What happens if you or a loved one does no estate planning? In other words, there is no valid will or trust that describes how assets are to be divided among heirs, who will be nominated as guardian for minor children, and who will be responsible for administering the estate. When this happens, we have what is called an Intestate Estate.

Ohio law sets out a specific order for who may administer an intestate estate. If the person who died (the “Decedent”) was married, the spouse is first on the list. Next in line is the decedent’s child or children, if they are over eighteen.  If there is no spouse and no children, then the decedent’s parent or parents are next, followed by the decedent’s siblings. Although a person may have only one spouse, there could be more than one eligible child, parent, or sibling.  Because each person at a particular “level” has an equal right to administer the estate, if the family members do not agree, then the Probate Court must choose an Administrator from among those who have applied, or select a neutral attorney from a list kept by the court.

There are certain requirements for Administrators. When there is no will, the Administrator must be a resident of the state of Ohio. Why? So that the court can exercise personal jurisdiction over that person if they mismanage the estate. The Administrator must be bondable. A bond is an insurance policy that will repay the estate if the Administrator does not properly administer the estate. The person applying to become Administrator must not have committed certain crimes or have such poor credit that they would be ineligible for a bond. A bond is required where there is no will, and the amount of the bond is usually double the amount of assets in the estate. The fee for the bond comes out of the estate assets. The Administrator also must be “otherwise suitable.” This is a broad description that gives the Probate court a lot of discretion.

If there is more than one applicant to be administrator who meets the minimum requirements (which happens quite often), how does the court decide who to appoint? The court will choose someone it thinks can be fair and impartial; someone who seems organized and willing to do the necessary work; someone who does not have a personal agenda or conflict of interest; and someone who is not likely to be influenced by others. If there is a high level of conflict in the family and it appears that no applicant meets these requirements, then the court will appoint an attorney as a neutral administrator.

The process of appointing an administrator to manage the estate can take months if there is disagreement among those  who are eligible to serve. During that time, nothing can be done to transfer assets or pay expenses, which can create a strain on dependents of the decedent.

Failing to plan can leave your family in a precarious financial situation,  can create conflict among family members, and will most certainly cause delays, often lengthy. Let’s find a time to put a plan in place so that doesn’t happen to your family!

Blogging the Seasons of Life RSS

Do you remember when turning 18 seemed like a big deal? We thought we would be adults and that magically we would no longer have to follow the same rules. We would be in full control of our lives.

It wasn’t quite that way, was it? And yet, in many ways it is that way. There are a group of rights that young people gain when they reach the age of majority, which in most states and for many federal laws is 18. The rights they gain correspond with a loss of control and access for their parents. These include the right to make their own medical decisions; privacy with respect to educational and medical records; the ability to inherit; the right to enter into contracts and apply for credit; and the right (in most states) to marry.

Yes, it’s a good thing that they are growing up, but are they really ready to fly solo? I would say no:, not without some critical documents in place. Young adults need some of the same planning documents that seasoned adults need.

Every adult needs a medical decision-maker for those times when we are unable to make our own decisions. Every adult needs to empower a person to assist with financial management when they cannot, or when they are unavailable. Every adult needs a basic will, placing someone in charge of wrapping up their affairs and providing direction about their intentions.

These are the bare minimum, and in many situations additional planning documents are recommended. Want to learn more? Register for my free seminar, “Before They Leave the Nest” here: (virtual) https://www.eventbrite.com/e/163247536777 or (in person) here: https://www.eventbrite.com/e/163250664131

Given all of the dire warnings about COVID19, what should you be doing to prepare? Here is what I am recommending to my clients, family and friends:

1.       WHO depends on you?

Make a contingency plan and line up a back-up individual to care for those persons - and animals - if you become ill and need to isolate yourself, or if you become ill enough that you are hospitalized.

2.       WHAT are your day to day responsibilities?

Do you have another person who has the ability and the tools to fill in for you? This could be work-related cross-training, educating someone on the home-front about pet care, home alarm codes, appliance operation, etc.

Do you have the proper tools in place? By this I mean Powers of Attorney – both financial and healthcare. These are essential tools.

3.       WHEN are critical upcoming or ongoing due-dates?

Create a list of when ongoing bills are due, so your agent knows when things need to be paid or when deadlines are for things like prescription refills, college deposits, camp registration, etc.

4.       WHERE are your important papers?

Create a roadmap for whoever may step in for you: where do you bank? what pharmacy are the family prescriptions refilled? where is your original POA? where is your will? where are passwords stored?

I am an advocate of planning. It’s what I do for a living, but even if I didn’t, I would still recommend reviewing this list, if only to put your mind at ease.

I get this question all the time!

An Estate is what you own, however much or little it may be. It includes your “real” property (real estate), personal property (your stuff: cars, jewelry, collections, grandma’s china boxed up in the attic), and intangible property (bank accounts, investments, royalties).

An Estate Plan is your instructions for how your Estate will be managed and distributed. Your instructions may be in the form of a Last Will & Testament, a Trust, Powers of Attorney, Advance Directives or some combination of those documents. An Estate Plan can be simple or complex, depending upon what you want to accomplish with it – which might have much more to do with your family structure than the size of your bank account.

One of the most important parts of the Estate Plan for families with one or more children is deciding who will care for your children if something happens to both parents. It’s a scary thought, but it’s a choice you will want to make for yourself, not leave to a probate judge.

Many people incorrectly think that an Estate Plan is only used once you have passed away. Actually, a well drafted plan is flexible enough to manage multiple possible situations, such as,

• While you are living but temporarily unavailable or unable to manage your affairs;

• While you are living but permanently unable to manage your affairs;

• When you and your spouse are both unable to manage your affairs;

• Immediately after you pass away; and

• Many years after you pass away.

A good Estate Plan will include documents that deal with concerns other than money and property, such as medical directives, guardianship designations, final disposition instructions and organ donation instructions.

Working with an attorney who has experience in estate planning will ensure that you have the tools you need to manage during your lifetime, and for your family to manage after you are no longer able to manage on your own, and after you are gone.  You will sleep better once you have a plan in place!