Oregon Estate + Business Planning Blog

FAQ: What will happen to our house if we are married, but I am not on title?

A very common scenario that married people face is when they own a house, but one spouse is not on title. What will happen with the property when the owner-spouse dies? The answer to this question assumes that there is not an estate plan in place yet.

Generally, in Oregon, without an estate plan in place, the surviving spouse inherits all of the deceased spouse's property, but not necessarily without the probate court's approval. This is not always the case, but is the general rule. (If you have a blended family, things are different.)

However, the house and any other assets owned solely by the deceased spouse would have to go through the probate process in order for the surviving spouse to become the owner. Probate is a court process that happens after a person dies. The personal representative (called "executor" in other states), with the supervision of the court, takes inventory of assets, valuates the estate, pays off creditors, and distributes what is left to whomever the heirs are. If that sounds complicated, it's because it is. The probate process can cost a lot of money and take a lot of time, and probate is all a matter of public record. The way this usually plays out is that the surviving spouse continues to pay the mortgage for several years and doesn't find out that the house needs to be probated until he or she tries to sell it. At that point, they discover that the house can't be sold until it goes through probate, so a sale is held up for several months and in some cases, years.

How Do I Fix This!?

Well, you can always just create a new deed that names both spouses. The mortgage can stay in one spouse's name. That's the easiest way to do it. When a spouse dies, the surviving spouse simply records the death certificate with the county and becomes the sole owner. But many people don't want to do that because they wish to keep their separate property separate. The only other easy way to avoid probate in this scenario would be through trust planning. Plus, the joint property scenario won't help your kids to avoid probate if both spouses die. A will is not enough. A will basically tells a probate judge what to do with your property. A trust tells the trustee what to do with the property, and the trustee can handle transferring the assets without ever opening a probate. You can even make your surviving spouse the trustee. 

But guess what. You should consult with an attorney before making any of these decisions. I just want to make you aware that these issues exist, and that there are various ways to solve them. Oh, and by the way, this scenario creates other problems if you and your spouse are not legally married. Consult with a lawyer.

To your family's health & prosperity,

 

P.S.  Want to get started on the most important planning you'll ever do for your family?  Give our office a call at (503) 235-5150 to get started.  You'll be glad you did.

___

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Candice N. Aiston is an Estate Planning Attorney for families in the Portland, Oregon area. She helps loving parents to prepare their families for a lifetime of security, prosperity, and guidance. If you would like to receive her free report, "The 9 Common Planning Mistakes Parents Make," please visit http://candiceaistonlaw.com/.

*Image courtesy of fantasista at FreeDigitalPhotos.net

Love Stories for Valentine's Day

In my adult life, I have learned a lot about love, and I guess the biggest thing I've learned is that love is not a feeling; love is the things that we do.  Do you remember what you thought about love when you were younger?  I remember thinking that love must be thrilling, exhilarating, and blissful.  My ideas about love probably started with some Disney movie, and then continued with 90210 and whatever other TV shows and movies I was into as a teenager.  Although I heard from many grown-ups in my life that "love is an action," I really didn't grasp that until I was older.

You know what else I've learned about love?  I've learned that martyring myself doesn't prove my love for someone.  I've learned that taking great care of myself is a way of loving my family.  I've learned that sometimes, when it comes to my kids, I don't have to say yes to every single thing.  They might not understand my love now, but they will when they are older.  I didn't always understand that my parents loved me, and I'm sure there were several years when they didn't feel very warm and fuzzy about me, but their acts of love continued - making sure I was fed, clothed, educated, and given opportunities - and I can see that today. 

The truth is, most of us are suckers for love stories, but not the unsexy stories that focus on real acts of love.  We like romance.  And when it comes to our kids, we enjoy those special warm and fuzzy moments like Christmas or birthdays, but we don't feel warm and fuzzy about the loving acts that we do every day.  Changing a diaper is a loving act, trust me.  (Consider the alternative.)  Going to work every day is a loving act.  Making sacrifices to raise your kids according to your beliefs is a loving act.  Sometimes, sacrificing the feel-good moments for the greater good is a loving act (like when you have to say no to something your kid wants to buy, because you are spending that money on something more important, like contributing to your retirement account).

And here are some love stories that I see in my line of work every day:

~The spouses who execute healthcare directives, so that one spouse is not left agonizing over important medical decisions.

~The spouses who organize their assets so that a surviving spouse doesn't have to go to court to gain access to them.

~The working spouse who buys a life insurance policy so that a stay-at-home spouse is not left penniless and hopeless if something happens.

~The parents who start planning for retirement and end-of-life care early, so that their kids are not overly burdened with their care later in life.

~The parents who execute a KidsCare Plan, so that their kids are always with the right people, no matter what happens.

~The parents who ensure that their family always has quick access to financial resources and are never left paying thousands of dollars to get access to the money they need.

~The parents who make sure that the kids' inheritance is safeguarded until they are through college so that they have every opportunity in life.

~The parent  who makes sure that their child always has an inheritance, even if the surviving spouse remarries.

~The parents who record a special message to their kids, so that their kids always have guidance, even if the parents are no longer there.

And there are so many more.  Estate Planning is the ultimate act of love - ensuring that your family is cared for even if you're not here.  It probably won't give you that warm fuzzy feeling that you get when you see your kid on her first ride at Disneyland, and you won't get any I-love-you's from your kids for doing it, but you'll know that your loved ones will always be taken care of, no matter what happens in life. 

That's what love is all about.

To your family's health & prosperity,

 

P.S.  Want to get started on the most important planning you'll ever do for your family?  Give our office a call at (503) 235-5150 to get started.  You'll be glad you did.

___

Want to use this article in your newsletter or on your blog or website?

