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Charleston Estate Planning & Asset Protection Blog

Monday, July 30, 2018

8 Common Asset Protection Myths That May Be Hurting Your Family

Too often, we see families come to us after a loved one has passed, asking us what they can do to protect the assets left behind without a will or trust telling them who gets what. Failing to have an estate plan in place can leave your loved ones feeling lost and confused – often thinking that the government is going to take everything away from them. This is a common estate planning myth that gets passed around, among many.

Our asset protection lawyers have collected some of the most common estate planning myths here so that you can better understand what will or will not happen if you fail to plan for your estate.

Myth #1 – My family will get nothing if I don’t have a will.

The truth is, even if you don’t have a will, the government has an estate plan for you in the form of intestate laws. In South Carolina, the government will distribute the assets of a person who dies without an estate plan according to its predetermined laws. For example, if you die without children, your spouse will inherit all of your assets. On the other hand, if you die with children (called “decedents”), then your surviving spouse would receive ½ of your estate and your children would inherit the rest in equal parts.

Myth #2 – If I have a will, my estate will not have to go through probate.

The truth is, in order to avoid probate, you must have a properly created, executed and funded living trust in place.

Myth #3 – If I have a living trust, my estate will not have to go through probate.

This is only true if all of your assets have been properly transferred to the living trust.

Myth #4 – All I need is a living trust and my estate plan is complete.

Not necessarily. Effective estate planning addresses a number of issues to secure your family’s financial future. This includes measures to avoid estate taxes and income taxes to conserve assets, as well as measures to grow and distribute your assets after your death.

Myth #5 – I should hold all of my assets in joint tenancy with my children.

The truth is, while this may avoid estate taxes, there are a number of drawbacks to this plan. Talking things over with an experienced asset protection lawyer is a wise move before making this type of decision.

Myth #6 – A living trust will prevent estate taxes when I die.

The truth is, living trusts can help avoid some taxes, but will not eliminate or reduce those taxes without concurrent strategic tax planning.

Myth #7 – Life insurance payouts are tax-free.

Not necessarily. If the life insurance is held in an irrevocable life insurance trust or by your children, then yes, the payouts are tax free. Additionally, any life insurance proceeds paid out to your spouse will be subject to a death tax when he or she dies.

Myth #8 – I don’t need an attorney for estate planning.

This is only true if you do not care about how your assets are handled when you die. If you want to be certain that your designated family members will receive the maximum amount of your assets, then seeking the help of an asset protection attorney is your best bet. Schedule a consult with one of our South Carolina asset protection lawyers today to help you to determine the best tactics to protect your interests, your assets, and your family.

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Wiles Law Firm, LLC helps clients with their estate planning needs in Charleston, South Carolina and the surrounding areas such as West Ashley, Summerville, North Charleston, Mount Pleasant, and John's Island.

Information on this website is not legal advice. Further, viewing of the enclosed information does not create an attorney-client relationship with Wiles Law Firm, LLC. Matters will be handled by attorneys who primarily practice out of our office in Charleston County located at 852 Lowcountry Blvd., Ste. 101, Mt. Pleasant, SC 29464. M. Emerson Wiles, III is the attorney responsible for this advertisement.

Any result Wiles Law Firm, LLC may achieve on behalf of one client in one particular matter does not necessarily indicate similar results can be obtained for other clients. Please contact a South Carolina estate planning attorney or one of our attorneys with Wiles Law Firm, LLC for a consultation regarding your unique estate plan.

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