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How Houston, Texas residents can save money with proper estate planning

One thing that many of us have been in search of during the past year is control. The pandemic has taken what control we have over our lives away from us. This is true regarding our health, schedule, ability to interact with others, and countless other areas of our lives. While we hope that the pandemic will come to an end soon, I think it will be a lasting impact from this past year that we are all going to search for ways to be more in control of our surroundings. Whether or not we can always do that will be the big question that we will continue to encounter for some time to come.

However, there certainly are areas of your life that you can exact a great degree of control over regardless of what is happening with a pandemic or any other issue for that matter. Saving money may not always be in our direct control, but I think there are practical, responsible ways for you to practice good habits when it comes to your finances. Some don’t even involve clipping coupons or making sure that you are putting enough into your retirement accounts each month.

Specifically, I am thinking about saving money by paying attention to the details in estate planning. I realize that estate planning is not the most interesting subject globally, but it is important, nonetheless. I want to help you walk through why drafting a will is important and how it can help you save money. If you have any questions about the information that I have included in today’s blog post, please contact the Law Office of Bryan Fagan. Our attorneys would be honored to help you and your family plan for your future.

What can a will do to help you achieve financial peace?

When you create a will and sign the document, you are known as a testator. That is the legal term used to designate the person who leaves a will in place at the time of their death. In the will, you state how you want to see your property treated, handled, and distributed at the time of your death. Dying without a will frequently create problems for your family in many ways. Not only are you not able to dictate what you want to happen with your property if you were to pass away without a will, but you are also causing problems that may end up costing your family money in attorney's fees and other expenses.

In your will, you can name the specific people that you want your property to go to whenever you die. If you pass away before your children reach adulthood, you can also name a person who will manage your property until you are old enough to care for it themselves. If you are married at the time of your death, you would likely name your spouse as a beneficiary to receive your property. Your spouse would likely do the same. The larger your estate is, the greater likelihood that you could be taxed for passing property to your family when you die. There are ways to minimize estate taxes by proper estate planning.

Can a will set up a trust to be used after your passing?

A will can set up a trust which can help to hold your property for the benefit of your children. In most cases, you would set up a trust to be maintained by a person named a trustee. That trustee would likely be a family member or other trusted individual who would be able to keep track of all property within the trust to maintain it the best way possible for the benefit of the trust's beneficiaries. If you are married, your spouse would include mirror language in their will to establish the same trust if both you and your spouse die at the same time.

The trust does not go into effect until you die. Until then, it serves no purpose, and no trust is created. Specific property within the will could be transferred into the trust to be maintained by the trustee for the benefit of your children or any other person that you choose. If you have older children who are not quite at an age where you trust them to spend money wisely, then a trust Is a great tool to use to hold property until they reach an age where they would ostensibly have greater maturity. You can select any age you choose for the property to be conveyed by the trustee to your beneficiaries.

In an age where seemingly everyone owes a debt or two to someone, keeping the property in a trust would also prevent your children's creditors from attaching liens or seizing property in exchange for paying off debt. If you have specific questions about this scenario, I recommend reaching out to one of our attorneys for answers. There may be situations where an adult child's creditor may be able to reach into a trust to satisfy a debt.

What does a will have to be fully executed?

Just like final orders in a family law case, your will must bear certain characteristics to be enforceable. Without these characteristics, the will is not worth the paper that it was printed on. To avoid putting your family into a situation where time and expense need to be paid to get to the bottom of your desires with your property, you should take care to ensure that you have fulfilled the obligations that the State of Texas has placed on wills.

Fortunately, there are not many requirements that must be in place for a fully executed will. First, you must be over the age of 18 when your will is signed. Next, the state requires you to be of sound mind when completing the document. This means that you must not be under a conservatorship order of any sort and must be able to make decisions independently. As long as you were not pressured or induced to make the will and have the proper intent to pass your property at your death, then your will be valid and enforceable.

Must your will be in writing?

Yes, for you to have a valid and enforceable, it must be in writing. The state of Texas does not honor oral wills. So, if you envision yourself making pronouncements about your property on your death bed to your family members, then you should plan on going another route to ensure that your property ends up where you want it to. Simply writing down what you want to see happen is all it takes. As you are about to see, it doesn't even take you to use a computer or word processor to satisfy the requirement that you will be written down.

The State of Texas honors handwritten or holographic wills. The Texas Estates Code contains the requirements for holographic wills beginning by telling us that the holographic will must be completely in your handwriting. This means that if you start the will and get halfway through, you cannot pass it over to your brother for him to complete. This is true even if you sit next to him and tell him exactly what to write. You must write every word by hand if that is your intent.

