Is a Will Obsolete?

Is a Will Obsolete? In my opinion, the Will is not completely obsolete, but it is close.

A Will requires Probate

That surprises many people. They think that by writing a Will, the are avoiding probate. This just isn’t true.

A Will requires a Court to validate it and admit it for administration. Only then is the Will active.

No Lifetime Protection

A Will doesn’t provide any lifetime protection for you or your assets. A Will is only active after it has been validated by a Judge.

It takes a Durable Power of Attorney and a Healthcare Power of Attorney to provide lifetime protection for you.

Medicaid Recovery

A Will alone exposes your home to “Medicaid Recovery.” Even though Medicaid lets you own a home, when you pass, they can put a lien against it. As part of probate, that lien must be paid even if it means selling the home.

Creditors

Creditors can put their claims in during Probate. They will have to be paid as part of the Probate process. Even if it means selling assets, the claims must be paid.

What to do Instead

You need to use more than just a Will.

For your lifetime protection you need a General Durable Power of Attorney and a Healthcare Power of Attorney. These name the person (or people) you want to manage your financial, personal, legal, and medical affairs if you can’t.

You need to work with an attorney well versed in estate planning. They have methods to pass your real estate and other property outside of Probate without a Trust. Arkansas has types of deeds to pass real estate outside of probate and avoid Medicaid Recovery.

Here are a few reasons to use a Trust based plan:

• You have minor children
• You have children with special needs
• You have children with addictions to drugs, alcohol, gambling, …
• You have children with rocky marriages
• You worry about children divorcing
• Your children have trouble managing money or have credit issues
• You want to leave complex instructions or sell everything and split the money

Conclusion

Is a Will Obsolete? Not completely, but it is at the beginning of its end. The only reason you really need a Will is as a safety net in case something isn’t handled otherwise.

No Probate = No Creditors

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