Even during a pandemic, few people want to spend time thinking about death. However, having an estate plan means having some of the most important documents you’ll ever create. Having it is a gift that alleviates the burden placed on loved one, says this recent article “Why it’s important for every adult to get a will” from Bankrate. In a time of sorrow, the family and friends will be spared the stress that makes grieving more complicated when there is no guidance and no path forward.
What is a will?
In its most simple form, it is a legal document that serves to transfer property at your death to the people you choose. It is revocable, which means you have the legal ability to make changes to it, as long as you are alive and have the mental capacity to do so. However, they do more than distribute property. It is your chance to state your wishes for who cares for your children, what happens to your physical remains and who will take care of your pets.
Are Wills Pretty Much the Same?
There’s a good reason why the best wills are those created with an estate planning attorney: they are created to suit your specific needs. Just as every person is different, everyone’s will must reflect their life. Some people want to name a recipient for every single asset they have, while others prefer simply to give their entire estate to a spouse, their children, a trust, or a charity. However, there are also different kinds of wills.
A Testamentary Will is signed in the presence of witnesses. It is the best choice to protect your family.
A Holographic Will is a handwritten will, which is not acceptable in many states and could lead your family into all kinds of expensive and stressful battles, in and out of court.
An Oral Will is declared in front of witnesses, but don’t count on anything you say being considered a legally valid.
A Mutual Will is also known as a “I love you Will,” when partners create a joint will leaving everything to each other. There can be some tricky things about these wills, since when one person dies, the other is still legally bound to the terms of it. If the surviving spouse remarries, it can become complicated.
A Pour Over Will is the ideal choice, when your plan is to pour assets into an established trust at your death.
What does a will do and not do?
Wills are used to determine guardianship for minor children and distribute assets and real property. Wills don’t control jointly owned assets, or contracts, like life insurance policies and retirement accounts. These are controlled by beneficiary designation forms. It won’t matter if it says that your current spouse should inherit your retirement account and you never changed the beneficiary from your first spouse. This is why estate planning attorneys always tell clients to check on beneficiary designations when large life events, like divorce and remarriage, occur.
What happens if there is no will?
Without it, the state’s laws will determine what happens and your wishes don’t count. That includes who inherits your property, and even who raises your minor children. The court will make all of these decisions. The stress that this creates cannot be underestimated. When there is no will, the chances of litigation between family members and trouble from distant relatives seeking a claim against your estate rises.
Reference: Bankrate (Nov. 6, 2020) “Why it’s important for every adult to get a will”
Suggested Key Terms: Will, Estate Planning, Minor Children, Beneficiary Designations. Testamentary, Holographic, Oral, I Love You Will, Pour Over, Guardianship, Revocable