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Cherry Hill NJ Probate & Estate Administration Law Blog

Understand how trusts can benefit your loved ones

Trusts are one of the estate planning tools you have available when you need to pass assets down to your loved ones upon your death. There are many benefits to establishing trusts instead of just outlining everything in your will. One of these is that the trust provides some measure of privacy since it doesn't have to go through the probate process.

Once you decide that you're going to set up trusts, you have to determine what type. In order to do this, you must think about what the purpose of the trust will be. For example, a special needs trust can pass assets to a person who is on needs-based assistance programs because the trust's assets remain in the trust and aren't directly passed down to them. Additionally, the wording in the trust will exclude it from being used as a primary means of support for the person.

Do you know who's entitled to an inheritance?

It's common for individuals to confuse the words heir and beneficiary. This is especially the case if an executor has been tasked with handling their first New Jersey estate administration case. There is a difference between the two terms though.

An heir is someone related to a deceased person. If the person dies without a will, then they are legally entitled to receive a portion of the person's estate. Someone is said to have died intestate if they hadn't yet sat down and drafted a will at the time of their death. A decedent's estate is subject to intestate succession laws in such instances.

Financial exploitation can lead to estate plan challenges

Some unscrupulous individuals will prey on older individuals to try to get the elder person to add them into their estate plan. This is a form of financial exploitation that can impact what the beneficiaries and heirs receive when the person passes away.

The people who try to do this count on the fact that the person might not have their full mental capabilities about them. They use this to their advantage and often try to become best friends with the elderly person. There are many ways that they might try to have the person take care of them financially.

Know when to make changes to your estate plan

Your estate plan is the key to what is going to happen to you and your assets. It includes some end-of-life plans, such as the advanced directive, and your will and trusts. Many people think that once they create the plan, they won't have to do anything else with it. That misconception can prove costly in the future.

It's a good idea to periodically review your estate plan to ensure that it still reflects your most current wishes. You can do this every year or two. You also need to check it if you have some major life changes.

Talking about your parents' estate plan

Talking about an estate plan isn't something that's easy. Instead, it takes time and compassion to have these discussions. If you want to discuss their estate plan with your aging parents, remember that this might not something that they can easily or quickly. In some cases, they may dodge the questions you have because they haven't made an estate plan.

Only around 42% of Americans have a will set up. The individuals who don't have one are leaving everything up to chance. They aren't letting anyone know what their wishes are for their assets. Instead, they are letting the state's laws dictate what happens.

Administrators should know how heirs and beneficiaries differ

Many people tend to use the terms "heir" and "beneficiary" interchangeably, but these are actually very different terms. It is important that people who are handling the estate administration duties understand what the differences are, so they can use the proper terminology as they handle the estate.

For the purpose of estate planning, an heir is a person who is listed in the intestate succession laws. These are individuals include the spouse, children and other family members.

Young adults should think about the future

All adults should have an estate plan in place just in case something happens to you. The problem is that many young adults think that they have plenty of time to create their plans so they don't take action. While they might be right, there is still a chance that the worst could happen. Then, their loved ones are left without a plan.

The process of creating an estate plan must be personalized. Everyone can't use the same template because every situation and circumstance is different. For example, a person who is single will have a much different estate plan than a person who is married and has children.

How is testamentary capacity defined?

One of the first steps that the executor of an estate must take when a testator dies is to round up their will to take and file it with the probate court in the county in which the decedent lived. It's often not until this happens that you, as an interested party, are made aware of the contents of your loved one's will. If you're unhappy with what it says, then you may be able to contest their will.

Wills can generally be contested if someone engages in fraud. This often happens in one of two different ways.

Small business owners must create a solid estate plan

When your small business is dependent upon you for daily actions and activities, you need to ensure that you have a plan in place just in case something happens to you. A business that is dependent on an owner will likely go under if that owner passes away suddenly. This can mean a tragic outcome for your company, and it might also be a tragedy for your family members if they're counting on the company for income.

One of the most important steps you can take is to have a succession plan in place. This provides the steps your company will take in order to transition it to the new normal. You have to determine whether you are going to transfer the company to another person, such as a family member, or whether you are going to have it sold to an outside entity. No matter which plan you set, you must ensure that there are instructions for how the company will run in your absence.

Determining whether an estate must go through probate or not

When you have a loved one who is writing an estate plan, they have to determine who is going to administer it. The person they name must be able to make decisions based on the current laws and the wishes of the creator. This isn't always easy, but making sure the person understands their duties is imperative.

If you are the person who is chosen as the administrator of the estate, you should ensure that you understand what duties you have. One of the important designations here is that you only have to deal with probate assets. These are things that are controlled by the contents of the will.

Law Offices of Nancy M. Rice
Representing clients in Ocean City and communities throughout New Jersey.

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