No Estate Plan? That’s One Option

Some say half of Americans are without an Estate Plan, which is probably not the way to go.

If you die or become incapacitated, get ready for the big freeze. While there are ways around it, for the most part be prepared for the cold shoulder because that’s what happens to your assets when you loose capacity or die. You probably will know nothing about it, or what’s going on beyond the haze of consciousness, but your loved ones will feel it right away. Big Brother is real and waiting to take a bite out of the things you own.

Big Brother is real and waiting to take a bite out of the things you own.

You can minimize the damage inflicted by North Carolina intestacy laws that kick in if you die without a will. Here’s how:

1. Real Estate. Be sure all real property is held as Joint Tenants with Right of Survivorship, or also known as Tenants by the Entirety if married. Upon death of one spouse, the other automatically becomes 100% owner of the property. If you become incapacitated, however, this can become problematic and require the intervention of the court. Joint Tenancy, NCGS 41 § 70. Tenancy by the Entirety, NCGS 41 § 55.

2. Retirement Accounts and Life Insurance. Update all Designated Beneficiaries (DB) on retirement accounts and life insurance policies, and provide at least one alternate beneficiary, in case your DB doesn’t survive you. Also, avoid naming any minors as DB’s they cannot legally hold funds in their name and the court will impose itself into the process in this instance.

3. Bank Accounts. Contact your bank and add a Payable on Death designation to your accounts. Unfortunately, you are unable to designate an alternate beneficiary if your DB does not survive you, and remaining funds may be subject to the claims of creditors. In the alternative, you may also add one or more persons to your account with the right of survivorship, as long as you submit to the bank an agreement with all the parties signed and in writing. Right of Survivorship in Bank Deposits Cremated by Written Agreement, NCGS 41§ 2.1.

4. Brokerage Accounts. Contact either your stockbroker or the brokerage company and request to take ownership in your stocks, bonds, and account in Transfer on Death form. This will have no effect while you are alive, but upon death, the assets will pass directly to the Designated Beneficiary. The Uniform Transfer on Death (TOD) Security Registration Act, NCGS 41 § 41.

5. Anything Else. Give everything else away before you die so there is nothing left to go through probate.

Granted, this is a swiss cheese approach as it is full of holes. It would be wiser to put in place a simple estate plan. If you are an active public servant (police, military, pastors, nurses, fire fighters, and paramedics) or just entering society as a citizen under 26 years, check out the 40% discount offered through Fortress Law at FortressLaw.us. It could save your loved ones from being left out in the cold, and save you some cold hard cash.