Estate Planning Mistakes To Avoid… Horror Stories of Improper Estate Planning

Hello, and welcome back to another episode of the Estate Planning Podcast. I’m your host Colby Kukelski. The Estate Planning Podcast is brought to you by our friends with Rhodes Law Firm. In this week’s episode, we’re going to do something a little bit different than we normally do. In this week’s episode, we’re going to talk about some of the horror stories that come with not having an estate plan, or an improper estate plan. Now remember, when we’re talking about an estate plan, we’re talking about either a Last Will and Testament or a Trust. Again, anyone who has anything whether it be just a bank account, or bank account, and real estate, should have some type of estate plan in place, depending on the type of estate plan will vary from family to family, but everyone should have something in place.

Now there are times where I’ve come across clients whose loved ones did not have an estate plan in place. So think of this episode as your cautionary tale. To have something in place, I always say something is better than nothing. And when we’re talking about an estate plan, that couldn’t be any closer to the truth.

The first story I want to focus on for today is a family who did have a plan in place, they had a trust in place. And if you recall from our earlier episodes, trusts avoid probate. But where they went wrong, is they didn’t periodically come in for a review of this plan. So over the years, they acquired new assets, a couple new pieces of land, some new bank accounts, and they didn’t know or didn’t realize that they had to come in to review their plan to ensure that these new things they’ve acquired is tied to their plan. So when mom and dad both passed away, the children came in to see us. And we learned that a couple pieces of their property hadn’t been tied to their trust. So what that meant is that now we’re going to have to go through that probate process. And probate again is asking the court to verify your Will. So anytime you have a Trust in place, you typically also have a backup Will, just in case just like in this type of situation. Now in this situation, to make it even more unique, is there were lots of siblings, I think six in total, and not everyone got along with each other. So when we initiated the probate process, we were initiating it over one piece of land. Again, we knew what was supposed to happen with the land. But because we were having to go through probate, we’re now having asked, having to ask all the kids to agree to that. And again, they didn’t see eye to eye on the situation. So needless to say, the probate dragged on for three years, all over one piece of land. So even if you have an estate plan in place, it’s still very important that you periodically review it so we can avoid situations like this. Anytime you have, you know, the saying is more than one cook in the kitchen, but anytime you have multiple people involved, and especially if they don’t always get along, it can very much complicate the administration of your plan at your passing.

The next potential horror story that I want to focus on is another family who again, did have an estate plan in place he had a Last Will and Testament, but it wasn’t the best plan to have in place. In this situation, it was an elderly man and his nineties who never had married, never had any children. And he left everything to one nephew of his. Again, the Will stipulated that, but because Wills require probate, the nephew who was set to inherit everything has to now petition the court requesting permission to validate that Will. Anytime you have to go through probate, if you’ll recall, we’re not only having to ask the person who’s inheriting everything from the Will but also the people who could have inherited had there been no Will, or the other heirs at law. In this situation, this elderly man again was in his 90s. During his life, he had five siblings, both of his parents had predeceased him. So his closest heirs would have been these five siblings. All five of these siblings except for one, had predeceased him. And so then we’re having to involve the other nieces and nephews. So this quickly turned into what we thought should have been just one person involved, that one nephew, turned out to be about 15 to 20 people, all the children of those deceased siblings, and some children of the deceased nieces and nephews are now having to be asked, What do you think about this Will? Again, they’re not getting anything, but because they’re considered heirs at law, they have to be involved in the probate process. Again, these are people that this nephew has never met, or may have not seen in years, that we’re now having to track down and locate all because this elderly man was using a Will. Had he used a Trust, we could have kept it out of probate. And if we would have kept it out of probate, we wouldn’t have had asked all these people, what they think about this Will.

And finally, the final horror story to talk about this week is going to be in the event there was no estate plan. I had and younger gentleman come in whose wife had passed away at a relatively young age, early 30s. And they had one minor child, she had no Will in place, and half the house was in her name. Now he’s trying to sell the house. But he’s being told that he has to go through probate to be able to sell her portion of the house. Not only in this is this man having dealt with the loss of his wife at a very young age, but now he’s having to deal with the probate process as well. Because she didn’t have a plan in place that stipulates what happens with her assets upon her passing her assets, they pass according to the law, or intestacy. Here in Georgia, that doesn’t mean all to your surviving spouse or minor children can inherit assets this way as well. So in our situation, we’re having to go through the probate process for half of the house. And then determining how that house is to be inherited, a portion was left to her husband, and a portion for the benefit of her minor child. And again, anytime a minor is ever involved, the court will appoint a conservator to control the assets for the benefit of that minor child. So when this home sold, a portion of the proceeds went to her husband and a portion went to that minor child.

This isn’t necessarily what he was expecting to happen. But since you know, his late wife didn’t have a plan in place. It certainly did complicate the probate process and the selling of the home. And he was having to do this at a time where he had just lost his wife and his child had just lost her mother. So think this through any time you have something whether you know, that’d be a little bit or a lot, you should always have some sort of an estate plan in place. Again, something is better than nothing. But in most instances, you certainly want to keep it out of the probate court.

And that’s it for this week’s episode. I really hope hearing some of these stories remind you that having an estate plan in place is crucial. It’s an uncomfortable conversation to have and no one wants to have it even at a young age. But it’s very important that you plan ahead of time if something should happen to you, where your things will end up and the simplest way to accomplish that. If you’ve enjoyed this week’s episode, I hope you’ll like and subscribe and join us back here next week. And if you ever have any additional topics you want more information on please feel free to send that information in we may cover in future episodes I’m your host Colby Kukelski and this has been the Estate Planning Podcast.

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