There are several key misconceptions about estate plans. Although many people are becoming aware of the benefits of estate plans, these myths still persist. If you want to learn how an estate plan can benefit you in your unique stage in life, a Lee’s Summit estate planning attorney can guide you through the potential documents that can create your comprehensive or simple estate plan.
Some of the common myths about estate planning include:
Myth #1: A Will Can Keep an Estate Out of Probate
A will cannot keep your estate out of probate. Wills are a foundational part of most estate plans, as they state your wishes for estate distribution. However, they are public documents that are managed and implemented by the probate court. Only creating a will simply lists your wishes, an executor for the estate, and a guardian for any minor children you have. Because it is public, these wishes, your assets, and who received them will be part of the public record.
If you want your estate to avoid probate court, you have to take more comprehensive estate planning steps, including creating one or more trusts. A trust is like a will, enabling you to list how your assets are distributed. However, it is a private entity that keeps assets out of probate.
Myth #2: Estate Plans Are Only Helpful If You Are Wealthy
An estate plan has benefits for many people, not just those with significant assets. An estate plan does more than just provide financial protections, as well. If you are someone with children, any assets, or personal wishes for your own medical care at the end of your life, an estate plan could be beneficial.
An estate plan gives you control over what happens to your assets, who cares for your children, and what assets your spouse, children, and other family members receive. An estate plan also protects you if you become incapacitated or disabled in a way that prevents you from expressing your wishes for medical care or financial actions. Without an estate plan, these decisions and actions are left to chance.
Myth #3: Young Adults Don’t Need to Worry About Estate Planning
Ideally, young adults do not experience things in their lives that require a complete estate plan. Unfortunately, accidents and unfortunate circumstances can occur, resulting in disability, incapacitation, or even death. Although it may feel too early to create an estate plan, it can end up providing you with peace and comfort about the care of your loved ones. It can also provide certainty about how your medical care will be managed and how your bills will be paid.
Myth #4: Estate Plans Only Have Benefits After Death
Estate plans offer other benefits through documents such as powers of attorney, medical directives, or living wills. These documents primarily provide you with protection during your life in the event of illness or injury that causes you to become incapacitated.
Powers of attorney enable you to put someone in charge of legal, medical, or financial decisions in your life, and medical directives enable you to list your personal wishes for medical care. An estate plan can also give certain tax benefits through the use of irrevocable trusts.
Myth #5: Creating an Estate Plan Is the Last Step in Estate Planning
You should not leave an estate plan after creating it and assume that it will be fine for when you need it. Estate plans are meant to be continually updated every several years or after significant life events. Changes to your wealth, your family arrangements, or your personal wishes should result in changes to your estate plan to reflect those new circumstances. Estate plans also need to be updated and altered to fit with changing state and federal laws. If you do not update your estate plan over time, it could become unenforceable.
FAQs
Q: How Much Does an Estate Have to Be Worth to Go Through Probate in Missouri?
A: For an estate to go to probate in Missouri, it must be valued at over $40,000. An estate’s value under Missouri law is based on its entire value minus liens, debts, leases, easements, and mortgages.
If the value of the estate is $40,000 or less, it qualifies as a small estate, and heirs can file for a simplified probate process, which is typically shorter, simpler, and less expensive. For their estate to avoid the full probate process, individuals can create trusts and other estate planning techniques to keep their assets out of probate.
Q: How Can You Avoid Probate in Missouri?
A: There are several options to avoid probate in Missouri, with the most effective way being the use of revocable, or living trusts. Comprehensive estate planning can help your estate and your heirs avoid the lengthy process of probate after your death, and it can also provide other benefits.
Revocable trusts are the most reliable and common way to keep assets out of probate, as the creator of a revocable trust can update and alter the contents similarly to a will, but a trust is a private entity and not a public document.
Q: What Is the Inheritance Law in Missouri If There Is No Will?
A: If there is no will after someone dies, then Missouri intestate succession laws will determine inheritance rights. Spouses and dependents are given the highest priority to inherit, with the spouse receiving the entire estate if there are no descendants.
If there are surviving descendants and a surviving spouse, the estate is split between them in different ways, depending on whether the descendants are the legal descendants of the surviving spouse or not. If there is no surviving spouse, then the estate is split between the deceased’s children and their descendants in equal parts.
Q: Does a Car Have to Go Through Probate in Missouri?
A: If no estate planning is done, then a car must go through probate court to transfer the ownership of the vehicle. The simplest way to keep a car out of probate court is to designate a transfer on death (TOD) beneficiary for the vehicle, which will enable the car to pass directly to that beneficiary and avoid the tedious probate process.
Creating an Estate Plan Tailored to You
An estate plan can be made up of many different documents, depending on your needs and those of your estate and family. Determining which documents are right and ensuring that your created estate plan is enforceable is much easier with a skilled attorney. Contact Stange Law Firm today to learn how we can help.
