A joint will is often drafted by married couples to distribute their assets and properties. Couples usually have the same goals for the future and hence agree on a joint will. However, while it is possible to get a joint will for estate planning, lawyers mostly advise against it.
Joint will have specific rules that state if one of the spouses dies, the assets and estate automatically go to the surviving spouse. And when the second spouse dies, the estate goes to their children. Married couples find this way of estate planning easier and cheaper because they do not want two separate wills when they both have the same goals for the future.
The most common problem that arises with joint wills is that they cannot be changed after one spouse dies. In most cases, the surviving spouse does not have the power to change or alter the will without the second spouse. Whatever happens after one spouse’s death, the rules of the estate plan will remain the same.
Even if the surviving spouse remarries, they cannot include their children from the second marriage in the joint will. Similarly, they cannot remove anyone from the inheritance or sell the estate or the assets. It does not matter if the spouse wants to sell some part of the estate to meet their living expenses during hard times; a ‘joint will’ cannot be altered.
The living spouse cannot add executors or beneficiaries in the joint will. The beneficiaries that were born after the joint will was decided cannot also be included. The time for inheritance is also fixed and cannot be changed if one of the spouses has passed away.
Apart from that, joint wills are not legal in some countries. Many courts and judges often separate the joint will for both spouses or declare the whole joint will invalid in some states. And in many cases, the assets and properties get tied up in the joint will for years. This can cause many problems for the living spouse.
Bankruptcy may seem like losing all your essential assets, but it is not the same as bankruptcy. Although bankruptcy significantly affects your retirement plans, it does not mean that you will lose everything you have saved for your retirement. A retirement account or retirement fund is very different from other savings or investment accounts and can be saved for your future personal needs.
There are many ways you can deal with your retirement accounts when it comes to bankruptcy. In most cases, you can keep the retirement account separate from the whole procedure. In other cases, your savings are invested in insurance or held in trust.
The government usually protect your retirement fund, but if you take money from a retirement fund and place them in a different account, the rules applied to them will change. The money that you withdraw from the retirement account will be treated as income for your debts. Hence, it is advised to refrain from withdrawing money from your retirement fund until after your bankruptcy.
You can also use bankruptcy exemptions to save some of your property, funds, household belongings, and some basic necessities to live after retirement.
Although the funds in your retirement account are exempt from creditors, the benefits paid as income are not discharged. Under chapter 7 bankruptcy, the court cannot take your retirement benefits and pensions and consider them as income. However, the court can take some amount from your retirement benefits for your own support and pay off some portion to your creditors.
Under chapter 13 bankruptcy, the court decides the amount of money to be paid to your creditors monthly on the basis of the total amount of retirement benefits or pensions you are receiving. This is done only for the debts that you must repay under your repayment plan.
Keep in mind that general saving accounts, stock option plans, and investment accounts are not the same as retirement accounts and are not protected from the court. Court has the authority to utilise your unprotected accounts to pay your creditors and essential debts under your repayment plans.
Medical bills are one of the leading causes of bankruptcy. Many people file for bankruptcy due to medical bills, even if they have health insurance. The cost of healthcare in the US is very high and often leads to bankruptcy for many people. Medical expenses are usually discharged when a person files for bankruptcy.
Medical debts can be discharged when you file for bankruptcy. But it is considered better to file for bankruptcy as a last resort. Filing for bankruptcy due to medical debt can be avoided through alternatives like suggesting and negotiating a payment plan with your healthcare provider.
This is done to avoid the claim going to collections where you do not have freedom over your funds. When you file for bankruptcy, the trustee ensures that all the creditors are repaid as soon as possible. Discharge of medical debt mostly depends on the amount of debt and the type of bankruptcy you filed for.
Medical bills are considered to be unsecured nonpriority debts in bankruptcy and can be discharged easily. In the case of chapter 7 bankruptcy, the trustee sells all your assets to repay creditors. At the end of that process, the medical bill is usually discharged even if you didn’t raise any funds to pay the healthcare provider.
