Do I Even Need A Will?

Join Attorney Philip J. Ruce in this ongoing video series as he briefly discusses frequently asked questions in estate and trust planning.

Today, Philip discusses whether a will is even a necessary part of your plan.

Attorney Philip J. Ruce has been awarded the Super Lawyers Rising Star designation for 2016.

Ssuperlawyerbadgeuper Lawyers is a Thompson Reuters publication which rates “lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement.” Their “patented selection process includes independent research, peer nominations and peer evaluations.”

Five percent of practicing attorneys are awarded the Super Lawyers designation annually. The Rising Star designation is awarded to only two-and-a-half percent of attorneys who are forty years of age or younger or have been in practice for less than ten years.

Philip has been an advocate for many Minnesota families; receiving this honor has been an affirmation of his dedication to his clients, his peers, and his field of law.

The cornerstone of Philip’s practice is a deep respect for his clients’ desire to accomplish their goals — without wondering if their attorney shares their priorities. Philip truly believes it is your family and your legacy; hire an attorney who is as committed to your dreams as you are.

Philip’s commitment to the estate planning field goes beyond his work as a legal representative and client advocate. As a former professional trustee, he has worked on thousands of trusts and estates. Philip is a published academic and the author of “Trustee University: The Guidebook to Best Practices for Family Trustees.” His research on trustee and fiduciary duties has been published at universities around the country and as well as the American Bar Association’s legal journal for trust and probate law. Philip is an adjunct professor of law at Thomas Jefferson School of Law.

More information on Super Lawyers can be found here.

creates wills and trusts for families who want to feel secure that their loved ones are cared-for. Philip is a trust and estate attorney based in Minneapolis, Minnesota. Philip is the author of Trustee University: The Guidebook to Best Practices for Family Trustees, available at Amazon.com in paperback or Kindle edition (free chapter available here!). He also works with trustees and beneficiaries who need help with their trusts. You can contact him here.

February 3rd, 2014 was a Monday; it was also my first day back from my honeymoon and it was very, very cold outside. I was newly married and had just left six years of estate and trust administration behind with plans to start a new estate planning law firm. Countless miles, meetings, conversations, and introductions later, and suddenly it’s been two years.

Thank you, all of you, for making the first two years of Stone Arch Law Office, PLLC what it is. I can’t imagine a better bunch of colleagues, clients, and friends.  I have no plans to  do anything but this work forever, and I hope I can continue to help you and those who mean so much to you with their planning in a way that is friendly, accessible, and within a budget.

As always, please let me know what I can do to help. I’m looking forward to a great 2016 (and beyond) with all of you.

Phil

 

creates wills and trusts for families who want to feel secure that their loved ones are cared-for. Philip is a trust and estate attorney based in Minneapolis, Minnesota. Philip is the author of Trustee University: The Guidebook to Best Practices for Family Trustees, available at Amazon.com in paperback or Kindle edition (free chapter available here!). He also works with trustees and beneficiaries who need help with their trusts. You can contact him here.

I was quoted extensively in this article on wills and estate planning. The article deals with whether assets should be left to children “equally” or “equitably.” Equally of course meaning that everyone gets an equal share. Equitable is little more fuzzy, and deals with what is “fair,” considering such things as who has received more help from mom and dad during their lifetime, who spent more on mom and dad’s care when they were in their elder years, etc. Here’s an excerpt from the full article, found at Investopedia, written by Amy Fontinelle.

Could a Child Sue for More?

If you decide not to divide your assets equally among your children, understand that you’re putting your plans and your children at risk of going through a lawsuit. How significant is this risk, and how likely is it that the result will be a different division of assets than the one you desired?

“Children can always sue, but there generally needs to be a valid basis for a will contest,” says Jeffrey R. Gottlieb, an estate planning attorney in Palatine, Ill. With careful estate planning, however, you can mitigate any challenge. The first step is to draft your will with the assistance of an estate planning attorney, while you’re of sound mind and memory, and without undue influence from one of your children. (For related reading, see Do You Need an Estate Planning Lawyer? and How to Reduce Estate Planning Attorney Fees.)

“Undue influence” means that one of your other children believes – or at least thinks it can be proved in court – that you were manipulated during the process of creating your will. As a result, that child contends, you expressed wishes that you otherwise wouldn’t have or that weren’t really what you wanted.You won’t be there to defend yourself against such a claim so you need to make sure no one can successfully argue it.

“Lack of capacity,” another way a will can be challenged, means that you didn’t understand what you were doing when you created or changed your will, perhaps because of your age or because a physical or mental illness had deteriorated your ability to make sound decisions. A child could also try to argue that your will isn’t valid because of fraud or because your signature wasn’t witnessed.

There are ways to minimize the chances of a less-favored child contesting your will in court, and ways to minimize their chances of winning if he or she does. “A no-contest clause paired with at least some nominal gift can create a disincentive to challenge,” Gottlieb says. The no-contest, or non-contestability clause, is, basically, language in your will stating that any inheritor who takes your will to court forfeits any bequests. That’s where the nominal gift comes in – for the clause to be effective, your child has to have something to lose. You’ll need to leave the less-favored child enough that he or she likely has more to gain by keeping quiet than by going to court.

It’s an unpalatable option, to be sure, but it might mean the best chance of keeping your will intact. The enforceability of these clauses varies by state, however, so check your state’s laws before considering this option.

Estate-planning experts say other ways to avoid challenges to your will include:

  • using a trust to provide structure for a child who might not be able to manage an inheritance responsibly on his or her own (learn more in Advanced Estate Planning: Using Trusts)
  • having your doctor be a witness when you sign your will to invalidate claims of lack of capacity
  • excluding all children from the will-writing process to invalidate claims of undue influence
  • discussing your will with each child to avoid surprises and explain your reasoning

A lawsuit of this type is always most likely to end in a settlement, Ruce says. “That settlement will in some way vary your estate plan because funds will likely end up in a different place or with a different person than you had hoped.”

The Bottom Line

“The most important thing to remember when dividing up an inheritance is that it is your money, and you have a right to do with it what you choose,” Ruce says. That said, an equal inheritance makes the most sense when any gifts or financial support you’ve given your children throughout your life have been minimal or substantially equal, and when there isn’t a situation where one child has provided most of the custodial care for an aging parent.

“When there is actual or perceived inequality,” Ruce says, “the likelihood of someone looking for legal remedies increases substantially.” You have to decide how significant that risk is given your children’s temperaments and their relationships with each other, and whether any risk in leaving an unequal inheritance is worth what you’re trying to accomplish. (For further reading, see Tips for Family Wealth Transfers.)

creates wills and trusts for families who want to feel secure that their loved ones are cared-for. Philip is a trust and estate attorney based in Minneapolis, Minnesota. Philip is the author of Trustee University: The Guidebook to Best Practices for Family Trustees, available at Amazon.com in paperback or Kindle edition (free chapter available here!). He also works with trustees and beneficiaries who need help with their trusts. You can contact him here.