Here is the nice part: a handwritten will does not have to be done on legal paper. Grab a napkin and a marker, and you have the beginnings of a valid will. Note that once you start a handwritten will, you can’t switch to typing the rest out if your hand gets tired. It needs to be completely in your handwriting. Are there any magic words that must be included in your handwritten will to show that you have the intent to pass down your property to a person or other entity? If you include the phrase: "This is my testament," then you are probably in the clear as far as that requirement is concerned.

Here is where drafting a will can either save your family money or cost your family money. Handwritten wills are notorious for being tough to interpret. Often, older folks who are close to passing away will grab anything close by and write down their thoughts and intentions as far as what they want their property to look like after they pass away. Although these folks have good intentions, the reality is that sometimes their handwriting is illegible or otherwise unclear. If you are not clear in naming your property and how you want it disposed of, you can almost bet that someone in your family will contest the will and ask a probate court to review the situation. This will cost your family not only time but also money.

Typing a will out can save you time, money, and hassle in the long run.

Most people nowadays choose to type a will out rather than write it out longhand. This is a reflection of the ease with which most people use computers compared to generations past and how much easier it is for the will to be enforceable and valid when written on a computer rather than handwritten. Many persons who want to have a will drafted will choose to hire an attorney to represent them. This accomplishes a couple of things that can help your family to save money over the long term.

For one, hiring an experienced estate planning attorney will allow you to feel confident that your will would hold up in court if it were to be challenged. The last thing you want is to pass away with a will that is not valid or enforceable. That would mean that all the time you spent drafting the document was pointless. If it is not enforceable at the end of writing the will, then you may as well not have spent the time drafting it in the first place.

That isn’t to say that a will cannot be typed out by you, your spouse, or your child. You can surely dictate a will to someone who can type it out for you. That happens all the time. I have done this for relatives of mine. However, this does not mean that you should immediately go to your daughter-in-law to draft your will before considering an attorney to do the job. Again, hiring an attorney may cost you some money in the short run, but it can save you and your family money in the long run. More importantly, it can help ensure that your property is handled the way you want it to at the time of your passing.

You must sign the will, no matter if the rest of the document was written by a computer’s word processor. Another person (relative) may sign your will for you if you are unable. However, you must make it clear in the document that this is being done and that you instructed the person to do so, and you were present at the time of the signing. The signing must be witnessed by two other persons over the age of 14. Please do not sign the will; take it to your neighbors and ask them to sign the will as witnesses. Your witnesses must watch you sign, and then they must sign the document or vice versa. Last- do not allow a beneficiary to witness the document. This could present a conflict of interest type situation where your beneficiary may not inherit from you if the will is contested at a later date.

Can you change a will after it is signed?

Once you have a will that is signed and witnessed, then you should keep it someplace safe. A literal safe may be a good place for it, but keep in mind that if only you know the combination and then pass away, this could present a problem to the person named as executor and any beneficiaries under the will. So, a for the will on your bookshelf or even a secure dresser drawer would not be the worst place in the world to store your will until it comes time for it to be put to use.

There may be changes in the will that are necessary after it is drafted. Life will continue to go on for you and your beneficiaries after your will is drafted. You may have heirs be born or pass away. You may gain or lose the property. You may even get a divorce between the time your will is signed and you to pass away. These life events should cause you to reconsider your will and determine whether or not changes need to be made. You will have a choice to either modify the will via what is known as a codicil or in creating a brand new document.

What is not recommended is to take a pen and scratch out language that is no longer valid or current, and in the margins of your current, you will write down the changes that need to occur. This puts you in a situation where the document may not be declared valid by a court in the event of a challenge. In some situations, a court could hold the initial draft of the will to be valid, and no honoring of the changes will occur. It may also be the case that the entirety of the will is not honored, and the entire document is thrown out in court.

Divorcing after the creation of a will can be a tough circumstance. A probate court likely would not allow your ex-spouse to be named as a beneficiary under your will or to act as the executor of your will. The same goes for life insurance proceeds. Let this be a lesson for you that you need to go through documents like wills and life insurance policies to update your information in the event of major life events. Getting married again does not void a prior will. Create a new will wherein you give all your property to your new spouse. Please do not put your new spouse in a situation where they have to go to probate court to fight for what should be theirs because your will was never updated after it was initially created.

Questions about the material contained in today’s blog post? Contact the Law Office of Bryan Fagan

If you have any questions about the material contained in today’s blog post, please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed attorneys offer free-of-charge consultations about the material contained in our blog posts six days a week via phone, video, and in person. We value the ability to help our community by providing top-notch legal representation at an affordable, reasonable cost. Call us today to find out how we can help you and your family plan for your future.

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