One of the most compelling reasons to update your estate plan is that doing so can guarantee your assets will stay in your family.
This way, you can ensure that when your children or loved ones inherit their share, they will not lose it in a divorce or other lawsuit.
In addition, you can guarantee it will stay in your own family and will not go to your in-laws. Many people want this. So, how does it work?
Let us assume Jack and Jill have two children, Emily and Susan. Emily is married to Sam and Susan is married to Jeremy. Each daughter has one child.
Jack and Jill want to make sure Emily and Susan each get 50 percent of their estate, but they also want to make sure that neither Sam nor Jeremy gets it, and that it will ultimately go to their grandchildren.
Jack and Jill probably have other legal objectives, like avoiding unnecessary probate, avoiding unnecessary court involvement if they become disabled mentally during life, and preserving the option for their agent to do Medicaid planning so as to protect their assets from dissipation due to nursing home costs.
But with regard to their goals of making sure their money stays in the family, Jack and Jill need to make sure their legal papers will accomplish this goal. Their estate plan needs to direct that on survivor's death, assets left to their children will be left in trust with remainder to their grandchild.
Usually, we state if a child passes and the grandchild is under age 25 or 30, then their share will continue to be held in trust for the grandchild's health and education.
Then when they attain age 25 or 30, as the case may be, they become full owners of the rest of their share and can spend it as they wish.
It is not difficult to do this and to accomplish the other important goals mentioned above, but you must plan in advance. As always, a little bit of planning can make a big difference for you and your loved ones.
Mark F. Winn, J.D., Master of Laws (LL.M.) in estate planning, is a local asset protection, estate and elder law planning attorney. www.mwinnesq.com