The Bucket List
By Richard Senasac, Attorney, Looney & Conrad
People don’t like to think about death. Who can blame them? But we all need to make preparations for the future. The time of a loved one’s passing is a bad time to find that there are things undone that will make life for the survivors that much harder. In order to spare your loved ones additional grief, everyone should have a Bucket list…things to do not for yourself but for others before you kick the bucket.
First is your Will. Most people don’t need a Will but everyone should have one. A Will is a document that tells the State of Texas who you want your property to go to on your death; it disposes of your stuff the way in which you want it disposed of. This is done by “probating” your Will which means filing it in probate court and having an Executor appointed by the court. Nine out of ten people when they pass on will not leave an estate that needs to go through any type of formal probate. But those that need a Will really need it. Having a Will may save months, or even years of probate and thousands of dollars in expenses.
Second is designating beneficiaries. This is vitally important. This keeps assets out of probate and saves time and money and grief for those left behind. Many assets including some bank accounts, insurance payments and brokerage accounts, pass “outside” of probate. That means they are transferred to the people the deceased person designated while he or she was alive due to arrangements he or she made while alive, with the bank, insurance company, etc.
Even in other cases, many stocks can be transferred to heirs by filing out simple paperwork with the company that issued the stock or with the broker that handles the stock. Designate beneficiaries and substitute beneficiaries for your life insurance, your retirement, etc. In any of these cases, the most important thing is to confirm that the paperwork has been filled out properly. Mistakes are common and costly. Do not take a worker’s word; look at the papers and confirm they say what you mean for them to say.
Third is similar top that; bank accounts with right of survivorship. A right of survivorship on an account lets it pass to the person listed with the bank outside of probate. This means that the funds are transferred in a simple manner without the need for any lawyers or court intervention. You should check with your bank to confirm that they offer these services and specify which you prefer.
Fourth is not specifically tied to your passing but are things you should have. I’ve spoken of durable powers of attorney and medical powers of attorney. These are effective tools for handling financial and medical decisions, but far from the only ones. A directive to physicians allows you to make medical decisions beforehand without involving an agent; YOU say what you want done in a given situation including issuing do-not-resuscitate orders.
A declaration for mental health treatment is the mental health version of this. A designation of guardian lets you choose who would be first in line to be your guardian in the case you need a court-ordered guardianship. A declaration of appointment of guardian allows you to do the same for your minor children should you die.
Fifth is the transfer of property. Real property can be transferred to loved ones during your life while retaining the right to live on the property, thus avoiding any need for probate. A life estate can be retained when you execute a deed giving (or selling) someone real property, so you have the right to continue living on the property for your life. A “Ladybird Deed” lets you give real property to someone but retain the right to live there and even mortgage or sell the property. A transfer on death deed automatically grants title to the people listed in it on your death. Trusts can manage funds, other assets and real property for anyone you choose to, including yourself, minors or even other adults.
These are only brief descriptions of the documents mentioned. If you are interested in having these, investigate them further and talk to an attorney. While designations of beneficiaries and setting up bank accounts can be done without help, the others require that you visit a lawyer. Be warned, the “forms” provided on the internet are a trap for the unwary and can do the opposite of what you want; to make things easier on family and friends after you kick the bucket.