Determining your Testamentary Intent and Avoiding Common Mistakes

Determining your Testamentary Intent and Avoiding Common Mistakes

I truly believe that everyone needs a will and have provided reason after reason why you need to create a Last Will and Testament ASAP.  These reasons include:

  • Proper Distribution of Assets – Both in terms fo what you want and what is most efficient
  • Guardianship Issues – Who is going to take care of children of you pass away?  your spouse passes away?
  • Instructions how to wind up Businesses – Are you going to have a one child take over the business? All of them  own it? Your spouse on it?
  • Use of Creditor Protection techniques

What is Testamentary Intent?

Once you agree that you need a Will we have to figure out your Testamentary Intent.  The simplest definition I can think of for Testamentary Intent is having what you want to happen, actually happen, when you die.

Want a more complex one? From Free Dictionary (I don’t have my Black’s Law Dictionary handy):

testamentary [ˌtɛstəˈmɛntərɪ]

adj

1. (Law) of or relating to a will or testament

2. (Law) derived from, bequeathed, or appointed by a will

3. (Law) contained or set forth in a will

Seems simple enough, right?  However, when I review Wills, there are a few common mistakes that at the time of their drafting, had great intentions, but when brought out to their eventual end probably do not follow the testamentary intent of the testator.

Common Examples of Testamentary Intents Gone Wrong

Below are some examples of common provisions that I see, that seem correct but when brought out 20 or 30 years, are not what the testator had originally envisioned:

  • Unequal Distributions- Sure, “All jewelry to Daughter” seems like the ‘right’ thing to do, since you don’t want the evil daughter in laws to get their hands on it, BUT what about future/existing Grandchildren? What about the worth of that jewelry – you have effectively given more to your daughter this can lead to animosity
  • Failure to Properly Plan for Children with Special Needs- Two common scenarios when parents have children with special needs are (1) Cut that child out completely for fear of losing government benefits or (2) do nothing.  Both are horrible!  In the first scenario, that means the child with special needs’ share would go to the typical child…what happens if that child has creditor problems? What if that child, like 50% of typical developing children gets a divorce?  Worse is to do nothing, and then let that child inherit their equal share…First, their gov’t benefits are stopped, next they use all that money to pay for otherwise covered items – and then after all that they are lucky enough to try and reapply for benefits.   RESEARCH AND IMPLEMENT ADVANCED PLANNING FOR CHILDREN WITH SPECIAL NEEDS.
  • Failure to Utilize Spendthrift Protection - Every State, to varying degrees, allow for the protection of inherited assets from creditors and divorce through the use of Trusts.  Most people assume that they don’t have enough money to justify trust creation – You are wrong.  Every dollar that you worked hard for, deserves to be protected to the extent that the law allows.  Those Wills that do utilize Trusts often have a magical age where the assets are disbursed, this age is often 30 or 35…but the ‘child’ is already 40 with 2 divorces under his belt and a slew of credit card debt!

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