What will an Estate Plan Accomplish?
Protect Your Surviving Spouse
Do you want to ensure that your spouse has financial security when you die? An effective estate plan accomplishes that goal and is one important reason that people put a plan in place. Without an effective estate plan, what you own may be directed by the court to benefit someone other than the surviving spouse. As a result, it is important to take action to give your surviving spouse the security they need.
For example: James inherited stock in Widgets, Inc. from his parents. The stock from Widgets, Inc. paid dividends that James and his wife, Nancy, used to pay for their living expenses. If asked, James would want Nancy to continue to get the dividends if he dies first, but James never takes any action to protect Nancy. He didn’t have a Last Will and Testament written or take action with any of the other options that were available and due to James’ inaction, Nancy was not protected or taken care of in the way that James would have wanted. When James died unexpectedly, the Texas courts had to get involved and because there was no plan in place, the judge followed rules that resulted in court orders stating that their children immediately receive two-thirds of the stock that James had inherited.
There was also the issue of the house. Even though James and Nancy both had their names on the title to the home, because they had not put a plan in place that stated their specific wishes, the home was not automatically 100% Nancy’s. When Nancy went to sell the home, she discovered that in Texas that two or more people listed on a deed, even if married, cannot automatically leave the house to their surviving spouse unless they use specific language. James and Nancy had not specified their wishes because there was no plan in place, and so an attorney had to be hired and the court was involved to determine when Nancy had the authority to sell the home.
Prior planning can prevent the courts from being involved in making decisions on your behalf and will allow you to ensure your spouse is protected according to your wishes when you die.
Estate planning can protect your spouse by:
- Arranging for your assets to be immediately available for your spouse after you die;
- Arranging your affairs so your spouse will have the immediate freedom to sell your home, other real estate, or other assets after you die (without requiring the permission of the court and necessity of hiring attorneys and being subject to court proceedings); and
- Ensuring that your exact wishes are carried out to protect your spouse as you see fit.
Justin T. Crain is an estate planning attorney in the Plano, Texas office of Thomas, Walters, PLLC where he provides legal services such as Wills, Trusts, Gun Trusts, Guardianship Administration, Probate, Estate Administration, Medicaid Planning and Nursing Home Planning to those in the surrounding areas of North Texas.