August is #NationalMakeAWillMonth!

August is #NationalMakeAWillMonth.  What are you doing to celebrate—having a will prepared this month?  Instead of discussing what happens with a will, here’s what happens without one.

When you die and you have not prepared a will, you die intestate.  The laws of “descent and distribution” in your state kick in, and the court uses these laws to decide who gets what.  The court appoints a person to administer your estate.  The court decides who will care for your children.

Without a will:

  • You don’t decide who gets what assets you own
  • You don’t dictate who winds up your affairs
  • You don’t choose who will parent your children
  • You don’t decide where your pets will go
  • You don’t decide whether you’ll be buried or cremated, or where you’ll be buried

Celebrate #NationalMakeAWillMonth by having a will prepared this month.  Take control of what happens to your assets at death!

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All I want is a simple will.

Legal resources for handling your own legal matter should be made more readily available for the public since the cost of hiring an attorney can be too expensive for too many.  In some situations, handling your legal matter yourself can be done if you are diligent about researching what you need, what is available, and what is required.  Unfortunately, the trap of “you don’t know what you don’t know” can ruin the best-laid plans, particularly estate plans.

“All we want are simple wills.”  This statement is followed by the direction that the couple (let’s assume they’re married) wants to leave everything to their spouse first, then the kids.  That does sound simple:  Mike and Carol Brady’s will would leave everything to each other then to their kids.  What could go wrong?

A popular do-it-yourself-will website posted an article that shows the reader how easy it is to write your own will.  First, name your executor.  Second, name “guardians for young children.”  Third, describe how assets will be divided and distributed.  Fourth, sign in front of two witnesses, then have them sign.  This is great too—again, what could go wrong?  This does sound easy.  Who needs an attorney!

Let’s examine the Brady’s “mirror wills” (they mirror each other—all to spouse, then to kids equally).  The first red flag is that the Brady’s have children from other relationships, and like most blended families, the kids aren’t adopted.  In most states, stepchildren do not inherit (unless specifically named).  Here, a typical will would state “I leave all my assets to my wife Carol; if she predeceases me, then to my children in equal shares.”  Mike dies, and all of his assets go to Carol.  Carol dies, and her mirror will states “…all of my assets to Mike; if he predeceases me then to my children equally.”  At Carol’s death, she had inherited all of Mike’s assets from when he died.  Since Mike predeceased her, then all of her assets, including from Mike, go to Marcia, Jan and Cindy.  Those are her children.  Greg, Peter and Bobby are her stepchildren.  What do the boys get?  Nothing under this standard, simple will!

Now let’s examine the do-it-yourself article.  Name your executor—not too hard, although the article did not mention naming successor executors, but most people would know that.  However, “Name guardians for young children.”  I name my brother John Doe and his wife Jane as guardians because they know and love my kids.  What if they divorce—now my kids might be in the middle of a custody fight because both were named guardians.  What if my brother John is killed in a car accident—does my sister-in-law keep my kids?  She would if both are named.  Or at brother John’s death would I then want my kids to go live with my sister so my kids remain with a family member?

The best (insert a little sarcasm) advice is “describe how assets will be divided and distributed.”  That appears easy to do—divided evenly among my 3 kids.  I see that phrase often in wills, “to my children equally.”  Dad dies, Kid 1, Kid 2, and Kid 3 each get an equal share of his estate.  But what if Kid 3 died before Dad?  An attorney would counsel you, and prepare accordingly, whether you want your estate divided between Kid 1 and Kid 2, or if you want one share to Kid 1, one share to Kid 2, and one share to go down to the children of Kid 3 (Dad’s grandchildren).

Most people who do their own wills and estate plans think the documents are good, but they don’t know what they don’t know, and they definitely won’t know because they’ll be dead when any problems are discovered (“oops, Dad disinherited his grandkids”).  Simple wills are not that simple in many instances.

Authorized user on a dead person’s credit card—“but Dad said I could…”

Dad dies.  His adult daughter is an authorized user on his credit card, and Dad gave her permission to use the card for whatever she wanted.  Dad happily paid the monthly bill.  Dad dies and Daughter keeps using the card, thinking that she has always used it and thought she still could.  Or, in many cases, she is the executor of his will and uses it to pay for bills or other expenses related to Dad’s final expenses.  Permissible?  Obviously (at least to me) not, but it happens frequently.

An authorized user’s use of a credit card after the primary account holder dies is illegal.  Under state law, it is considered fraud, and is no different than finding a stranger’s credit card and using it.  The authorized user could face jail and, or fines.

The terms of use for credit cards state, generally, that an authorized user’s privilege to use the card ends automatically upon the death of the primary cardholder.   If an authorized user continues to use the card after this privilege ends (cardholder dies), such use constitutes the authorized user’s agreement to pay the bill which might include the entire balance, not just what the authorized user bought.

For instances where an executor who is an authorized user with good intentions uses the deceased’s credit card to pay bills, the end result—liability on the authorized user—might not change.  Daughter/Executor cannot use Dad’s credit card after his death to pay any of his outstanding medical bills, credit card bills, utility bills, etc.  Executors must pay expenses and other estate bills from assets of the estate.  If there are no assets of the estate, then the estate is considered insolvent.  Racking up the balance on a credit card of a deceased person, whatever the reason, will result in liability for those charges, and perhaps the entire card balance, on the authorized user, including (in this example) the executor.

If you are an authorized user on a credit card, notify the credit card company immediately upon the death of the primary cardholder.  Using the primary cardholder’s credit card after death when you have no right to do so will likely have no good outcome.

Contact me at julie@juliemillslaw.com or message me through http://www.juliemillslaw.com with any questions.