A very common question is whether you should update your estate planning when you move to a new state. If you’ve recently moved you probably have lots to do, but be sure to add updating estate planning to your list!
When moving to a new state, you’ll have a long list of things to handle. Everyone thinks about handling things like utilities, forwarding mail, driver’s license, car tags, finding a new doctor, etc. Yet many people overlook one of the most important things we should update: our Wills.
Any time you choose to move out of state, you need to take a fresh look at your estate plan. Not only is it a good time to update your assets (many of us either sell or purchase new things when we move), but it’s also crucial to ensure that your Will is valid in your new state.
Here are key considerations about why moving to a new state means it’s critical to review your estate plans and perhaps even completely rewrite your Will. Estate planning laws vary from state to state, so it’s crucial to understand the rules in your new state. Getting the right help and planning accordingly can better protect you and your loved ones, and to avoid unnecessary heartaches and headaches in the future.
Are Wills Valid in More Than One State?
Typically, a Will appropriately written in one state will be recognized in another state. Of course, that’s assuming that the Will was written according to the laws of the first state. Also, there may be nuances that are easy to over look because each state has its own laws surrounding Wills and Trusts.
Keeping your Will up to date is always important. It’s even more important when you’ve moved to a new state.
Ideally you would review and update your estate planning in your new state as soon as possible. The basic principles of planning for your estate are similar across the country. However, you should ensure that any changes you need to make comply with your current state’s laws. You will want to determine how your assets are distributed to your family members so no one fights over your things after you’re gone.
The state-specific laws that govern estate planning can greatly affect your Will and other documents like trusts. Spousal property rights, taxes, and how your children inherit are the main things affected by individual state laws.
Having properly prepared documents can help you avoid a probate situation, which can be important, too. Why do you want to avoid probate, if possible? The time and cost associated with probate can drastically decrease your estate’s value. You don’t want your carefully prepared estate plan to be thrown into disarray based on your new state’s laws.
That’s another reason why, once you get settled into your new home, you should take the time to review the new state’s estate planning laws.
State Specific Estate Planning Laws: What They Mean for You
Updating your Will and Trusts can be inconvenient, yet it’s worth the effort to ensure your family is taken care of and your assets are divided according to your wishes. If you have a Will already, you’ve already made the major decisions. Updating to comply with state-specific laws should be a relatively quick process.
Marital Property Rules
Some states are community property states, while others aren’t. The state’s views on marital property can significantly impact how your assets are distributed after you die if you don’t have an updated will in place. If you and your spouse have definite views regarding how to divide things when one of you dies, then it’s even more important to update your Will when you move across state lines.
North Carolina is considered a common law, or separate property state; it’s not a community property state. The documents offered by NCEstatePlans.com are designed to be legally effective for North Carolina’s laws.
Let’s say you currently live in a community property state, meaning that spouses equally own everything, including inherited property. You are about to move to North Carolina or another common law state, which means each spouse keeps anything they had before marriage as their own. Anything obtained after getting married belongs to both people equally in the common law state.
If you’ve moved from a community property state to North Carolina, knowing how that change impacts your Wills is important, in order to ensure that your assets were divided as you and your spouse wish.
Executor of the Will
The rules for Executor of the Will vary between states too. The Executor is who you name to handle dividing your assets as you have documented once you pass away. This person (or company) pays any bills and taxes and then gathers and distributes your property and other assets to your beneficiaries.
Your Executor doesn’t need to live in North Carolina to be named in your Will. However, it is good to consider your intended Executor will be able to travel and handle matters when you’ve moved away from them.
Your Executor will have the powers allowed by the new state’s statutes, or as you’ve specifically stated in your Will. It’s important that your Will give the Executor the full authority needed to cut through red tape and settle your estate quickly and without family fights.
Power of Attorney
As with other estate planning documents, each state has its own rules regarding Power of Attorney. Some states will accept the Powers of Attorney you established elsewhere, while others don’t have clear directives regarding Powers of Attorney. You can grant separate Powers of Attorney for medical issues (like who can decide whether you get life-saving efforts in an end-of life situation) and financial issues (like who handles your bank accounts). If you want to be sure your established Power of Attorney is valid, you need to review it along with your other estate planning documents.
What About a Living Trust? Is It Valid in Another State?
Living trusts generally should hold up in a different state. But if you choose to buy a home in a new state, you should update estate planning to include any new assets. It makes sense to update your living trust to comply with any new state laws, even though the living trust is likely transferrable. Use state-specific documents when you update your estate planning to save headaches and delays when it comes time to settle your estate.
When you move across state lines, you have many details to handle while settling into your new home. Don’t forget to update your Will to reflect the laws in your ne