By Jackie Bedard, Carolina Family Estate Planning
Comfort and convenience aside, there are good reasons to protect your family’s privacy after you die. You may recall that Elizabeth Edwards’s will was released a couple weeks ago. You may have noticed that the provisions of the will were wide open to the public. But then, if you read on further, most of Ms. Edwards’s estate went straight to her revocable living trust. Where it goes from there is nobody’s business besides the trustees and benefactors of the trust.
I find as a Cary trusts lawyer that many people don’t realize the privacy issues that will face their family should they die without a living trust. That’s because upon your death, everything you are leaving behind to your loved ones automatically becomes a matter of public record—even if you have a will or other estate planning documents in place!
While this may feel like a huge violation from a privacy perspective, it also presents a safety issue to those inheriting your estate. There are a lot of unscrupulous people who prey on widows and other beneficiaries and try to separate them from their inheritance.
So why does the state make this information available to the public?
The lack of privacy is understandable if you know the true purpose of probate. One of the primary purposes of probate is to make sure the creditors of the deceased person have an easy way to collect any debts they are owed from their estate. For that reason alone, the probate process must be open and public.
This information is also made public so the creditors of your beneficiaries have notice that they are inheriting an estate. Under this scenario, the creditors could bring an immediate claim against your beneficiary, which may ultimately result in your beneficiary never receiving the inheritance you wanted to leave them.
However, to be clear, I am in no way advocating that debts go unpaid. In fact, you should instruct your executor to pay your debts. But, wouldn’t you rather direct how this process goes rather than leaving it to the courts?
One way to do that while simultaneously stopping the violation of privacy and loss of control of your estate is to create a living trust.
Unlike a will, a living trust is a private document that will not become a matter of public record because it does not have to be filed with the probate court. Therefore, you can name beneficiaries and provide gifts while still attaining privacy, since only the trustees and those involved in trust administration will know the contents of a living trust. This means that no creditor of yours or your beneficiaries, no disgruntled relative, no scam artist, and no nosey neighbor need know the details of your financial history.
Remember, there are people out there who make a living preying on young or vulnerable people that have just inherited something from an estate. They troll these public records daily looking for victims of their next heist or scam. Fortunately, with a bit of planning, you can protect your family from such privacy violations that accompany the probate process. I recommend talking to your Cary trusts lawyer about living trusts and how they can help your family if something unexpectedly happens to you.
Fortunately, we’ve made that process easier than ever by making 8 Peace of Mind Planning Sessions available to readers. Simply call 919-443-3035 and mention this article to reserve your spot. Your family will thank you for it!