By Steve Worrall, Cobb County Probate Lawyer
Avoiding probate in Cobb County, Georgia, is a very real concern for people who want to make sure certain assets such as stocks, bonds, brokerage and bank accounts automatically pass to their heirs upon their death.
In such a scenario, Transfer on Death Agreements (also known as TOD’s) can be a very useful and convenient estate planning tool in making sure your loved ones are financially taken care of in your absence.
Essentially, Transfer on Death Agreements allow you to pass ownership of your accounts directly to a beneficiary of your choosing when death occurs. Without such designations, each account would have to go through the probate court before it can be distributed to your desired heirs.
Yet you may be wondering, “What’s wrong with going through Cobb County probate and why bother with tools such as TOD’s to avoid it?”
Well for starters, many people wish to avoid involvement with the Cobb County Probate Court simply because it could take a year or longer before the funds actually reach your desired beneficiaries. This is problematic for families who desperately need the assets to pay for burial expenses, outstanding medical bills, mortgage payments, and general living expenses.
Not to mention, the value of your assets passing through probate may be reduced by as much as 2-8%, as attorney and mandatory court fees will be taken directly out of the estate.
Finally, one of the greatest drawbacks of probate is that the value of your assets will be made public for the whole world to see. This aspect of Cobb County probate is especially troublesome for people who do not want every scam-artist or busybody in town knowing what their heirs stand to inherit upon their passing.
Yet it is important to remember that while TOD agreements will help you avoid probate on some of your assets, it won’t help you avoid probate on the rest of your personal effects such as jewelry, collections, family heirlooms, the contents of your home, etc.
Nor will TOD agreements help you minimize the amount of estate taxes your family might have to pay upon your passing or protect your assets if incapacity and not death occurs.
That’s why it’s so important you speak with a Cobb County probate attorney before making any decisions about your financial or legal affairs. While a TOD is indeed a useful estate planning tool that can help you avoid probate, it may not be the best – or the only tool your family needs to ensure they are protected should something unexpectedly happen to you.
Resolving to get your legal affairs in order is one of the most important things you can do to make sure your family, wishes and assets are protected if something unexpectedly happens to you this year.
Marietta, Georgia- While many people focus on getting out of debt or getting organized for the New Year, estate planning is an equally important personal finance goal that should make every adult’s to-do list.
That’s because according to Marietta estate planning lawyer, Steve Worrall, far too many area residents are without plans to protect their family, wishes and assets should something unexpectedly happen to them. A recent Lawyers.com survey further reveals that only 35% of adults have a basic will or other estate planning documents in place should death or incapacity occur.
“Contrary to popular belief, estate planning isn’t just for the rich,” says Worrall. “At a bare minimum, every adult needs a basic will, power of attorney and health care directives in place to avoid a legal and financial nightmare if something unexpectedly happens to them,” he adds.
So what are these documents and how do they help you in a time of emergency? Worrall explains the following:
- Will- A will is a document that specifies what should happen to your assets if you pass away. A will may also contain guardian nominations to dictate who will care for your minor children if something unexpectedly happens to you.
- Trust- A trust is a legal entity that can hold title to property. With your assets securely placed in a trust, you can minimize your financial exposure to lawsuits, divorce and bankruptcy while alive. Upon death, a trust will keep your affairs private and out of the probate court. It also allows a great deal of control for people who do not want their inheritance going outright to their heirs if something unexpectedly happens.
- Power of Attorney- A power of attorney or POA gives explicit permission for someone to access your personal accounts, pay your bills and handle all other financial and legal affairs if you are incapacitated in an accident but do not die. Under the current privacy laws, even a spouse may have a hard time accessing personal information without such documentation in place.
- Advanced Health Care Directive- Also known as a living will, this document specifies your healthcare wishes if you are incapacitated in an accident and unable to speak for yourself. Such wishes may range from whether you want certain medications administered to when (if at all) to start life support in critical situations. This document also allows you to appoint the person best suited to carry out such wishes should incapacity occur.
“Accidents and serious illness happen every day without warning,” says Worrall. “That’s why it’s so important for any adult who has not tackled their estate planning to add it to their resolutions this year. It will save their family from years of headaches and thousands of dollars in unexpected costs should the unthinkable happen”.
About Steve Worrall
Stephen M. Worrall is an experienced family law and wills, trusts and estate planning attorney in Marietta and Atlanta, Georgia. He concentrates his practice in all areas of family estate planning, including including wills, trusts, guardians for minor children and incapacitated adults, probate and trust administration, and all areas of family law, including divorce, adoption and prenuptial agreements. He also helps families plan to protect their assets and their children in the event of their death or incapacity, and to transfer their whole wealth – their financial, intellectual, and spiritual assets – to their loved ones.
If one of your New Year’s resolutions this year includes getting your financial and legal affairs in order should something unexpectedly happen to you, I have a gift I think you’ll enjoy.
To be specific, I just put the finishing touches on a free report I wrote entitled, “What You Don’t Know CAN Hurt Your Family: 5 Easy Ways to Make Sure Your Children, Wishes and Assets Stay Protected Should Something Happen to You”.
