People often ask about the details associated with estate planning and whether or not they “really” need to have a plan?
As you may know, estate planning occurs when you proactively state your wishes about who you want to receive your assets when you pass away. This can be done through joint ownership, beneficiary designations, wills and/or trusts.
WHAT HAPPENS WHEN YOU DON’T PLAN FOR YOUR ESTATE AFTER YOU DIE?
ANSWER: The State of NH plans for you.
WHAT IS THE STATE OF NH’S PLAN?
Here are some examples:
- Any asset of yours that goes through probate is distributed per stirpes. Per stirpes generally means that if one of your children predeceases you, that the deceased child’s share would go to his or her children. If you want your deceased child’s share to go to your surviving children instead, you need to have a will or a trust.
- If you are married and all of your children are from that marriage, your children may be entitled to a portion of your estate rather than your spouse receiving it all. Do you want your children to receive a portion of your estate before your spouse passes away. Generally, children receive assets from their parents after both parents pass away. Ensuring that your spouse receives your entire estate may be achieved by joint ownership of assets and proper beneficiary designations, but it is important to review your assets to determine whether a will and/or trust is needed.
- If you are remarried and you have children from a prior marriage, the statute provides your surviving spouse receives with even less. Wouldn’t it be better to state your wishes regarding the distributions to your wife and children in a will or a trust?
- If you are single, have no children, no siblings and your parents are not alive, then your assets will be distributed to your parents’ siblings and if your parents’ siblings are not alive, to your cousins. Do you want your assets going to family members that perhaps you haven’t seen in years, or would you prefer that your assets be distributed to charities or to friends? These preferences must be reflected in your estate plan.
- If you have a special needs beneficiary, then the proceeds will go directly to them. Receiving an inheritance directly places the beneficiary in jeopardy of losing any public benefits he or she may be receiving. To avoid this result, it is best to speak to your estate planning attorney regarding a special needs trust or other ways to protect your special needs beneficiary.
For questions on how to avoid the State of NH’s plan and how to plan your estate proactively, it is important to speak with your estate planning attorney.