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Whether a Will or a Revocable Living Trust is best for you depends on your goals and situation.
An estate planning lawyer can help you review the pros and cons of each based on your needs and desires.
A Revocable Living Trust is more flexible than a Will, and may help married persons avoid Minnesota’s estate tax. However, a Revocable Living Trust is more expensive to set up, and requires you to proactively assign various assets to your Trust for your Trust to work properly. » Read more..
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Minnesotans in a 2nd marriage that fail to sign a Will before death may fall victim to unintended consequences.
Minnesota law applies when there is no Will, and those laws may not be what the parties to the 2nd marriage expected.
For example, spouses often expect to inherit all of their deceased spouse’s assets even when spouses are in a 2nd marriage. That expectation is wrong if the deceased has children from a 1st marriage and the deceased did not create a Will giving everything to the surviving spouse. When there is no Will, but there are children from the deceased’s 1st marriage, Minnesota law states that the surviving spouse is to receive “the first $225,000” plus ½ of the rest. The other assets go to the deceased’s descendants. » Read more..
Pre-nuptial agreements are most commonly used, and probably make the most sense, when the persons contemplating marriage have children from a previous marriage and desire to protect the children’s inheritance. Pre-nups may also have merit when the net worth of the two parties are vastly different, or when one party has business interests that need protecting so that a later divorce doesn’t create havoc for the party’s business partners.
However, for most first marriages, a pre-nup may cause more harm than good. » Read more..
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Consider these consequences if you die in Minnesota without an estate plan: » Read more..
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An oft-told tale describes a young man’s efforts to entice a beautiful woman to marry him because he would soon inherit $20 million from his ailing father. Impressed, the woman asks the man for his business card. At their next encounter, the beautiful woman introduces herself as the man’s stepmother – i.e. showing that women are better financial planners than men.
This imaginary woman’s expertise in financial planning is based on laws that provide for surviving spouses before providing for a dead person’s children. The young man was now going to have to wait for his new stepmother to pass on, which – if this was a May-December romance – could be some years from now. » Read more..
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Adults entering second marriages, but having children from a first marriage, should have a pre-nuptial agreement, a trust, and a qualified retirement plan waiver. Relying on a trust alone may not work because the new spouse could challenge the trust under Minnesota law. And, the only way that a new spouse can be waived as the beneficiary of a “qualified retirement plan” is if the new spouse does the waiving. » Read more..
Your best-laid plans for the distribution of your wealth at your death may go badly awry if you stumble with the titling of your assets and/or designation of beneficiaries.
For various types of assets, your beneficiary designations trump any language in your will or trust. Meanwhile, your trust is worthless if there is nothing in it. To make things even more confusing, assets that are “jointly held with right of survivorship” transfer outside your will and trust to the other joint holders of the asset. » Read more..
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