Congratulations on the purchase of your new home! Whether this is your first home or you are moving to a new home, the purchase of a home is a big event in your life. When major life events occur, it is important that you have a plan in place to ensure that you are properly prepared for the future. Below are a few things to consider now that you finally have the keys to your new home.
1. Make Sure That Your House Title Coordinates with Your Estate Plan
Take a look at your new deed to determine how your new home is titled. Ideally, you had a discussion with an estate planning professional prior to purchasing the new property to determine how you would like to own your new property, whether in your name individually, jointly with a spouse, or in the name of your trust. It is important to review your current estate plan after the purchase of the home to ensure that it aligns with your estate planning goals.
If your plan had a specific instruction to give your prior property to someone, and the instruction references the address of your prior home, you will want to ensure that you update this provision once you no longer own the previous property to avoid confusion down the line.
If your estate plan includes a trust to avoid probate, you will need to ensure that your home is titled in the name of the trust and not in your name individually.
2. Check Your Life Insurance Coverage
Unless you were fortunate enough to pay cash for your new home, chances are you now have a monthly mortgage expense. In order to protect your loved ones, it would be prudent to prepare for the possibility of dying before you pay off your mortgage. You may want to consider whether you have enough life insurance to pay off the balance of the mortgage. This is especially important if you have a surviving spouse or children who will likely continue to reside in the home to ensure that they have sufficient funds to alleviate one of the largest monthly expenses they will probably have. Life insurance can provide valuable funds during what is usually an emotionally—and sometimes financially—difficult time.
3. Review Your Beneficiaries
When you buy a new home, it is a great opportunity to double check your beneficiary designations. Life changes happen so quickly that sometimes updating beneficiary designations can be overlooked. If your designations do not align with the rest of your estate plan, you may end up inadvertently disinheriting a family member, having a large sum of money fall directly into the hands of an individual (for example, a young adult or minor child) without any guidelines, or having your hard-earned money and property go to someone you no longer want to benefit from your life insurance.
We Are Here to Help
Buying a new home is a big step, and we are here to help you plan to protect both your loved ones and your new investment. Give us a call so we can help ensure that your new purchase and your estate plan are working together to accomplish your goals.
If you have any additional questions about estate planning, or would like to consult an estate planning professional, please contact our offices. We can make sure you have a comprehensive plan that is tailored to your unique needs and goals. Call today for a FREE 15-minute consultation — 888-403-1259 — or click this link to book an appointment online today: https://carsonlaw.com/consultation/.
Christian Carson
Christian Carson is the founding attorney of Carson Law Firm LLC in Cleveland, Ohio. He holds degrees in law and accountancy from Case Western Reserve University. With a strong background in accounting and finance, Christian focuses on real estate, probate, and business law. He is committed to providing practical legal solutions for individuals and small business owners.