In this report you’ll learn 5 easy ways to get your legal and financial affairs in order, just in time for the New Year. You won’t even need the help of an attorney for some of these important steps; simply follow my instructions in the guide and cross each item off of your “to-do” list as you go.
You’ll also discover:
- How to legally name guardians for your minor children in a way that will hold up in a court of law
- The difference between a will and a trust, and which tool you really need to make sure your family, wishes and assets stay protected upon your passing.
- The details about simple document you can use to give someone legal permission to act on your behalf if you were incapacitated in an accident but did not die (…and without this document, no one will be able to help you under the current HIPPA laws!)
- How to amass your “entire family wealth” and leave a true legacy to your children (hint: you don’t have to be wealthy and it’s easier than you think!)
- And so much more!
To grab a copy of this report, simply visit http://bit.ly/gNUxIJ.
I’d also like to encourage you to forward this to any of your family or friends who really need to get their affairs in order just in time for the New Year. I would especially encourage you to reach out to anyone who has minor children, owns their own home, cares for aging parents or is approaching retirement age themselves.
Again, you can get a copy of this free report now by going to http://bit.ly/dGpJM1.
All my best,
As a former Marietta divorce lawyer, I know that getting a divorce in Georgia can be an overwhelming process. There are so many decisions to make and things to do that it’s hard to keep everything straight. And as a Marietta estate planning lawyer, I also know there is one thing that divorcing couples must remember to do—and that is getting your will or trust updated.
Forgetting about your estate plan is understandable from any perspective. You’re so busy thinking about living arraignments, finances and custody agreements that you simply forget to contact an estate planning lawyer to make sure your spouse will no longer be the beneficiary of your estate once the divorce is final.
And while I admit estate planning is easy to overlook, it’s still something that must be taken care of either before you file or immediately after your divorce is complete.
This is especially true if you have a life insurance policy, retirement accounts, investments, property or even a joint trust with your current spouse. If you fail to take steps to create a single person trust or designate new beneficiaries on your other assets, your ex-spouse will still receive everything you own—even after you are legally divorced.
Similarly, if you don’t create an updated power of attorney and living will, your soon-to-be ex-spouse will be the only one with legal permission to make decisions for you if you are permanently or temporarily incapacitated. For most people, the thought of their soon-to-be ex making decisions such as medication administration, life-support or nursing home vs. home health care is frightening. Also, the ex most likely does not want that responsibility any longer. That is why it is critical to get these issues addressed at some point before or after the divorce proceedings.
However, there are strict time-frames as to when you can update/amend your estate planning documents during a divorce in Georgia, so please make yourself familiar with the following guidelines:
Updating Your Estate Plan Before Filing Divorce in Georgia
As a Marietta estate planning lawyer, I highly recommend you consider revoking and restating all of your estate planning documents before filing for divorce. This includes updating your advanced healthcare directive (also known as a living will) and financial power of attorney so someone other than your spouse has the ability to make financial or medical decisions on your behalf if you are unable. This is especially true if you’re gearing up for a messy divorce which could likely drag on for a number of years.
You’ll also want to change the beneficiaries on your life insurance policy, retirement accounts and other investments. If you have a joint trust with your spouse, you’ll need to talk with your Marietta will and trust lawyer to find out whether you must provide notice to your spouse before it is revoked.
Updating Your Estate Plan During Divorce Proceedings in Georgia
During your divorce proceedings, the ability to revoke your trust or name new beneficiaries on certain accounts can be halted. What’s known as an Automatic Temporary Restraining Order (ATRO) or a Standing Order will kick in to ensure your assets and ownership interests stay the same until an official division of assets and ownership interests takes place. Therefore, it’s important to note that if you pass away during this time, your soon-to-be ex-spouse will still become the beneficiary of your estate. You can, however, update your will, power of attorney and living will during this time to minimize the amount of power your ex-spouse would have if something unexpectedly happens to you.
Updating Your Estate Plan After a Divorce in Georgia
After the divorce proceeding, you are considered a single person in the eyes of the law. You are free to update, revoke and amend your estate planning documents as you see fit. However, as a Marietta GA will and trust lawyer, I’ve come to find that many people falsely believe their spouse is no longer entitled to their assets once the divorce is officially granted. While it’s true that some estate planning powers may be automatically revoked after the divorce (such as the ability to speak for you medically if you were in an accident), if you have outdated legal documents in place that still include your ex-spouse, he or she will still be the legal beneficiary of your estate or specific assets upon your death. Therefore, it’s important to make sure every legal document you have is updated immediately following your divorce.
When to Get Help
I always advise people in Georgia to at least meet with a Marietta estate planning attorney, in addition to their Marietta divorce attorney before ultimately filing for divorce. That’s because it’s important for you to know exactly how the divorce proceedings will affect you and/or your children, especially if you become incapacitated or pass away suddenly during the process.
With so much going on during divorce it is difficult to think about adding another legal process. However, it is critical to make sure your estate plan reflects your new circumstances to avoid everything you own going to your future ex-spouse if you pass away or avoid having him or her legally responsible to make medical or financial decisions for you in the event of incapacity.