Should You “Leave It to Beaver” When It Comes to Houston Estate?

Family with dogLeave it to Beaver? Or do you prefer to leave your estate to someone else? Today’s families are a lot different than Ward and June Cleaver. There are more families today with non-traditional situations than ever before. This makes financial and estate planning all the more important.

If your family looks nothing like the family of Ward and June Cleaver, you are not alone. Families today are very different compared to the days of Leave It to Beaver. Our so-called modern families leave much to consider when it comes to financial and estate planning.

A recent article in The Patriot Ledger, titled "Estate planning for non-traditional relationships," takes a practical look at a common personal, financial and legal challenge.

Asset Ownership. You can own assets in your own name, jointly, or in an entity like an LLC or a trust. The ownership issue determines things like taxes and even disposition through an estate or disability. Unlike the Cleavers, not every couple these days combines their financial assets so that everything is owned jointly. Retirement accounts can’t be held jointly, so many families will keep separate asset ownership structures with dispositive plans at death or disability that give the assets to someone other than the surviving spouse.

Married Couples. If you have assets that are owned individually, these assets will be distributed according to your will, so there may be some time and expense in the probate process. If you want your assets to go to your survivor anyway, joint ownership may be the way to go. On the other hand, if you’ve got concerns about this, a trust may be better.

Second Marriages. You need to be very clear about who gets what after the first spouse passes. Don’t just settle this with a verbal agreement with your spouse. For example, do not rely on a verbal agreement for your spouse to “use” the assets after you pass and to then pass them along to your own children. It’s much better to create a trust. Your estate planning attorney can help you with this.

Cohabitation. For families that might appear to be “traditional” except for a marriage certificate, you can make any assumptions. Married couples, at least, have some state protection from disinheriting a spouse, however, that’s not the case in every state. For estate tax purposes, the original article explains that unmarried couples don’t have an unlimited deduction for leaving assets to a spouse. Remember, technically, the mother of your little Beaver or Wally isn’t your spouse. Also, without a solid will or trust, it’s possible your “partner” will only inherit some of the assets, and the rest to be given to your parents or siblings.

For additional information on estate planning and other planning topics in Houston, please click here to visit my website.

Reference: The Patriot Ledger (Nov. 22, 2014) "Estate planning for non-traditional relationships"


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