Estate Planning FAQ
At Hartmann Law, we believe informed clients make the best decisions about their estate plans. That's why we want to break down complex terms and clarify confusing principles so that you make the right choices for your estate. Contact our office for a free initial consultation to determine if we are a right fit for one another. If so, a Discovery and Education conference will follow that allows the Firm to review a snapshot of your world, review what is important to you, and discover the best tools available for your planning objectives. In the meantime, here are responses to some of the most frequently asked questions we get when new clients come to our office in New Jersey .
What is estate planning?
Estate planning is a process allowing you to arrange how you want your life to look when you are not able to speak for yourself, for example, if you become disabled and when you die. Most familiar is the planning for death, and how your money and property will be managed and distributed upon your death. Sometimes, if you have limited assets, limited beneficiaries, and limited instructions on how to distribute your assets to the beneficiaries, planning is pretty straightforward. On the other hand, the more assets, the more beneficiaries, and the more instructions may require an estate plan that is more complex and varied.
Generally, there are two components of estate planning with one involving the legal aspects of it and the other involving the non-legal aspects of the plan. Your estate planning attorney can help with both. Legally speaking, your lawyer will review your personal and financial situation and create documents that address the latter. Non-legally speaking, your lawyer will help develop strategies that meet your personal objectives, and provide help when deciding who will be best to act in your place is unclear.
What goes into an estate plan in New Jersey ?
An estate plan will include the documents that accommodate your specific needs. It may involve some or all of the following:
- Last will and testament
- Living trust
- Irrevocable trusts (e.g., life insurance trusts, gift trusts, special needs trust, charitable trust)
- Conservatorship
- Guardianships
- Pet trusts
- Asset protection from divorce, creditors, others
- Health care directives, including medical powers of attorney, living wills, health care proxy, do not resuscitate (DNR) or do not intubate (DNI) orders
- Succession plan for business
- Charitable planning
What is probate?
Probate is the legal process of transferring the property from a deceased person's estate to their heirs or beneficiaries. In New Jersey, it is overseen by the Surrogate Court in the decedent (the person who died) resided at the time not their death.
What happens if I die without a will in New Jersey ?
Dying without a will means you die intestate. Your assets and belongings will get passed to your heirs according to your New Jersey's intestacy laws.
What happens to my will if I move to a new state?
In rare cases, the differences in state laws could make it invalid. More commonly, if you moved to a state that views marital property differently from your former state of residence, the change in laws could result in complications. It is wise to revisit your will with an attorney in your new state after moving.
Do I need a lawyer to write my will?
While you do not need a lawyer to write a will, doing so is a considerable risk. A last will and testament that was not written by a lawyer or that was created using an online form are more likely to be challenged, deemed invalid, or leave significant assets unaccounted for, which can create confusion and unforeseen outcomes.
Can you write a will if you have Alzheimer's or dementia?
People need to have testamentary capacity to make a valid will. This often requires an understanding of the property being devised in the will, who is going to receive it, and the purpose and function of a will. People with Alzheimer's or dementia may struggle with testamentary capacity. The best way to make sure they have a will in place is to hire a lawyer to help.
Do I need a will if I have no children?
If you die without a will, your estate will pass to others through your state's intestacy laws. However, estate planning is not just about planning for the distribution of assets at death. It is important that you plan for your incapacity and disability. Who will make decisions on your behalf if you are not able to? How do you want to be cared for?
As to the intestate succession of property, if there are no statutory heirs at law, then the state may acquire the property. So, even if you do not have children, you still need a will if you do not want the state to make decisions for you about who gets what from your estate.
Keep in mind you do not have to create a will to benefit only family. A will allows you to pass your estate in a way that will serve what matters most to you: this could be preserving the financial wellbeing of your partner, parents, or siblings, but also setting money aside for the care of a pet, or assisting a charitable organization aligned with your values.
Does my will automatically change if I divorce?
No. It is crucial to update your will after getting a divorce so that your most recent wishes are reflected in it.
Does my will automatically change if I have a child?
It depends on the language in the will. If your will specifies an action that will happen to unnamed offspring (for example: “All of my property equally to my children”), the interpretation would be different than if you made a specific bequest to a named child or children. You should always revisit your will after having a child.
What is the difference between a will and a living will?
A will – also called a last will and testament – comes into effect when its creator dies and directs the executor on how to transfer the property in the estate. A living will, on the other hand, comes into effect when its creator is alive but incapacitated – it tells others what the creator's preferences and medical decisions are regarding their healthcare.
What is a trust?
A trust is an agreement to hold a pool of assets that is set aside to be managed by a trustee, for the benefit of someone else, called the beneficiary.
What is the purpose of a trust in New Jersey ?
A trust sets aside some assets for a trustee to manage for the sake of a beneficiary. The assets set aside in the trust do not go through probate, simplifying and expediting its transfer out of the estate. The trustee must follow the instructions set out by the trust.
Can I have both a will and a trust in New Jersey ?
Yes. In fact, a property designed trust must include a will to ensure the strategies employed in the trust as carried out. Also, a will may set forth instruction to create testamentary trusts, a trust that is not created until the decedent's death, by operation of the will.
Are trusts only for rich people in New Jersey with lots of assets?
No, while asset protection and generational wealth are prioritized objectives of some trusts, many trusts are created for reasons other than or in addition to wealth preservation. Blended families, for example, those created by second marriages, or spouses who have children from previous relationships, can benefit from trust planning to ensure fairness contemplated in life is carried out in death. Minor children, disabled family members, beneficiaries who may battle addiction or where concerns for the ability to manage an inheritance are other reasons to consider creating trust. Controlling distributions and probate avoidance are other common reasons to consider creating a trust.
What happens to jointly owned property when one spouse dies?
When spouses jointly own property and then one spouse passes away, the property is automatically passed to the surviving spouse. An example would be the marital home owned by both spouses.
What is a guardian?
A guardian is a person who is responsible for someone else's well-being. People often appoint a guardian for their underage children in their will or for their adult children with special needs. These legal guardians can make legal decisions on behalf of their charges, much like a parent.
How can I designate a guardian for my children?
Naming a legal guardian for your underage children is a common provision in a will. You also have the ability to appoint a conservator for adult children who may be unable to make certain decisions.
If you do not appoint a legal guardian via a will, the court will appoint one upon your death. For this reason, it is important even if it seems like commonsense to make sure you designate a guardian in your will.
How can we make sure our special needs child is cared for after we die?
A common way to ensure a special needs child continues to receive the care they need is to appoint a guardian for them and to create a special needs trust for them.
How can I make sure my pet is cared for after I die?
A common way to care for pets after their owner passes away is to create a pet trust which will name a person to care for the pet, as well as provide instructions and guidelines that set forth the care that is required of the someone to ensure that the pet is being taken care of as stated in the trust.
When do I need a power of attorney?
A power of attorney is essential for people who are unable to make important medical or financial decisions on their own behalf, usually because they are incapacitated or suffering from a medical condition. There are five types of powers of attorney, each with their own purpose:
- Durable power of attorney
- Medical power of attorney
- General power of attorney
- Limited (special) power of attorney
- Springing power of attorney
Contact an Estate Planning Lawyer in New Jersey Today
Hartmann Law understand that discussing death and disability is challenging, and we are here to ensure that you are sufficiently informed to make decisions that will provide peace of mind. We help you create a Life and Legacy plan for today with an eye on the future - by design and not by default! Contact us today to schedule a free initial consultation.