However, there are downsides to filing Chapter 7 bankruptcy because the trustee has the authority to sell your property. Losing property can lead to losing your home or other land you may own. Hence chapter 7 bankruptcy is only for those who are critically low on funds.
In the case of chapter 13 bankruptcy, you may have to repay medical bills over the course of time from your income. This helps build a good relationship with your healthcare provider because you are at least repaying some of the medical bills.
If you are only facing medical debt, filing for bankruptcy is not the best option for you. Alternatives for avoiding bankruptcy filing include debt management plans, consolidating your debt, raising money, negotiating with the health provider, etc.
Non-dischargeable debts are those which are not ruled out when you file for bankruptcy proceedings. Often when a person files bankruptcy in court, many debts are discharged, and the person is no longer obligated to pay those debts. However, some debts need the creditor to challenge your discharge during bankruptcy to make it completely non-dischargeable.
The process usually includes the court making the decision after listening to both parties, i.e., the person filing for bankruptcy and the creditor. If the court disagrees with the creditor, your debt can be discharged.
There are many conditions under which your debts are non-dischargeable after filing for bankruptcy. This includes debts due to fraudulent acts, debts from marital settlement or divorce decrees, debts from embezzlement, a breach of fiduciary responsibility, larceny, or debts from willful or malicious acts to another person.
Most of the non-dischargeable debts arise from acts of fraud or unlawful practices. Other types of non-dischargeable debts include payment owed for personal injury to a person by the debtor.
Moreover, creditors have the right to object to the discharge of debts. If the court agrees with the creditor, the debts become non-dischargeable. These include purchases of luxury items made by the debtor that were acquired within 90 days of filing for bankruptcy. However, the debtor can discharge these debts by assuring the court that they will repay the creditor and that the purchases were not luxury items.
Other situations in which the debts become non-dischargeable are when the debtor does not have proof or record of their finances and property settlements to show to the creditor. The court declares the debts incurred from creditors non-dischargeable when you cannot account for your missing assets due to a lack of records.
Furthermore, debts can also become non-dischargeable if you file for bankruptcy too often. You cannot get discharges on debts if you file for bankruptcy within eight years after you filed your first bankruptcy case. Your previous bankruptcy filing can serve as grounds for your latest debts to be discharged or not. This depends on the type of bankruptcy and the settlements of your last bankruptcy.
If you are having trouble settling your debts or are unsure if negotiating a settlement is appropriate, you might be considering hiring a lawyer to help you negotiate with creditors. However, it is possible to arrange the debt settlement yourself rather than hiring someone to do it.
Negotiating your settlement may help you to save money and it also puts you in a position to maintain control over the process. Some creditors may be reluctant to settle if you hire someone to represent you in the process. However, debt settlement attorneys may be the best option because they will be able to work out a better settlement compared to if you approaching the creditors on your own.
The advantage of hiring a skilled lawyer is that they can provide you with legal advice after analyzing the situation and they can also represent you if the creditor chooses to file a lawsuit against you. They will go over all the possible options and help you to figure out the best option. A debt settlement attorney can negotiate with lenders to perhaps lower the amount that you owe them. Before hiring a debt settlement attorney, it is important to research what they can do for you.
If you have a huge debt and lack the necessary funds to cater for the debt, you might need to consult an attorney. Hiring a lawyer can be the best move for you because, a debt lawyer can not only offer advice but they can find a way to combine your debts into a single huge debt with beneficial terms of payment. A lawyer will be able to figure out the best strategy that will help you to minimize risk.
It is vital to note that when it comes to paying debt lawyers, they are paid on contingency. This means that you might not have to pay anything at first but your lawyer will be entitled to a part of the profit should you win the case. Pricing may vary depending on how much you owe, how much they win you or save you, and where you live.
