Gifting

There was a time when most people heard about prenuptial agreements only when watching soap operas or Hollywood movies or reading a novel. For many of us, prenuptial agreements seemed to be reserved only for the ultrawealthy, where the continuation of dynastic family wealth was at stake.

In today’s digital age, many people have a library of digital assets that may include items such as books, music, and movies. One of the perceived benefits of owning these digital items is having a convenient way to access your favorite media indefinitely with just a few mouse clicks. However, is it as simple as it seems? How do you own what you cannot touch? And if you cannot handle it, how do you pass it on? For those who own digital assets such as digital movies, these questions are at the heart of a new and interesting paradigm.

Clients often naturally choose their children to be beneficiaries of their revocable living trusts. Many clients also wish to name one or more of their children as the trustee of that trust, but are not sure if that is allowed by the law. The short answer is yes, a beneficiary can also be a trustee of the same trust—but it may not always be wise, and certain guidelines must be followed.

When we think of estate planning, we often think about preparing our accounts and property to go to our loved ones in a tax-efficient way, protected from probate, disgruntled heirs, beneficiaries’ creditors, divorcing spouses, bankruptcy, and the poor spending habits of children or other beneficiaries. We rarely consider preparing for receiving an inheritance of our own.

Estate planning attorneys frequently hear from their clients, “I’d like to leave something to my grandchildren. What’s the best way to do that?”

Naturally, grandparents love their grandchildren and want them to succeed in life. And when grandparents are in the twilight of their lives, their hearts often turn to the younger generation with a desire to give them whatever advantages they can, especially if they were unable to give their own children those same advantages when their children were younger.

A critical question to ask yourself when creating an estate plan is who will get your stuff when you pass on? While most people think about who they would like to receive the major items—homes, retirement accounts, savings—personal property such as jewelry, clothing, sports equipment, vehicles, and other possessions are often overlooked. The truth is that while some mementos and sentimental items may be very valuable to you, the people that you want to give them to at your death may not need or want them. Who, then, will get your remaining property and possessions if no one wants them?

How Gifts Pass Through Your Will

Your will contains instructions to be carried out by your personal representative for who should receive the money and property that has become part of your estate when you die. Your estate consists of real property (i.e.
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How your accounts are owned makes a big difference in estate planning. The main objective is usually to ensure that no accounts and property are in only your name when you die. Otherwise, they will be subject to probate, a costly, public, and time-consuming court process that many people prefer to avoid. Therefore, it is important that you review your accounts and beneficiary designations to be sure that the death of your loved one has not compromised your previously established plan.

Accounts with beneficiary designations, such as life insurance policies, retirement accounts, and annuities, will be distributed at your death, without probate court involvement, to the beneficiaries you have named.
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Setting money aside for your children’s or grandchildren’s education is a great way to provide for their future. However, it is possible that not all of the money you have set aside will be used for college expenses. For example, your child may receive a large scholarship and will not need to use all the money you have saved, or your grandchild may choose a trade school that is less costly than you expected. Alternatively, your child or grandchild may decide to join the workforce immediately upon graduation. When confronted with this scenario, you may wonder what you can do with the excess money.
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