No one wants unnecessary court involvement in their life. But without careful and proactive estate planning, chances are that some aspect of your estate will end up being decided there.
Here are two of the most common ways court proceedings can make their way into the management and distribution of your assets, along with the estate planning measures you can take to avoid them.
Note: If you want to brush up on the basics of Georgia estate planning (Wills, Probate, Power of Attorney, Revocable Trusts, Irrevocable Trusts and Advanced Healthcare Directives) take a look at these free ebooks.
If you experience an inability to make decisions on your own behalf, also known as legal incapacity, and you don’t have provisions for what to do in this situation clearly outlined in your estate plan, it falls upon the Probate court to decide who will become responsible for handling your finances, lifestyle, and medical care. You can become legally incapacitated because of an accident, injury, or degenerative illness. In the case of guardianship and conservatorship (sometimes called “living probate”), your estate’s details, as well as discussion about your medical conditions, may be made public and be the topic of court proceedings.
How to avoid it: To make sure the government doesn’t get involved in your wealth management and health care during your lifetime, you need to determine who will be your power of attorney. You can appoint financial and medical powers of attorney (known as the Advance Directive) for various categories of management in your life and estate. A solid long-term care plan, Advance Directive, and fully-funded revocable trust are also crucial components in avoiding living probate proceedings.
Probate is the name for the court proceeding that takes place after your death to prove that your will is valid and that its terms are carried out accurately and legally. I’ve written extensively about the probate process and you can read more details by clicking here. Probate brings your financial and personal affairs out into the open via public forum, and your estate can dwindle due to legal fees incurred during this time. It can also take an excessive amount of time due to the slow nature of court proceedings, dragging out a potentially stressful episode for your family.
How to avoid it: Having a will does not avoid probate, since all wills must go through probate to be validated. Although you’ll often hear about joint tenancy, beneficiary designations, and other probate avoidance options as alternatives to wills, only a fully funded revocable trust can consolidate the management and preservation of all types of assets. So, the best way to avoid probate is to work with your estate planning attorney to establish and fully fund a revocable living trust and name your beneficiaries and trustees ahead of time.
Estate planning can be a daunting thing to consider when you’re busy. And we know you are. That’s why we work diligently to present you with the best estate planning tools and strategies in a straightforward manner, letting you get back to focusing on what’s most important to you today. Give us a call at (678) 809-4922 or get our book, Estate Planning for the Modern Family, to discuss what strategies will work best to keep your assets in your family and the court out of your affairs.
Mr. Farrell is the author of Estate Planning for the Modern Family: A Georgian’s Guide to Wills, Trusts, and Powers of Attorney. You can learn about his book here and learn more about John here. Join the more than 1,000 people who subscribe to his Newsletter here. Feel free to send John a message here.