Estate Planning & Fixed Annuity Forum.
Register  |   |   |  Calendar
 
 
 


Reply
  Author   Comment  
Spicuzza

Avatar / Picture

Administrator
Registered:
Posts: 353
Reply with quote  #1 
Do You Have Fragmented Estate Plans?

What is meant by "Fragmented Estate Plans?"


Most all individuals and married couples have fragmented Estate Plans.

Some assets will avoid Probate Court while other assets unwittingly get tied up in the Probate Court System...needlessly.

Examples included:

The house: Most married couples own it as joint tenants, when one spouse dies, their joint tenancy died with them. Now when the surviving spouse dies the home has to be probated before the adult children heirs can sell or rent it. Want to hear a typical horror story? Owner dies, adult children rent home out, have to evict tenant but they can't because they DO NOT have legal standing. The "Estate of the Dead Owner" owns the house. An individual who owns their home in their own name only a has guaranteed Probate Court proceeding waiting to happen.

Husband or wife separate checking accounts: You know, the bingo fund. Account just in the sole name of the wife or husband...guess what happens when the individual dies? Asset has to go through the Probate Court System. Florida is a "separate property state" if your name's not on it you don't own it. Don't get confused with a divorce proceeding where it's "Equitable Distribution" of Marital Property REGARDLESS how its titled. That's a separate and distinct animal.

Old life insurance policies: Lazy agents; named husband and wife as each other's primary beneficiary but left the contingent beneficiary BLANK. Husband dies, Mom gets paid death benefit but NEVER thinks to update her beneficiary designation from dead husband to living adult children. Mom dies years later and guess what? The cash asset of the life insurance gets needlessly tied up in the Probate Court System and now the cash asset that would have been EXEMPT from creditor claims if paid to a natural person beneficiary is now SUBJECT to creditor claims. 

Out of state property: The cabin in the Georgia mountains, the time share in Virginia Beach, the old checking account from New York, the RV lot in Arizona...guess what happens now? Two, three or maybe four or more probates have to be opened...formal administration in the state you're domiciled, i.e (Florida) and ancillary administration in each and every state in which you own titled assets...real estate, bank accounts, stocks, bonds, mutual funds. Now the attorney fees go through the roof and it's not uncommon to have a $5,000 to $10,000 asset left dormant because it costs more in attorney fees than the asset is worth.

Sure you could put your adult children names on the assets but then they own it just as well as you do and you then expose yourself to their legal problems, bitter divorce, at fault auto accident any type of judgment or lien or bankruptcy. What if they become incapacitated? Have to open a guardianship proceeding to be able to sell your own home.

Former employer 401k or IRAs or Life Insurance with ex-spouse still listed as beneficiary: We see this...all the time. 

Having a complete set of Estate Plans isn't the ONLY way to avoid the Probate Court System, but it's the BEST way.

Also, I didn't pull these examples out of thin air. The above are actual problems I've seen happen in the past 30+ years I've been a Financial Consultant.

Best regards,
Gary D. Spicuzza
Financial Consultant, since 1985.

http://www.GarySpicuzza.com
Email: cic7@juno.com
Office: 727-945-8599
Toll free: 1-877-331-GARY
Previous Topic | Next Topic
Print
Reply

Easily create a Forum Website with Website Toolbox.

Gary D. Spicuzza,
Agent-in-Charge

The Trust Group
2435 U.S. Hwy. 19
Suite 125
Holiday, FL 34691

Office: 727-945-8599