Clarifying the Difference Between Estate Planning and Estate Litigation
Don’t leave your family’s future up to chance.
Estate planning and estate litigation are two very different processes. One ensures your family is taken care of no matter what the future brings. The other is what your family deals with if your estate plan is lacking.
The issue:
Most people get these two things mixed up. They think having a last will and testament is enough. But the truth is far from it.
In fact, 35% of American adults have experienced family conflict due to failed estate planning.
That means 1 out of every 3 families you know is dealing with a completely avoidable problem.
Let’s take a closer look at estate planning vs. estate litigation.
You’ll learn:
- Exactly what estate planning is
- What estate litigation involves
- 4 Differences between estate planning and litigation
- When to hire a probate litigation lawyer
Exactly What Estate Planning Is
Estate planning is the process of preparing for the inevitable.
More specifically, it’s how you decide what happens to all of your assets when you die. Creating a detailed estate plan ensures your family is taken care of according to your wishes.
When done correctly with a Scottsdale Estate Litigation Lawyer, estate planning can eliminate the need for probate litigation down the road.
Estate Planning Includes:
- Writing a last will and testament
- Creating trusts
- Drafting powers of attorney
- Writing your healthcare directives
- Beneficiary designation
Simple enough, right?
The goal of estate planning is to make these decisions for your loved ones before they’re forced to make them suddenly.
If you don’t have estate planning documents in place when you pass away, then state laws decide who inherits your hard-earned assets.
And here’s a hard truth…
Only 32% of Americans have an estate plan.
That means 7 out of 10 families are not prepared for what’s ahead.
What Estate Litigation Involves
Now onto estate litigation.
Estate litigation occurs when there is a disagreement among family members after death.
Perhaps someone contests the deceased person’s will. Or maybe they feel like someone was taking advantage of their loved one before they passed away.
Either way. Estate litigation refers to the lawsuits that happen during probate.
Examples of estate litigation include:
- Will Contests
- Undue Influence
- Probate Fraud
- Unequal Distribution of Assets
- Mismanagement of Assets by Executor
During estate litigation, a judge will hear arguments from all sides involved. The court will then make a final decision on how assets will be distributed.
But here’s what most people don’t know…
Estate litigation costs can eat up to 10% of the estate’s value. Plus, the process typically takes 18-24 months to complete.
The average probate process takes 20 months to finish according to one study. Many contested estate cases can take years.
4 Differences Between Estate Planning & Litigation
You now know the basics of what estate planning is and what estate litigation involves. But how are these two subjects different from each other?
Here are four ways estate planning and estate litigation don’t match up.
- Estate planning occurs before someone dies. Estate litigation occurs after.
- Estate planning is private. Estate litigation enters the matters into the public record.
- With estate planning, you have control over the outcome. A judge has control during estate litigation.
- Planning is cheap. Litigation is expensive.
Think about your property and a fence around it.
Building a quality fence keeps people from sneaking onto your property. Estate planning is like that fence.
If someone does sneak onto your land and steal something, you call the police. Estate litigation is the police coming to your house.
One is for prevention. The other is for after the fact.
Here’s how the costs compare:
While estate planning can run you a few thousand dollars. Estate litigation can cost tens if not hundreds of thousands of dollars.
When To Hire a Probate Litigation Lawyer
So you might be thinking…
“I don’t want my family to deal with estate litigation. What can I do to prevent it?”
You hire a lawyer to create a rock-solid estate plan.
But let’s say someone still challenges your will or maybe your children can’t agree on how assets should be distributed.
When that happens, you need a probate litigation lawyer to represent you and your family’s interests in court.
You may need a probate litigation lawyer if:
- Someone challenges a will.
- An executor is not performing their duties.
- Assets are being hidden.
- Someone is behaving unfairly towards beneficiaries.
- There is suspicion of elder abuse
Knowing when to seek legal help can be tricky. Don’t waste time guessing. When in doubt, consult with a lawyer.
But don’t forget this…
The best way to avoid probate litigation is to have a properly prepared estate plan. Having an attorney write your estate planning documents can help eliminate mistakes that lead to litigation.
How To Protect Your Family
Let’s say you take every precaution when drafting your estate planning documents. You hire an experienced attorney to write your estate plan. You make sure all of your ducks are in a row.
What else can you do?
You could have your family members sit down and discuss your wishes with them. Many will contests are started because someone in the family was unaware of the decedent’s intentions.
Here are some other things you can do:
- Hire estate planning professionals. Estate planning is not a one size fits all type of deal. You wouldn’t hire just any doctor when you’re sick. You want someone who specializes in the area your issue stems from. Take your estate planning the same way.
- Provide explanations for large gifts. If you leave Sonny with considerably more money than his siblings, he has a reason. Make sure you put in writing why you decided to do that. Providing justification for large gifts can prevent litigation down the road.
- Update your beneficiary designations. Beneficiary designations on retirement accounts override what your will says. Make sure they’re up to date and change them if life circumstances change.
Anything you can do to prevent your family from going to court is worth doing.
Don’t wait until it’s too late. Speak to an attorney about your estate planning options today.
Talk to your loved ones about your wishes while you’re still able to. The more family members know, the less room there is for confusion after you pass away.
Wrapping Up
Estate planning and estate litigation are very different procedures with one thing in common.
They both deal with what happens to your assets after you die.
But where should planning proactively helps you avoid family disputes. Litigation happens after the fact and pours money down the drain.
Here’s my question for you:
Which sounds more effective at protecting your family?
An ounce of prevention or a pound of litigation?
Please spend the time necessary to plan your estate correctly the first time. Your family will thank you later.