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Subscribe to this list via RSS Blog posts tagged in asset protection

Posted by on in Uncategorized

The world is a dangerous place, and not just the places highlighted on the news every night. The truth is that even the sidewalk outside our door can be a place of peril.

Consider the case of a couple recently killed in a California highway accident by a driver who inexplicably ran into a pole ­leaving the couple’s infant behind with major injuries. Or perhaps, the family in Canada who were backed into by a car outside Costco ­killing the six­-year-­old girl and injuring her sister and pregnant mother.

How about lightning striking a 20­year­-old man in the middle of summer at Venice Beach in Southern California. That never happens but this time it did.  These tragedies, which happen every day all around the United States, are bad enough but they are compounded for the families of those injured or killed by a lack of preparedness.

 

Take the case of the highway tragedy. What we know is that two parents are dead and they have a grievously injured child in the hospital. We don’t know if the parents had a will.

 

A will would be the only document that would have allowed the parents to designate a ‘guardian’ for their child, assuming the child recovers. The couple may have designated one set of their parents or another relative or friend to raise their child.

 

Proper planning would ensure their child is immediately cared for by people of their choosing. Without that clear direction, there could be an ugly fight about who will take the child in the immediate term as well as potential conflict about who will be in charge of any money left in the estate of the parents. The estate, in fact, might have to be probated.

 

Probate is an unnecessary court process that can take control away from the family. It's also totally public and can be more costly for the family than planning in advance to stay out of Court.

 

Another issue, of course, is who pays the hospital bill for the child and who pays the debts of the deceased parents.

 

That will all be handled by the person appointed by the Court or named in a Trust to handle the assets and debt left behind. If you want that handled by someone of your choosing, you need a Will and if you want that handled without the necessity of aCourt process, you need a Trust.

 

But most of all, what you need is a relationship with a trusted lawyer, so that if a tragedy strikes your family, you have somewhere to turn for clarity and re-assurance during the most difficult time.

 

Normally, if the couple had estate documents such as a Will and Trust, their debts, including hospital  bills  for  the  child,  would  come  out  of  their  estate.  The parents may have had insurance so there would be a money source there.  If there was no money or assets, or insurance in the estate, the debts, most likely, would not get paid.

 

The people who benefit from your pre-planning are the people you love the most. Be responsible and ensure your family always feels well led and well-loved.

 

What folks can do now is prepare for these kinds of tragedies and here is how:

  1. Create a Will and keep it up-to-date. If you have minors, create a plan for them as well as identify a guardian of any money/property the child(ren) stands to inherit.

  2. Maintain adequate health and life insurance in case disaster strikes and create a relationship with a trusted lawyer.

  3. If your estate contains assets that would go through the probate court process consider owning your assets in a living trust.  Keep your family out of court and out of conflict as a way to avoid probate and to keep your affairs private.

 

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