A very common answer we get to the question "Do you have an estate plan?" is, "I have a Will". Most people are under the impression that a Will properly distributes their assets at their death. The problem is that those directions are simply written instructions to the probate court. When you pass away, and you have assets titled in your name (your home, car, investments), those assets are now titled in the name of a dead person and must go through the probate process with the court system before anything can be distributed to your heirs. This process involves lawyers, time, and money, and your assets are essentially frozen until its complete. Depending on the size of the estate, it can take months to years and cost up to 10% of the estate's value!1
If you don't have a Will, the state actually already has laws in place for how your assets will be distributed called "Intestate Succession".2 Nebraska's Rules are as follows:
If you don't like Nebraska's defaults, a Will is better than nothing, but it's still not the most efficient way to transfer your wealth.
A Revocable Living Trust can completely avoid the probate process and save your heirs unnecessary expenses, time, and stress. Here's how it works: Your assets (home, vehicles, investments) are placed in the name of your Trust, and while you are living, you control the assets as the Trustee. When you pass, the assets are not frozen or held up in probate, they remain in the Trust, and a Successor Trustee, named by you, will take over managing and distributing them according to the instructions in your Trust. This is a much more streamlined approach that can keep your assets out of the court system and in the hands of your family.
If this is something you would like to know more about or get started on, give our office a call and we'd be happy to help you get started. You can also check out the educational webinars we've done on the topic:
Estate Planning 101: How to Efficiently Transfer Wealth
5 Major Estate Planning Mistakes to Avoid
References:
1. Kaminsky, Michelle. "Understanding Probate Lawyer Fees", Legal Zoom, May 26, 2022. https://info.legalzoom.com/article/how-much-does-it-cost-probate-will
2. Thompson, Chris. "Inheritance Laws in Nebraska", SmartAsset, March 1, 2022. https://smartasset.com/estate-planning/nebraska-inheritance-laws