Having a comprehensive estate plan in place is one of the best things you can do for your loved ones and for yourself. The average plan incorporates a variety of estate planning strategies and documents. Once those documents are prepared, they need to be kept somewhere safe. A Fargo estate planning attorney at German Law Group explains why your safety deposit box may not be the best place for your estate planning documents.
Estate Planning Documents
Just as every person is unique, every estate plan is unique. There are, however, some common components found in the average estate plan. As such, there are also some documents that are routinely part of a comprehensive estate plan, such as:
- Last Will and Testament
- Trust agreement
- Power of attorney
- Life insurance policy
- Advance directive
In many cases, an original copy (meaning one with an original signature in ink) of the document in question is required in order for the document to work as intended. For this reason, your estate planning documents should be kept together in a safe place. Understandably, the first place many people think to store their estate planning documents is in their existing safety deposit box. After all, that’s probably where you keep valuable jewelry, deeds to property, stocks and bonds, and other valuables. At first glance, it makes perfect sense to put your estate planning documents in your safety deposit box as well. On closer inspection, however, your safety deposit box is not the best place for your estate planning documents.
Probate and Your Safety Deposit Box
To understand why putting your estate planning documents in your safety deposit box may not be the best choice, you need to understand some probate basics. Shortly after your death, your estate needs to go through the legal process known as “probate.” Probate serves numerous purposes, including:
- Identifying and securing your assets
- Authenticating your Will
- Paying debts of the estate
- Litigating any claims against the estate
- Paying estate taxes
- Distributing assets to beneficiaries and/or heirs
If you executed a Will prior to your death, you appointed someone to be the Executor of your estate. Your Executor is responsible for overseeing the probate process. To perform that job as intended, your appointed Executor must initiate the probate process with appropriate court and petition the court to officially be appointed as your Executor. If the court approves the appointment, the court will issue Letters Testamentary which provide proof that the Executor has been appointed by the court and therefore has the authority to act on behalf of the estate.
The problem is that in order to initiate the probate process and secure the appointment as your Executor, an original copy of your Will must be submitted to the court. If your Will is in your safety deposit box, however, the bank won’t allow access to the box without proof that the individual seeking access is the Executor of your estate. This becomes a “chicken and egg” problem. Your chosen Executor cannot secure the necessary Letters Testamentary to act as your Executor without your Will – but he/she cannot access your Will without the Letters Testamentary.
Similar problems can crop up with other estate planning documents as well. For example, an Agent with your Power of Attorney may have the legal authority necessary to access your safety deposit box; however, if the POA document granting your Agent that authority is in the box, your Agent has no way to prove that he/she is your Agent.
What Should I Do with My Estate Planning Documents?
Now that you understand why your safety deposit box may not be the best place to keep your estate planning documents, the question becomes “where should I keep them?” First, it is always a good idea to execute more than one original copy of important documents. Ask your estate planning attorney to keep one set of original documents. Also give an original copy to anyone named to a fiduciary position within your plan. Your Executor should get an original copy of your Will. A Trustee should have an original copy of a trust agreement and an Agent needs an original copy of a Power of Attorney. Finally, an original set of documents should be kept at home in a fireproof safe and/or given to a trusted family member.
Contact a Fargo Estate Planning Attorney
Please join us for an upcoming FREE seminar. If you have additional questions about estate planning or about the probate process, contact a Fargo estate planning attorney at German Law Group by calling 701-738-0060 to schedule an appointment.