Photo by Andrea Piacquadio: https://www.pexels.com/photo/elderly-people-sitting-at-table-with-laptop-3753009/
Americans have never been wealthier than they are in 2022. The stock market and the value of real property continue to remain at highs never experienced before. Americans grow older and older and many are challenged with significant health issues, including memory impairment that has no cure.
Wealth transfer takes place in many ways, some intended and some unintended. Traditionally, someone’s last will and testament was the ultimate expression of their final intent. Over the past few decades there has been a push to “avoid probate”, which works in some cases but can have surprising implications after death. Trusts, beneficiary designations, and life estate deeds are among some of the probate avoidance techniques. These probate avoidance techniques, while convenient, can have the unintended effect of changing an estate plan. For instance, if a child is added to a bank account most, but not all the time, the bank or other financial institution will have them sign a new or updated account agreement which includes certain provisions relating to where the account (and all of the money or assets in the account) will go when that person dies. Same for life estate deeds. So, in a situation that may have simply been for convenience to assist an elderly individual manage their assets or finances, a complete 180 to their estate plan might occur leading to inheritance disputes.
As will be discussed in future articles, most all of these “probate avoidance” techniques can be challenged before and after death, but for those beneficiaries or heirs that these changes affect, you cannot sit on your hands and do nothing hoping a last will and testament fixes it.