How Can We Protect Our Family Home in Our Estate Plan?

For many young couples, the first family home they buy is both a major financial asset and the center of everyday life. Your home is where you raise your children and where you have invested much of your savings.

That makes the home an important part of your estate plan. If something happens to one or both spouses, it’s important to have a plan that is not simply to decide who inherits the house. A good plan should also address who can manage the property and how any children can remain financially secure. For high-net-worth families, these questions can become more complicated because the home is only one part of a larger financial picture. 

If you recently bought a home and are creating your first estate plan, our Naperville estate planning attorney can help you make sure your home is protected along with the rest of your family’s wealth. We offer customizable estate planning packages, including for married couples with young children and valuable assets. Contact us at 630-756-1160 today.  

Should We Put Our Family Home in a Living Trust?

For many married couples, a revocable living trust is an important part of planning for the family home. A revocable trust allows you to continue controlling the property during your lifetime. You can change the trust as your family or finances change. If one spouse dies, the trust can explain what happens to that spouse’s interest in the property. It can also provide instructions for what should happen after both spouses have died.

One major advantage is avoiding probate for property that has actually been transferred into the trust. Signing a trust document alone is not enough. Under the Illinois Trust Code, real estate must be transferred to the trustee through a written instrument of conveyance. In practical terms, that usually means preparing and recording a deed that places the home into the trust.

This is very important. A trust that was not properly funded will not accomplish what a family needs it to. If the house remains titled outside the trust, probate may still be necessary after death.

A properly funded trust can also make incapacity easier to manage. If one or both spouses become unable to handle financial matters, a successor trustee can take over management of trust property according to the terms of the trust.

What Happens to Our Home if One of Us Dies?

For many couples, the first goal of estate planning is simple: make sure the surviving spouse can remain in the home. How that happens depends on the way the home is owned and how the estate plan is written. In some plans, the surviving spouse simply continues controlling the home through a joint revocable trust. In others, the deceased spouse’s interest may remain in a trust designed to benefit the surviving spouse.

For higher-net-worth families, there may be sensitive reasons not to transfer everything outright to the surviving spouse. Trust planning can provide more control over how property is ultimately preserved for children while still allowing the surviving spouse to use the home.

The right structure depends on the family. A couple with young children may want the surviving spouse to have maximum flexibility. A couple with children from prior relationships may have different concerns about who ultimately receives the property. Whatever the situation may be, the most important part of having an estate plan is that the plan should make answers to difficult questions clear before there is a crisis.

How Can We Protect the Home for Our Children?

Parents often say that they want their children to inherit the family home. For young children, however, simply naming them as direct beneficiaries creates practical problems.

Minor children cannot manage a house themselves. If both parents die, someone will need to care for the children while someone also manages the assets left for them. Those do not necessarily have to be the same person.

Illinois law allows parents to nominate a guardian for a minor child, although the court ultimately makes the appointment. A trust can separately name a trustee who is responsible for managing the money and property left for the children.

That distinction can be valuable for families with substantial assets. The person you trust to raise your children may be excellent at parenting without being the person you want managing a large inheritance.

A trust can also prevent children from receiving valuable property outright as soon as they become legal adults. Instead, the trustee can continue managing the assets according to the terms you chose. This can give children time to mature before they gain full control of substantial wealth.

For the family home, the trust can explain whether the property should be kept for the children or sold. It can also give the trustee flexibility if keeping the house no longer makes financial sense.

Can Estate Planning Protect the Home if We Become Incapacitated?

Death is not the only event an estate plan should address. A serious accident or illness can leave someone unable to manage a mortgage or make decisions about a property. A revocable trust can provide continuity because a successor trustee may be able to step in and manage trust property when the current trustee can no longer do so.

A financial power of attorney can also be important. It can authorize another person to handle financial matters that may fall outside the trust. For a young family with children at home, incapacity can be just as disruptive financially as death. Planning for both situations helps make sure someone has clear authority to act rather than forcing family members to seek court intervention during an emergency.

Call a Naperville Estate Planning Attorney Today

Protecting your family home means thinking about much more than who gets the deed after you die. Your estate plan should make sure the right people can manage the property and that your children are protected if something happens to both parents.

Our Naperville estate planning lawyer at Gierach Law Firm can help you build a plan that coordinates your home with the rest of your family’s assets and long-term goals. Call Gierach Law Firm at 630-756-1160 to discuss your estate plan.