When it comes to estate planning in Bloomington, the things you overlook could cause your heirs grief and turmoil. Most people make their estate plans with the best intentions in mind for their heirs. If you are going over your estate plans, it is important for you to know when to use trusts and to fund them in a timely manner to prevent issues with your wishes that cause your family and estate to end up in probate court.
Contrary to popular misconception, trusts are not only for the wealthy. When used properly, they are a convenient and practical way to keep your estate from having to go through probate. Trusts are one of several tools you can use to make your estate plans probate-proof.
Intestacy laws govern all assets in lieu of an estate plan
When you die without an estate plan, all of your assets will go to family members that are next in line according to the laws of intestacy succession. Probate court’s decisions will override yours and could cut some of your children and loved ones out of their inheritances. If you die while your children are young, the courts will choose their legal guardians.
Trusts preserve assets and protect heirs
Creating a trust does not necessarily keep probate court from getting involved, but it does limit what they can do with your assets. Keep in mind that you must adequately fund all trusts. Assets tied to unfunded trusts fall under the intestacy laws of succession, and probate court will decide what your beneficiaries are to receive from your estate and the percentage of what they are to receive. There are circumstances where it is possible to fund unfunded trusts after the grantor’s death.
To keep your legacy intact, review your estate plans often, update them as necessary, name your trustees and be sure to fund your trusts sooner than later.