Ignorance Is Not Bliss
Ignorance of the law is no excuse. When it comes to legal matters, you must be aware of the fine print. “The devil is in the details”, meaning there are details that can cause you trouble if ignored.
Doing business without a license, dying without a will, or agreeing to do a project on a handshake with no written contract. These are examples of situations that can be improved with legal documents.
While reviewing our wills recently, my wife had questions about some legal phrases. I was able to explain since I had taken classes on business law in both my undergraduate and graduate studies. And my thought was sure I knew because I had a chance to study law. Most people do not!
In most cases, not knowing how to read the details on legal documents can be hurtful. Certainly, ignorance is not bliss!
Laws Keep Us in Line
Our founding fathers in the United States wrote the US Constitution to include both federal and state court systems, which are structured hierarchically. These concepts were rooted in the English common law tradition. Federal laws take precedence over conflicting state laws.
Essentially, laws determine right and wrong or good and bad behavior. Laws keep us in line.
Most laws come about because someone was ill-treated or treated unfairly with no recourse, no way to get justice. Laws are passed in the state and federal legislatures to remedy such situations. The court systems refine the use and interpretation of those laws.
A lawyer is a licensed attorney who advises and represents clients in legal proceedings, including court cases and contract negotiations. You should plan to use a lawyer to help you stay within the legal lines.
Protect Your Assets
My study of business law related mostly to contract law. And there were two memorable points made about that. First, you can put anything in a contract if it can be agreed to. Second, the contract is as good as the paper it is written on, with signatures of those agreeing to the terms.
Contract law is a simple concept and will be of great value for you to understand.
For instance, we try to protect ourselves and our property from losses by buying insurance, a contract, for our home, our vehicles, other property, our health care, and our life. The types of coverage will include limits of liability to the insurance company and your deductible. Have you read your policies lately? The devil is in the details. Do you feel good about your coverage?
Are your assets protected? What did you agree to? Do you know? Take the time to read the fine print.
Get a Will for Testament
A testament is a legal will or proof or evidence of something. Making sure you have a will in place will give some assurance of what will happen to your possessions when you die. If you fail to make that legal document, the state you live in will make those decisions for you, when they have the time. If your family wants a quick settlement, the will can make that happen.
The will is a testament of how you dispense of your assets and obligations.
There are variations, depending on the size of your estate, your assets, like a Living Trust and other ways to frame your wishes for your beneficiaries. See an attorney for more information.
Keep Records in a Safe Place
A fire safe, a lock box, or other protected file storage is important for legal documents. That includes life insurance policies, vehicle titles, deeds, loan documents, investment contacts, and evidence of beneficiaries. Your will, power of attorney, and a health directive will prove who takes care of your financial and health decisions if you cannot.
That is a sobering thought. Those are legal matters covered by legal documents, contracts you have made.
Protect your legal documents. If they get destroyed in a fire or flood, you will have great difficulty proving they ever existed or where to find copies for proof.
Only Trust a Written Contract and Notarized Signatures
I know electronic signatures are normal these days. However, get real paper documents when you can. It is easier to read the fine print!
If your identity is stolen, notarized documents are easier to prove than electronic files.
If you must go to court, a written contract with notarized signatures is proof of the agreement.
Contracts for Loans
Loans, including credit cards, will include the amount of the loan or credit limit, the interest to be charged, the payment due date, late fee calculations, and if an early payoff is allowed.
Do you know the details of your loans and the related interest calculations?
Remember, this is a legal contract that you agreed to pay and be taken to court if you do not.
Account for Your Living and Passing
There are many people who look at laws as an invasion of their privacy, and some may be. However, laws were meant to help protect your rights and the rights of others when someone gets out of line.
Laws make you accountable for how you live, if it adversely affects others. Pay attention to what is legal and what is not. Details matter.
Don’t forget tax laws. The tax code is tax law. There are several volumes to read through. I used to help file taxes. There are a lot of details to be aware of.
There is tax law related to your passing. Luckily, there is a high threshold for taxing an inheritance or the sale of your personal home. Those are good legal details to know.
Legal details help you make better financial decisions.
Understanding the legal framework for a will and naming beneficiaries for assets will be very important to your heirs.
Know what you have. Know what details are in your contracts. Know your obligation details. Know who will make your decisions, if you cannot. Know who gets your property when you go, if you have anything left!
You Are Legal—Be Legal
You have a birth certificate. You can get a driver’s license. You can get a passport. You are legal and can prove it with a Social Security Number.
Protect your legal entity. You need it for your banking, employment, and retirement benefits.
Yes, you could go off the grid and live in the woods. But it would be better to own the property. And that would require legal documentation.
You are legal. Learn how to be legal. Study your contracts before you sign them! Know what you obligate yourself to with loan contracts.
Accumulate assets and investments. But protect your legal rights and your risks with good insurance policies.
Ignorance of the law is not bliss. Read the fine print on contracts. Laws will affect most every aspect of your life. Act accordingly.
You are legal. Be legal.