Estate Planning Assures Those You Want To Benefit Will Benefit

by Karen L. Brady

This is the first in a series of blog entries on what estate planning can accomplish.

Estate planning can assure that your assets and legacy pass to whom you want in the way that you want. Without estate planning, your assets will be subject to the laws of intestacy, which are the laws which control the assets of people who die without a will. A description of Colorado’s plan for your assets can be viewed by clicking here, or you can try the “Intestacy Calculator”

Those you want to benefit may be family members, individuals outside your family, or charitable organizations. You may want to benefit different family members than those that would benefit under the state’s plan. Or you may want to benefit the same family members but in a different way. For example, in a second marriage situation, the state presumes that you would leave some of your assets to your surviving spouse and some of your assets to your children. Yet, many of my clients want to ensure that the surviving spouse benefits the most, if not entirely, by the assets. In other cases, my clients want their surviving children to receive most, if not all, of their estate. However, the state’s plan would provide for the children of a deceased child, that is, the grandchildren, would receive the deceased child’s share.

Many people do not want their estate to follow the state’s plan for minor children who inherit. The state’s plan is for the minor’s inheritance to be controlled by a conservator until the minor reaches the age of majority. In Colorado, that age would be twenty-one. Many of my clients are uncomfortable with the idea of giving a twenty-one year old complete access to the inheritance. Other clients want to make sure that a minor child’s parent, who may be an ex-spouse, is not given control of the minor’s inheritance.

Then there are the non-family members we may want to benefit. The state’s definition of family is more narrow than the concept many other people embrace. For example, stepchildren are not provided for in the state’s plan. Some of my clients want to leave assets to an ex-spouse, which can only be accomplished by estate planning executed after the divorce is final. Others want to benefit friends, employees, or other people who have been important in their lives. None of this can be accomplished without estate planning.

Neither can your estate benefit any charities without conscious planning of your estate. Whether it’s a gift of a specific dollar amount or asset or a bequest to a charity that would take place only if your closest family members are no longer living, the state’s plan never contemplates that you would have wanted to provide for anyone but family.

As a closing caveat, I want to point out that estate planning isn’t the same as having a will. Estate planning also includes naming the beneficiaries of your life insurance, placing your assets in trust, or gifting assets while you are alive. As I’ve said before and will most likely say again, it’s not the documents that matter. What matters are the conscious decisions made after careful thought, usually with the aid of counseling from a qualified attorney. That’s estate planning.