Valentine's Day brings romance, roses, chocolates and champagne.
For an estate planning lawyer, Valentine's Day means reviewing clients that have "I Love You” Wills. It is used by many married couples where each spouse leaves all their assets to the survivor. Upon the surviving spouse passing, then their remaining assets are left to their children. While this type of estate planning is simple, for an estate planning lawyer, it can be a disaster.
Many of the "I Love You" Wills that we come across are a result of poor planning and poor advice failing to take into account other important considerations:
They provide little or no asset protection
Once your assets are owned by your beneficiary, they become subject to their creditors. If your surviving spouse is carrying on a business or are in a high risk occupation, those assets will be exposed and at risk.
There is no guarantee assets will go to your children
In an “I Love You” Will, your assets belong to your surviving spouse to do what he or she pleases . The surviving spouse can change their Will to the detriment of your children. For example, if your spouse remarries, he or she can change their Will and leave your assets to the new spouse or partner. Even worse, the surviving spouse could separate or divorce and the assets will be tied up in divorce or separation proceedings.
No tax planning
An “I Love You” Will means the surviving spouse owns all the assets that could result in higher taxes. Your children and grandchildren could also miss out on significant tax concessions.
If you have an “I Love You” Will, contact PV Legal so that we can give you the options to protect your assets and beneficiaries.
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