Estate Planning For Single Parents: How To Ensure Your Children Inherit Your Family Home
A family home is a valued asset. Therefore, as a single parent, you probably want your children to inherit the property. Unfortunately, if you don't make any plans, conflict may arise between your children and other interested parties. As a result, your kids may be dragged through long and emotionally exhausting probate processes. Proper estate planning ensures that your family home goes to the intended beneficiaries in your absence. Below are three viable options to consider if you want your kids to inherit your family home.
Make a Legal Will
Writing a will is one of the best ways to ensure your assets and possessions will be distributed to your preferred beneficiaries upon your death. If you don't already have a will, make one and list your children as the beneficiaries of your family home. Ensure the document is valid by asking an estate planning attorney to help you write and execute it.
A will has to go through probate for the judge to validate it. If property disputes arise, the probate process will be lengthy. Also, if there are multiple beneficiaries for the family home, each will inherit an undivided interest. Thus, if the beneficiaries don't get along, for example, estranged siblings, they may fail to agree on the disposition of the property.
Set Up a Revocable Living Trust
A will can open up your estate to probate and lead to bitter wars between estranged siblings and other interested parties. One great alternative to a will is a revocable living trust. A living trust is a document you create during your lifetime. You can transfer the family home and other assets to the living trust and name yourself the trustee. This allows you to control, revoke, and alter the trust during your lifetime.
Once you pass away, the home passes down to your kids, and a successor trustee takes charge of the trust. A living trust doesn't go through probate for validation. Therefore, this option eliminates the disputes and lengthy processes associated with probate. If disputes arise among your kids, the successor trustee, who is the decision-maker of the trust, resolves them.
Opt for a Transfer-On-Death Deed
A transfer-on-death (TOD) deed lets you name a beneficiary of your assets when you die. It is like a regular deed, only that it doesn't take effect until you die. This option avoids probate court and all the complexities associated with it. All your children need to do is lodge an application to the registrar's office and provide the requisite documentation. The only downside to this option is that some states don't allow TOD deeds.
Consider the above options if you want your kids to inherit your family home. Consult an estate planning attorney for legal advice and estate planning services.