Due to these crazy and unprecedented times that we find ourselves in, estate planning has become a hot topic. After all, the only thing in life that is guaranteed is death and taxes, so we might as well plan for it now. And, many people are coming to this same conclusion, but for those childless families, is it any easier?
In a word, no. Other than guardianship, a childless estate plan looks pretty much the same as an estate plan with children.
Second level of beneficiaries
In an estate plan that has children, the second level of beneficiaries, the level after our spouses, is our children, so it is an easy level. However, for childless families, the second level of beneficiaries becomes the most important.
First, be sure that each spouse’s second level of beneficiaries list is the same. This will ensure that there are not competing wills, should one spouse die before the other. After all, that is the statistically more likely scenario. If there are competing wills, this will cause litigation in probate court by all the beneficiaries, costing the estate money and the beneficiaries money in court and attorney costs. And, at the end of the process, the surviving spouse’s wishes will likely be upheld.
One way to ensure that both spouse’s beneficiaries are included in an estate is to create fractional shares of the marital property. This is for mathematical purposes and not actual property division. Within each of these percentages, each spouse names their beneficiaries and the amount each beneficiary will achieve. For example, if the husband’s share is 50 percent, and he wants to leave 50 percent to his brother, then his brother would be entitled to 25 percent of the total marital property.
Account for living longer than one’s beneficiaries
Do not forget to account for predeceased, like if one spouse dies before the other and if the beneficiaries die before either spouse. For example, in the prior example, if the brother dies before the husband, how should that 25 percent be divided to the brother’s children. Deciding this now will help avoid issues in the future. Of course, those looking to draft an estate plan should contact their Severna Park, Maryland, estate planning attorney.