A Plan Today For Your Future

Barely four months after their wedding, on a cold December night in 2004, she received that dreadful call--the call that changed her life forever. Oh! She hoped it was a dream and prayed to awake from the horrible nightmare. Unfortunately, the accident that snuffed out his young life was a ghastly head-on collision that spared no second on the accident scene. "If I could do it over again," she said "estate planning would be top on my list," she muttered as tears trickled down her face. 

According to a 2010 lawyer.com poll, about "65 percent of American Adults" die without a will. I find this fact mind boggling and appalling, especially in an elite and information-driven society like the United States. If stated in layman’s terms, it simply means more than half of Americans die without a plan. Michael Baisden, a popular radio personality once said “those who fail to plan, plan to fail.” This is a simple truth. If you die without a plan, your assumptions will fail you. In North Carolina, dying without a will empowers the state to dictate how your property will be distributed. Failure to execute a will, also creates an opportunity for the state to benefit from your estate under certain circumstances. Hence, the power of estate planning can never be underestimated.

That being said, while estate planning is not an exciting topic, it definitely deserves serious and meticulous consideration. Most people shy away from conversations dealing with death or incapacity, but while we fervently pray for long life and health, the truth remains—life is “uncertain” and the end of every life remains a mystery waiting to be unraveled.

Regardless of whether you have substantial assets or not, estate planning is right for you. The purpose of an estate plan is to give you peace of mind and closure in the event of unforeseen or sudden mishap.  A famous quote by Benjamin Franklin states “nothing is certain, except death and taxes.” Although this may sound absurd, it remains true to an extent —Death is the only guaranteed outcome of any human life, and so long as you live in the United States, you must pay taxes, even in your death. 

Hence, the only thing standing between a long lasting family feud and peace of mind is a well planned estate. Alan Lakein, a well-know author once said “planning is bringing the future into the present so that you can do something about it now.” That sums up the importance of wills and estate planning; it gives you the authority to dictate how your property should be distributed in the event of death or incapacity.

Pursuant to North Carolina laws, when a person dies without a will, the decedent’s estate, which is the dead person’s property, will be distributed in accordance with the Intestate Succession Act (ISA). This can be problematic, because this process may distribute contrary to the decedent’s true intentions. As such, estate planning remains the best option. N.C. Gen. Stat. § 116B-2 states: “whenever the owner of any real or personal property situated or located within this State dies intestate[without a will]... without leaving surviving any heirs…to inherit said property…such real and personal property shall escheat” to the state. So ask yourself, is it better to have the state inherit your property or would you rather exercise your authority while still alive?

For those of you with a valid executed will, when was the last time you reviewed your will? It is safe to say so long as there is life, situations can change; thus, having a one-time validly executed will may not suffice. For example, the beneficiary or devisee of a will could die before the testator (person executing the will). If the will is not amended via codicil, this could trigger complicated “anti-lapse” issues, which will ultimately determine whether blood relatives of the predeceased beneficiary take under the will or whether the gift will fail. If the gift fails, the next question becomes, who gets the failed gift? Your guess is as good as mine. Also consider where a will is validly executed subsequent to a marriage, but prior to a divorce, this too can trigger an undesirable outcome, since North Carolina is a strict compliance state and will strictly abide by the wishes of the testator as indicated in the will. These are few examples of what could happen if your will is not reviewed or updated.  

In order to have a valid will in North Carolina, the testator must be 18 years or older, have testamentary intent and the will must be signed in the presence of “at least two competent” and disinterested witnesses.

Are you concerned about the cost of hiring a lawyer to draft your will? Concern yourself no more. North Carolina recognizes three types of wills and you do not need a lawyer to draft your will; however, it is highly recommended that you consult with a lawyer to avoid any future legal problems.

First, North Carolina recognizes something called a “holographic will.” It is a will “written entirely” in the testator’s handwriting. It must be signed by the testator and kept in a safe place i.e. a safe deposit box. The issue of what comprises a safe place has been the subject of recent litigation and you must take affirmative steps to ensure your holographic will complies with N.C. Gen. Stat. § 31-3.4.

Second, this State recognizes oral wills called “nuncupative wills.” In order to have a valid nuncupative will, it must be spoken in the testator’s last illness or “imminent peril of death.” It must be made in the presence of “two competent” and disinterested witnesses.  Also, a nuncupative will must be probated within six (6) months or the witnesses may reduce the oral will to writing within ten (10) days. Please refer to N.C. Gen. Stat. § 31-3.5 for more information.

Third, North Carolina will recognize a valid attested written will pursuant to N.C. Gen. Stat. § 31-3.3. An attested will must be written and signed in the presence of “at least two competent” and disinterested witnesses. I emphasize the word “disinterested,” because pursuant to North Carolina laws, the interest of a beneficiary who also serves as a witness in the same instrument will be “purged” or voided out. Hence, a person who simultaneously serves as a witness and beneficiary, forfeits his or her interest in the legal document.

In addition to having a valid executed will, you may also want to consider advance directives. An advance directive instructs health care providers and financial institutions of your wishes in the event of your incapacity. Advance directives include: living wills, health care power of attorney, durable power of attorney etc.

Finally, while we continue to hope for the best in life, we must embrace the reality of life’s uncertainty, and deal with the future today.

For more information, please visit our website at: www.thecrescentlaw.com or call (919) 341-9707. You may also visit our Raleigh office at: 4924 Windy Hill Drive, Suite A, Raleigh, NC 27609.

This post is not intended to give legal advice and does not in any way create an attorney client privilege. Contact a lawyer if you have specific questions regarding your estate plans.