Offered by Michael A. Dolan
Estate planning is more than avoiding probate and saving taxes. A properly designed estate plan can provide so much more to protect your family. Most of these protections are ignored in cookie-cutter, form driven estate plans. For example….
Mary and Bill left their son John a substantial inheritance. John had grown up, gotten married, completed college, and had a good job. Then came the accident. As John was rushing to work on a wintery morning, he lost control of his car and crashed into a school bus full of children. Many were hurt. John was sued and found negligent. The resulting claim far exceeded his auto insurance limits, and even after the insurance paid $1,000,000 to those injured, he was staring at a court judgment of more than $3,000,000. His assets would have to go to pay the amount due. John was looking at bankruptcy. Then he learned the good news.
Bill and Mary had sought legal advice before their deaths. The first lawyer they spoke with said they did not need estate planning because their estate was worth less than the estate tax exemption. He told them to put everything in joint tenancy, because “it is simple and avoids probate.” They weren’t comfortable with that advice, and sought advice from a counseling oriented attorney who took the time to learn more about them, their estate, and their goals.
Their primary objective was to protect John after their deaths. So Bill and Mary left their assets in trust for John, not directly to him. As a result, John was able to keep his inheritance. While they never thought this would happen to their son, their foresight was now going to pay off.
Bill and Mary had sometimes wondered if the planning they did was worth the extra time and effort. Clearly it was.
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