Many people think that estate planning is only for the super-rich. This couldn’t be further from the truth. Estate planning is for everyone who owns assets. Estate planning is all about minimizing risks, and ensuring all your assets are inherited by the people you want them to be transferred to.
Most estate plans include a will. Though writing a will is important, it is not the only thing you must focus on when creating your estate plan. Your will is a part of your estate plan, not your entire estate plan.
Seek answers to these critical questions when creating your estate plan.
Estate Assets vs. Non-estate Assets: What’s the Difference?
An estate asset is held in your name. Typical examples include property held in your name, personal bank accounts, and shares.
A non-estate asset, on the other hand, is an asset that you own as a joint tenant. Assets owned by the creator’s superannuation fund or their family’s discretionary trust also come under non-estate assets.
What Happens to Property Held Among Individuals as Joint Tenants?
The right of survivorship applies to property owned as joint tenants. What does this mean? Simply put, if two people own a property and one of them dies, the full ownership of the property will automatically revert to the surviving co-owner.
If you do not want the right of survivorship to apply, take steps to sever the joint tenancy. This will ensure that your interest in the property is transferred to your estate.
What About Life Insurance Policies?
When deciding whether to include your life insurance policy in your estate, the executor will consider how it was established. If a beneficiary is named, they will receive the policy proceeds, and the policy won’t be considered a part of your estate.
What Happens to Superannuation Funds?
Your superannuation fund does not automatically form part of your estate and won’t be automatically distributed in accordance with your will.
If an estate owner dies without creating an estate plan, the superannuation fund trustee has the power to decide who gets the superannuation. You can use a binding death benefit nomination to control who gets your superannuation.
Who Gets Assets Held by a Discretionary Family Trust?
Trust property does not form part of the creator’s estate. If an estate owner passes away without creating a plan, their beneficiaries may not receive assets held by a discretionary family trust. With an estate plan, you will be able to transfer the control of these assets to a specific person.
Your search for a skilled and experienced estate planning attorney near you ends at Johnston Thomas Law. We are a team of knowledgeable attorneys. Our specialties include contracts, trust administration, and business entities. Our team will craft a legal solution customized to your needs. To get answers to your legal questions, call 707-545-6542.