you desperately need it for your care. Additionally, problems can be created if joint tenants die in the wrong order.

6. Does your current plan provide your heirs with asset protection, divorce protection, and lawsuit protection?

   Don't Know     No     Yes

   The most common means of providing for heirs is with outright distributions. By doing so, however, the inheritance becomes subject to the creditors of your heirs.

7. Is this your first marriage?

   Don't Know     No     Yes

   Second or subsequent marriages present unique planning issues, particularly if both spouses have children from a prior marriage. Proper planning is critical to prevent undesired results.

If you’ve answered “No” or “Don’t Know” to any one of these questions (or “Yes” to No. 5), you need to contact our office to schedule a time to meet and discuss your responses, the consequences of not taking action, and potential solutions to these and other issues. To start the planning process visit our Getting Started Web page. We hope to hear from you and look forward to serving you.

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