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ScenarioRobert Burns once said, “There is no such uncertainty as a sure thing.”  Even if you have an estate plan, you cannot control everything.  Sometimes, events happen that create confusion or even try to destroy your estate plan.  This blog addresses three worst-case scenarios that can happen to an estate plan, and how you can avoid those potential disasters.

Scenario One: Family Members Battle One Another

Even though you try your hardest to avoid it, sometimes your children fight over your property anyway.  They can fight over anything: who gets what, how to interpret some language, how to manage your business, and other create can re-open old wounds or create new ones.

If your children fight, they often have to sue your estate, which decreases your estate’s value and creates negative feelings associated with your passing.  Drama can also have more subtle effects, such as damaged relationships, or some family members working against other children however they can.  If it gets bad enough, these situations can also end in lawsuits and permanent relationship damage.

What you can do: If you think your family may be prone to this kind of situation, you may want to think about using an impartial individual to administer your estate.  This could be a trusted friend, an accountant, or someone that does not have an interest if your estate or your children.  An estate planning attorney should be able to help you identify this potential problem.

Scenario Two: Both Spouses Die Simultaneously

Most estate plans gives an individual’s property to the surviving spouse.  However, if both spouses die at the same time (or almost the same time), this situation can get complicated, especially if the spouses own separate property or there are estate tax concerns.  Who gets what property may be determined by which spouse actually died first, taxes, or other factors.

What you can do:

  • You can draft a clause in your estate that names which spouse will be treated as having pre-deceased the other.
  • You may decide to hold off on giving assets to your spouse for several weeks or months so that if the surviving spouse passes away within that delay period, there will not be doubled fees or taxes because of the two deaths.
  • Naming a final back-up beneficiary in case all the primary beneficiaries die at the same time.  While this situation is fortunately unlikely, it does happen.

Scenario Three: Passing Away Overseas

Not only does estate planning laws vary from state to state, but from country to country.  Americans living outside the United State may need extra planning to comply with US laws and the laws of the country they are living in.

What you can do: If you are planning on living outside the United States for an extended period, may want to read this New York Times article and prepare an estate plan consistent with that nation’s laws.  You will in effect have two estate plans, one for each country.

Final Thoughts

If you are unsure if your estate plan adequately takes a scenario like these into consideration, contact The Rains Law Firm or schedule a complimentary initial meeting to start that conversation and protect your property and your family.