Our San Jose Estate Planning Lawyer Explains What a Will Won’t Do
A will can be a valuable tool in the estate planning arsenal and almost every San Jose estate planning lawyer will typically recommend you have one. A will is relatively easy to execute, not particularly expensive and can cover many of the end-of-life issues facing most people. In fact, for some, a will alone may be sufficient. However, depending on your individual circumstances, you should be aware of what a will won’t do.
Affect the Transfer of Certain Types of Property
One misconception that many have is that if specific property is mentioned in a will, the terms and instructions in the will determine the disposition of that property. This is not necessarily the case; certain property cannot be transferred to another by means of a will after your death. Property held in joint tenancy is a prime example. To illustrate this point, say you and your spouse have each been married previously and have children from those previous unions, and you now own a house in joint tenancy. If you execute a will leaving your one-half share of the new home to your children, that testamentary wish will not be honored. Upon the death of the first joint tenant, property held in joint tenancy passes to the survivor by operation of law regardless of what your will may say to the contrary. Similarly, a provision of your will may direct the proceeds of your life insurance policy to be paid to individual A, but if the properly executed policy names individual B as the beneficiary of the policy, B gets the money, not A. Other examples of properties that pass by operation of law and are not subject to the terms of a will include:
- Money held in a retirement account, such as a pension, 401k or IRA, in which you have properly named a beneficiary
- Property held in the form of a transfer on death, or TOD, directive
- Accounts held with a payable on death clause
Even if property that you wish to convey via your will may legally be transferred in that manner, another consideration is the actual legal transfer of title from your name to the beneficiary’s name after your death. Again, using the example of the transfer of a house, say you are single and the sole owner of your house and wish to leave it to your adult children when you pass. A term in your will can accomplish this goal, but your children will not be able to walk in to the County Recorder’s office, show the will and have the title to the house transferred to their names. A probate will have to be opened and the court will verify the legitimacy of the will, title to the property and otherwise supervise the transfer of title. The probate process can be time-consuming and costly.
Affect the Transfer of Property Held in a Trust
The avoidance of probate is a primary reason many people create a trust and transfer their home and other real estate holdings to that trust. Upon their passing, title to the real estate remains in the trust, but control of the asset goes from the deceased as the trustor and original trustee to the named successor trustee, who is typically a beneficiary as well. As title did not change hands, no probate is necessary. Other assets in addition to real estate may be held in a trust, and trust assets are distributed upon the death of the trustor under the terms of the trust and not by the terms of a will that may exist.
Provide for a Dependent with Special Needs
If you are responsible for someone with long-term care needs, it is inadvisable to do so in a will. There are many complexities involved in providing the necessities of the individual without jeopardizing the government benefits that may be available, and a special needs trust is the best option for that purpose.
Although a will can be used to provide end of life instructions and funeral arrangements, in many cases, a will is not located until sometime after one’s death, necessitating an option different than you would have chosen. It is a better choice to pre-arrange your own funeral or leave detailed instructions separate from your will in a place your loved ones know are aware of.
Contact a San Jose Estate Planning Lawyer for Legal Advice
A comprehensive estate plan can fulfill your wishes and ease your loved ones’ burdens. For information on a plan best suited to your needs, call the Freed Law Firm, a San Jose estate planning lawyer group, at 831.661.0300.