The Bible says,... it is appointed unto men once to die .... The Bible encourages you and I to be ready for that time of death that does pass upon all men. While the God of the Bible has Spiritual things in mind, many reading this may have financial matters in mind. But, first I would encourage you to examine yourself and see if you have really accepted Jesus. Is He really Lord? Do you ask Him if you should or should not do things? Make sure HE is Lord and you have received Him as Savior. There is nothing else as important. But, also you may wish to know: should I have a Will or a Trust or do I really need either? A single person who is holding everything in the joint name of his or her parents may not have a need for any of these instruments. But a person who has any property or assets not held jointly should decide if they want to decide where the things they own go or if they want the State to decide who gets what? To evaluate the need for a Will and/or Trust, it is helpful to understand what happens to ones property when one dies on this earth.

In the State of Michigan when one dies, the state (through its laws) will have decided who should receive your money or assets and how much or what percentage each person or class of persons should receive. In Michigan there are laws called Laws of Intestate Possession. Intestate means in=without testate=[Latin testan] to leave a document that tells others who, how and when another should have your property at death, usually in a Will.

Who Gets What in Michigan (When One Dies Without a Will or Other Document Telling Others

 

How to Distribute Their "Stuff')?

 

Who gets what depends on whether or not you have living children, parents, or other close relatives when you die. Here's a quick overview:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Many valuable assets don't go through your Will, and aren't affected by intestate succession laws. Here are some examples of things you can hold jointly or in trust or payable upon death:

* property you've transferred to a living trust

* funds in an IRA, 401 (k), or other retirement account. x payable-on-death bank accounts, or

* life insurance proceeds

* securities held in transfer-on-death account x property you own with someone else in joint tenancy or tenancy by the entirety

 

These things listed above go to the surviving co-owner or to the beneficiary you named, whether or not you have a Will. There will be no need to go to a court to determine who is the owner or person who will receive the property. You avoid all court fees and all attorney fees, which can be $250 to $300 an hour or a flat fee based upon the value of the estate, usually a small percentage.

Possible problems: You both left everything to your spouse and mentioned that if they died first, your children would receive. At that time your children were young, obedient church going folk. What if it is fifteen (15) years later: your spouse is no longer living or you two die in the same plane crash or car crash? The children, now in their late 20s to mid thirties, inherit everything and share equally? One of the children is in a very bad marriage; a second has wandered from the faith and is living like the prodigal son (or daughter); a third is deeply in debt and a fourth had a learning problem, but stayed home and helped you out greatly, especially when mom had those medical problems. Would you really want the spouse of your child in a bad marriage to take one fourth of the money? Would you want the second to be enabled to purchase drugs, alcohol and what goes along with them? Would you want the creditors of the third one to get a fourth? How about that good child who had trouble learning? Should that one be forced to move out and take one fourth for more than ten years of labor at your home? AND did you know that the fifth child born out of wedlock when Dad was a young man, who has not been seen in twenty (20) years, can come in and make it so that everyone now gets only 1/5 and that fifth child will share equally, even though his mother remarried and he/she is now financially well off?  

 And then there was a man that I represented years ago who had been secretly married to a wealthy widow, but he was kept secret from the family (I am not certain who was ashamed of whom). He came in for a full share as the surviving spouse. Yet, John was fair to the family and did not take all to which the laws of Michigan entitled him. BUT he could have taken almost everything under the law. This leads me to explain the share of the surviving spouse.

 

The Spouse's Share in Michigan

In Michigan, if you are married and you die without a Will, what your spouse receives depends on who is alive then. Do you have living parents, living children (born at any time to any person, your spouse or another) or legally adopted children, or grandchildren, or great-grandchildren? If you don't have any of these, your spouse inherits all of your property that is not covered by a Will or otherwise excluded. If you do have others living, they and your spouse will share your property as follows:

1 - Parents living, no children living.

 Spouse inherits the first $150,000 plus 3/4 of the balance.  Parents receive the other 1/4.

Mary is married to Joe, and her father is still alive. Mary owns a house in joint tenancy with Joe, and Joe is also the named beneficiary of Mary's retirement account. When Mary dies, Joe automatically inherits the house and any remaining retirement funds; those things are not intestate property (intestate means that it passes upon death). But, suppose Mary has significant additional property $300,000. 00 that should have passed under a Will. Joe inherits $150,000 worth of that property plus 3/4 of everything else. MATH: $300,000.00-$150.000.00 (spouse's share) $150.000.00 balance. Joe receives 3/4 of the remaining $150,000.= $112,500.00. The remaining 1/4 of the intestate property ($37,500.00) goes to Mary's father (and his new girlfriend who is only 25) or more realistically to the beloved nursing home or if he is on Medicaid to the beloved State of Michigan.

2.- Children or other descendants from you and the surviving spouse.

Spouse inherits the first $150,000 of your assets, plus% of balance. Other% to descendants.

3.- One descendant from you and surviving spouse, and one or more descendants from another.