 

You can!  Just please be sure to use this complete blurb with it:

 

Candice N. Aiston is an Estate Planning Attorney for families in the Portland, Oregon area.  She helps loving parents to prepare their families for a lifetime of security, prosperity, and guidance.  If you would like to receive her free report, "The 9 Common Planning Mistakes Parents Make," please visit http://candiceaistonlaw.com/.

Moms: Will you end up like her?

I recently heard the story of a Mom whose husband died. I know it happens all the time, but this story was particularly sad, because the woman ended up having to walk away from their house and allow it to be foreclosed on, because she couldn't afford to keep up with the mortgage payments and it would have cost too much to fix up and sell, if it would even sell in this market.

This is what estate planning is all about - it's about taking care of the people you love, even after you're gone.

I can't imagine having to grieve my husband's death, take care of my grieving children, and have to let go of our family home all at the same time. And the poor kids - they must be so devastated. I know the home is just a material possession, but if they love their home as much as my family loves our home, I know they're probably really hurting.

The sad thing is that it would have been so easy to take care of this with estate planning! A life insurance policy of just a few hundred thousand dollars could have bought this poor woman a couple of years until the market improved and she had healed enough to better her income situation.

One of the problems was that because of the way certain assets were titled, the husband's estate had to go through probate. So, a lot of assets were tied up and couldn't be used to help with paying bills. This could have been easily avoided with the proper planning. Probate is totally optional, and it pains me to see anyone not doing the planning they need to do to avoid it.

So Moms, what about you? Could this happen to you?

To your family's health & prosperity,

 

Candice

P.S. My May offer is almost over! You have to call today to get your free Family Wealth Planning Session (normally $750) and your $50 Hopworks gift certificate when you set an appointment and engage with our firm! (503) 235-5150.

Do you have an unhealthy relationship with money? Part 2: Money and your marriage

In the last post, we talked about your personal relationship with money.  In this post, I want to talk about how unhealthy relationships with money can affect your marriage. 

Coincidentally, on the same day as my last post, KATU's AM Northwest featured Spencer Sherman, author of The Cure for Money Madness.  He discussed a lot of the things I discussed in the last post, but brought out some new points on commonly held beliefs that I hadn't thought of, such as, "I am my net worth," "I am nothing if I don't own property," and "Renting is throwing money down the drain."  Those are extremely common aren't they?  But they are wrong!

And how could those beliefs NOT affect a marital relationship?  If I am my net worth and my net worth is zero, what do I feel like I have to give to my family?  If I am nothing without owning property and I don't own my home, what kind of stigma do I feel that I'm placing on my family?  And how can I have any hope for being able to make myself worth something if I am throwing money down the drain on rent?

And there are more problems.  People don't like to talk about money!  Even with their spouses!  And look at these statistics: 50% of marriages end in divorce.  90% of divorces are rooted in financial issues or disagreements.  Could we reduce our chances of divorce if we sat down and hashed out all of the money issues, set a budget, and set goals for savings and spending?

I recommend:

1. Getting clear on what your limiting money beliefs are.  Read Part 1 of this series and take some time to think about what your limiting beliefs are surrounding money.  Think of things your parents said a lot about money.  Try to take a serious look at whether you are carrying any limiting beliefs with you that are affecting your life and feelings of self-worth in any way.  (Side note: It should be emphasized that our parents probably did the best they could and that the goal of this is not to blame or be resentful.  It's simply to break a cycle for the sake of our happiness and that of our kids.)

2. Finding out what your spouse's limiting money beliefs are.  Discuss this with your spouse.  Share with your spouse what you have discovered about yourself.  It may help your spouse to let the walls down if you share first.  Try to reflect on which beliefs you hold differently and which are the same. 

3. Setting a low-stress time to hash out money issues.  Trying to hash out money issues when you just got a large utility bill or when you just overdrew on an account is a bad idea!  Pick a neutral time and place (like a coffee shop), get someone to watch the kids if you can, and make a commitment to stay and hash it out until it's all hashed out!  What are the recurring issues?  What are the recurring worries?  What are arguments usually about?  What do you need from one another?

4. Running the numbers.  (Gulp!)  Look over your bank and credit card statements and see what your spending habits are.  It's helpful to use a high-lighter to differentiate between categories of spending.  Bills that are necessities can be one color, food another, unplanned spending another, and so on.  Add them all up for each month.  Are the numbers acceptable to you?  Can you think of ways to cut back if they are not acceptable?  This can mean leaving the credit card at home when you go "window shopping" just to get the kids out of the house or planning meals a week at a time to avoid multiple trips to the grocery store per week (and all the impulse shopping that goes along with that).

5. Setting a budget.  How much are you (as a couple) bringing in each month?  How much goes to savings, like retirement, college, and other savings?  What is left over?  How does it match up with the numbers you ran for spending?  It is time to set up a budget.  What is left over should be split between spouses according to need.  For example, if one spouse primarily takes care of the kids, it's not fair to leave that spouse with half the money and all the responsibility of paying for the kids' daily purchases, while the other spouse gets to spend money only on self-needs.

6. Setting savings goals.  These are going to look different for every couple, but common savings goals are for vacations, down payments on property, or a new car.  Setting a goal together and reaching it can put the sparkle back in your eye for one another.  Each spouse should contribute out of their portion of spending money for each month.  I can't emphasize enough how rewarding it is to reach your goal and be able to celebrate with your spouse.  Working together as a unit is deeply satisfying.

7. Checking in monthly.  Accountability is the key to success!  Schedule a monthly meeting with one another to check in, discuss progress, and change course if necessary.  You may have set goals that are too lofty, and that's OK!  All you have to do is recognize it and make changes.

Just remember, communication is really important, especially on subjects that we don't want to talk about, like money!

To your family's health & prosperity,

Candice