Editor’s Note: “Dollars and Sense” is a new column in the SunBird News dedicated to financial issues. This column is designed to provide accurate and authoritative information on the subject of personal finances. The publisher shall not be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential or other damages. As each individual situation is unique, questions relevant to personal finances and specific to the individual should be addressed to an appropriate professional to ensure that the situation has been carefully and appropriately evaluated. Robson Publishing, a division of Robson Communities Inc. is not liable for information contained in these articles.
Francisco P. Sirvent
Keystone Law Firm
If you have established a living trust, you are in the minority. AARP discovered in a 2000 survey that only 17 percent of people had the three foundational documents to a good estate plan: a power of attorney, last will and testament, and revocable living trust.
But having those documents is not a guarantee to avoid probate. Here are six quick things you can do to make sure your financial affairs will not be taken over by the probate system and probate attorneys:
1. Organize and consolidate. Do you have a list of all of your property, accounts, insurance and investments? Is that list easy to find? Do you have recent statements for each account? Do you have redundant accounts (multiple checking or savings accounts for no specific purpose)? These issues all create extra expense and headache for your successor trustee. Simplify your financial life by consolidating redundant accounts, making a master list that includes everything, and keeping these records somewhere that will be easy to find.
2. Fund your trust. A trust can only avoid probate for the things it owns. Your trust name must be registered properly on each account and real property.
3. Keep it up-to-date. Your documents need to be current as of the day you pass, not just the day they were signed. Review your documents to see if they still match your desires (your successor trustee or your beneficiaries). Get your plan reviewed by a professional to see if any new laws affect your plan.
4. Write a love letter. Those you leave behind want to know that you were proud of them. Put that in writing and keep it with your legal documents.
5. Collect passwords. Online accounts are at risk of being frozen if your successor trustee does not have the username and password. Develop a plan to transfer passwords to someone you trust if you become incapacitated.
6. Find your originals. How easy/hard is it for you to put your hands on your original power of attorney, last will and testament and living trust right now? Imagine if your named successor trustee had to look for it today. Move your originals to somewhere they would be easy to find and accessible. Then store backup copies in a safe and secure location.
Keep this checklist handy and review it once a year, maybe right after you get your taxes done.
Mr. Sirvent is the owner and Managing Attorney of Keystone Law Firm. He also is a founding member of the WealthCounsel Arizona Forum, LLC, a professional organization of Arizona estate planning attorneys committed to high-quality estate planning. He has been engaged in the legal profession since 2002 and is licensed to practice law before the Arizona Supreme Court and the Federal District Court of Arizona and is a member of the Arizona State Bar Probate and Trust Section and Elder Law and Mental Health Sections. Mr. Sirvent concentrates his law practice to transferring wealth and preserving values between individuals, families and businesses. This includes general estate planning, sophisticated tax planning, charitable planning, business continuation planning, and (when things go wrong) probates.