One of the wonderful freedoms you have as a citizen of this great nation is the ability to determine how your property will be distributed and to designate who will receive your assets at your death. One of the essential estate planning tools to take advantage of this freedom is your last will and testament. Do you have a will? If so, when was the last time you reviewed it to ensure it is up to date?
Do you know that if you die intestate (without a will) as a resident of North Carolina, the laws of our state determine who receives your assets? That’s true. For example, if you die intestate leaving a spouse and two children, your spouse will receive $60,000 of personal property and one-third of your remaining assets. Your children receive the remaining two-thirds of your estate. That may or may not be what you desire. Are your children minors and in a position to manage an inheritance? Is one-third of your estate adequate to meet the maintenance needs of your spouse? As you can see, the intestate laws of North Carolina are by necessity inflexible and in many cases will not correspond with your wishes or your family’s needs. You may be equally surprised at other beneficiary distribution rules specified in the state intestacy law.
You don’t want your legacy to be an unintended one or to have unintended consequences, such as Martin Luther King, Jr.’s estate. We celebrate the legacy he created with the civil rights movement each year, but there is also a lesser known legacy he left behind by not having a will. Since he died intestate, there have been multiple lawsuits against his estate, as there have been with many other individuals, famous and not so famous.
But, what if you have a will? Great! Then why should you review it? Some reasons are fairly obvious:
- Birth of a child or grandchild
- You have a recent change of residency
- The death of a family member and beneficiary
- Tax code changes
Then there are some less obvious factors that may have slipped by you. Some to consider are:
- Has your estate become less liquid? Will your estate have enough cash to meet expenses or tax obligations? If you have real estate holdings or family business interests, they may be hard to sell. You will need special planning to avoid a forced sale at undesirable prices.
- Have there been changes in a beneficiary’s needs? Have your children become financially successful? This provides you with an opportunity for considering a charitable bequest or establishing a charitable trust.
- Are you satisfied with your selection of an executor or trustee? The settlement of an estate is a demanding job. If an individual is your named representative, is that person in good health and does he or she have the time to devote to the tasks? Especially for the larger, more complex estates, the services of a professional fiduciary should be considered.
We at Old North State Trust, LLC specialize in estate settlement, trusteeship and investment management. We would welcome the opportunity to work with you and your attorney in reviewing your estate plan. You may contact any of our staff members if you have questions about your will, how trusts work, or your investment options.
Old North State Trust, LLC (ONST) periodically produces publications as a service to clients and friends. The information contained in these publications is intended to provide general information about issues related to trust, investment and estate related topics. Readers should be aware that the facts may vary depending upon individual circumstances. The information contained in these publications is intended solely for informational purposes, is proprietary to ONST and is not guaranteed to be accurate, complete or timely.
Susan Willett is the director of trust services and oversees all aspects of trust administration for Old North State Trust, LLC. Old North State Trust, a North Carolina chartered trust company, provides: asset management services; income, estate and trust tax consulting; retirement planning and administration; and trustee and estate services to both individuals and businesses. Old North State Trust professionals have many years of experience and for over a decade have assisted clients in identifying and reaching their financial goals. For more information, visit www.oldnorthstatetrust.com or call