Everyone needs an estate plan. While most people do not want to think about what is going to happen after they pass away, you do need to consider what happens to your assets. Most want to be able to pass on their assets and property to family members. While wills and trusts can do the trick, there are other forms of estate planning that you might be aware of.
In estate planning, one of the most common forms is joint ownership. With joint ownership, if something happens to you or your partner, then the survivor will have ownership of all assets. All titles pass to the joint owner. There are some benefits to joint ownership but there are also some downsides. Knowing the disadvantages and advantages can help you to understand if it is for you.
Creditor Problems
With joint ownership, if each person is not liable, then the creditors cannot touch the assets. However, if the partner who is not in debt dies first, then the creditors can seize those assets.
Reduced Flexibility
Sometimes, reduced flexibility is not a problem. Basically, you cannot do anything with the property without permission from the other owner. Now, if you are married to the joint owner, this might not be a problem. However, if one of you becomes incapacitated, it could lead to issues.
Probate Avoidance
This is one of the key advantages of joint ownership. Most people consider this type of ownership because it is not only cheaper than a standard will, but it will allow your family to avoid probate. Even though some states have a more streamlined probate process, it can still take time. Likewise, your survivors have to pay probate fees.
If you’re trying to decide whether joint ownership is all that you need, you may also want to look into other options. Wills and trusts can serve better and allow you more control over what happens to your assets when you are incapacitated or when you pass away.
In any instance, estate plans can be complicated. Every person has their own set of circumstances and with these circumstances come reasons why or why not different estate plans are a good idea. Before you settle on one solid plan, you should consult with an estate planning lawyer . A lawyer can help advise you on a plan and guide you through how to set it up to be a valid estate plan.
Thanks to Brandy Austin Law Firm, PLLC for their insight into estate planning and joint ownership estate plans.