Just in Time for Football Season
Dying without an estate plan – a condition known as intestacy – can result in many difficulties for those who are left behind.
Many people fail to plan ahead because they expect to live for many more decades. They assume that they will have some advance warning about death or incapacity, and they don’t give the matter much thought while they are still relatively young. Such thinking can be reckless, especially if you have a spouse and children who rely on your income. It is easy to assume that estate planning is more important for older people because they are more likely to pass away. This is true, but senior citizens usually don’t have minor children who are depending on them.
On the other hand, many young adults do in fact have children. In our society, two incomes are usually necessary to support the typical young family. If you remove one of these sources of income suddenly without making plans in advance to protect the children, they may be placed in a very difficult situation. With all of the above in mind let’s take a look at the estate of the deceased NFL quarterback Steve McNair, a multimillionaire who died without a Will.
When you pass away without a Will, the probate court supervises the administration of the estate. Eventually, the closest relative or relatives will inherit the probate assets after outstanding debts have been paid. It can take a long time to sort everything out, especially when there’s a lot of property involved. Steve McNair made many millions of dollars during his life, so the administration of the estate was indeed complicated.
If you properly draw up your estate plan with help from an estate planning attorney, you include the choice of an executor or executrix. This individual handles the administration of the estate. The court supervises, but the executor actually does the legwork. When there is no Will, the probate court has to appoint a personal representative serve in lieu of an actual executor.
In the case of Steve McNair, his widow Mechelle was appointed personal representative. Because of outstanding debts, particularly estate tax responsibilities that could have been mitigated with proper planning, McNair’s assets were unavailable to his family during an extended probate process.
Some people are in a position to provide support to their parents, and Steve McNair was one of them. He even had a dream house built for his mother in Mississippi. She thought the house was hers, but legally it was in her son’s name. It became part of the estate that Mechelle was administering. McNair’s widow had the right to ask his mother to pay rent. She set the price at $3,000 a month, and McNair’s mother Lucille wound up vacating the property because she was unable to pay rent of this magnitude.
Make No Assumptions
You may feel invincible as a young person, but you never know what the future holds. When you assume that you will always have time to plan your estate at a later date your family may end up paying a heavy price.