Spouse inherits first $150,000 of assets, plus % of balance. Other% shared by children

If there is $480,000 of other property that would have passed under a Will; spouse inherits $150,000. worth of property, plus% of the balance --that is, $165,000--for a total of $315,000. The two children split the remaining $165,000 share of the property. Is that what you want?

4.- One descendant from a previous relationship. No descendants from surviving spouse.

Spouse inherits the first $100,000 of your property, plus% of balance. Child gets the balance.

A client of mine, for whom I had gotten Social Security Disability, married a 19 year old girl after his 45 year old wife died of cancer. The 19 year old became the mother of his young barely pre teen children. (She was much closer in age to them, than to her husband. The former client had promised the 19 year old that he had, had me make out a document leaving her everything. Yet, her call to me (after the funeral of my former client) was the first that I learned about his tale to her. She had given him ten (10) years of her life and helped raise his two children through high school, and taken care of him, in his period of disability and as a wife, believing, she would inherit it all, including his house and property. She received very little. All she would have gotten if the property value and other assets had reached $250.000. was 100,000. + % of the balance or a total $225,000.00. The children would split the other $75,000.00. She had to sell the home to give the children their share.

CHILDREN: This leads me to explain to you what the term child means to the State of Michigan. The State of Michigan may not see children the way that you may see children. For a child to be a child, that child must be a legal child of yours. Yet legal does not exclude a child born from a relationship that happened long ago, without benefit of marriage.

Thus, Children born outside of marriage, to a woman to whom you were not married will receive a share of your estate if you said to an official, you were the parent (acknowledged paternity) or if your paternity is some way established under Michigan law. (DNA test.)

Adopted children are who are legally adopted receive a share. But, not someone you raised from infancy to now, without benefit of a legal adoption. That latter one is not a State of Michigan 'legal child.' They may have been your pride and joy and you may have been the only parent that they knew, but that is not how the State of Michigan sees it. You need a Will or a Trust or an adoption to protect such a child. This, of course, leads us to Foster Children.

Foster children who may have been with you from grade school to graduation ARE NOT legal children, unless legally adopted. To include them you need a Will.

 

Stepchildren you never legally adopted DO NOT automatically receive a share. Under some circumstances they may, but if you want them to receive a portion of your property at your death, to protect and assure them of a share of your assets, you need a Will or a Trust.

Children placed for adoption or allowed to be adopted by a second family, who were legally adopted by another family will not receive a share. Suppose you allowed the adoption and the second spouse died or divorced your former spouse or was mean to your child after they had biological children of their own. That child, who is no longer legally yours, may become very close to you, and protest as that child may, at your death, unless you leave a Will or a Trust, that child will not be protected and will not receive a share of your property.

Posthumous children. Children conceived by you but not born before your death will receive a share as long as they survive at least 120 hours after birth.

DANGER: Children born during your legal marriage to the woman you married long ago ARE your legal children. Any child born to your wife during your marriage is assumed to be your child and will receive a share of your estate. I once was in court and a man was being charged for non support of eight children born to his wife, after they had separated about ten years before. Had he died then, those children would all have shared in his property and assets. And the judge in this matter did not sound as if he was going to grant the man a paternity test to exclude him as father. But a Will or Trust would have excluded them from receiving a share of his property upon death, so long as the children were no longer being taken care of by State assistance.

Grandchildren will NOT receive a share. Grandchildren receive a share only if their parent (your child) has died before you die. If you have a favorite grandchild (ren) and you want them to have money for college, you need a Will or a Trust.

We had a client whose child had two children, who were her grandchildren. One was adopted, one was a direct blood descendant. The grandmother (for her own reasons) made a Will favoring the blood line child and excluding the adopted child. Without a Will neither grandchild would have received while the parents (grandmother's child) was alive. HOWEVER, both would have received equally had the parent died before the grandparent died. The adopted child is excluded by the Will.

HOW MAY I AVOID PROBATE AND NOT PAY FOR A WILL OR A TRUST?

To avoid Probate Court, one would have to hold all of his property in joint names with another person: the house, the car, the bank accounts, pension plans. 401, IRA. any mobile home or boat or off road vehicle. And that second person would have to be alive when the first person dies. So, if one only has a few major assets such as a house and a mobile home and a vehicle, then dual or joint title method can accomplish avoiding the delay and costs of Probate. There will be no need to go through Probate. However, you have to have ultimate trust in your joint tenant or they might cause you problems in the future, especially if you become disabled or have to go into assisted living. We have seen horror stories of joint tenants, with children taking advantage of that situation to get the property or sell it and split it one half with the assisted living place, one half to themselves (and/or by purchasing a new car for the parent, which the parent will never drive and taking other legal steps).

 

CONCLUSION:

So who is to decide who receives your property (stuff) when you die, and when and how, they receive it, you or the wise and all knowing State of Michigan?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Should I Have a Will or Trust or Nothing?