Many people think that they do not need an estate plan because their estate will be too small, or that lawyers always recommend estate planning just because they “have to.” There are a lot of myths out there saying that, if you have a small estate, estate planning “isn’t worth it” or “probate will be quick and easy.” The following is a story of a husband and wife who had a small estate and were probably told those exact things.
The husband passed away with no will. Probate would not have been necessary at all but for his name being on the deed to the house. So we opened up an estate – a full administration - and appointed his daughter as the administrator. Why did this have to be done for such a small estate? Another law firm was handling the gentleman’s wrongful death claim and someone needed to be appointed to get his medical records from the hospital (as I recall this was for asbestos-related litigation).
Normally, we wait until six months after a person’s death to file the papers with the probate court. However, due to the pending wrongful death case, we needed the medical records ASAP. So we opened up the estate about two months after he passed. The probate case was going well – it was a shame we had to go to court just to transfer some real estate – but at least there were no issues.
This was until creditors started filing claims: one claim for a credit card that he had, and one for some outstanding medical bills. A common concern is that creditors or Medicaid will “take the house,” and that didn’t happen here. In this case, the estate was insolvent and the surviving spouse’s rights took precedent over the creditors’ claims. However, it did delay the transfer of the real estate into her name, and by extension, it slowed down the completion of her estate plan. Going to probate court also ended up costing more than a basic estate plan would have.
If you are unsure whether it’s worth it to set up an estate plan, I can assure you that it’s not worth it to go to probate court in the vast majority of cases. Whenever you feel that it is time to make some estate planning decisions, or if you would just like some more information, feel free to give us a call at 740.346.2899 to request one of our FREE guides or to Schedule a Consultation with us.