When a Nevada person decides to begin estate planning, one of the main reasons is to control where assets will go at the time of death. This allows a person to express their wishes as to who will get use of their money after they die. Wills are estate planning documents that can instruct a designated executor in the distribution of an estate. At the time of a person’s death, the will is often probated and after debts are satisfied, assets can be remitted to beneficiaries under the direction of the court. These beneficiaries can be children, pets, organizations or any person specified by the decedent.
Nevada residents engaging in estate planning may be interested to learn about a new study that shows that heirs spend nearly half of what they inherit in many cases. The study, conducted by Ohio State University for the US Bureau of Labor Statistics, shows that after they spend half, heirs often save, donate or give away the rest of an inheritance. This long-term study was conducted over many years.
Those who are currently involved in estate planning who wish to limit the ability of an heir to spend large amounts of their inheritance might wish to consider a trust. A trust is an estate planning tool that often allows the trustee to distribute an estate under specific guidelines. Some types of trusts can even limit beneficiaries to only receiving money for their care and maintenance.
Like all estate planning tools, both wills and trusts have benefits and potential disadvantages. There may be tax consequences and other considerations as planning moves forward. A person planning an estate would be well advised to review all of their assets and consider which beneficiaries they wish to leave their money to at the time of their death, while focusing on what will remain to be distributed after debts have been settled.
Source: Examiner, “OSU study finds most Americans save about half of inheritances,” John Michael Spinelli, March 15, 2012