A last will and testament is the basic document of an estate plan, which is how you direct assets according to your wishes after you have died. However, there are certain things that do not belong in a will, and it’s important to know what they are. Mistakes can lead to expensive and worrisome complications, says the article “Things you should never put in your will” from msn.com.
Your will can get very specific about who receives what in the way of your personal possessions. For example, you can give your car to a family member of your choice. What you can’t do is tell the family member how they can use the car, or if she should never sell the car. Enforcing conditional wishes through a will isn’t legal, nor is it practical.
If you want to control aspects of an inheritance, the best way to this is through a trust, which allows you to set terms that are enforceable, even after you have died. A trust is a legal entity with a trustee and the law to enforce its terms. You can set goals or milestones for heirs best with a trust.
Leaving assets out of your will actually benefits family members in many regards. First, they’ll receive their inheritance faster. Upon death, your will must be reviewed and validated in a court of law in a process known as probate. Depending on your jurisdiction and the complexity of your estate, this can take months and, in some cases, years. Papers have to be filed, judges have to review it and determinations must be made. Wills can also be contested in court, further tying up assets and slowing the process of distribution.
Putting property in a trust or having accounts that are Payable On Death (POD) will speed up the process for heirs.
Don’t put anything in a will that you don’t own outright. If you are a co-owner with someone, upon your death, the other owner will become the owner, with no need for court involvement.
Trusts are a key tool in estate planning, used to avoid probate and increase control of assets. Once property is titled into the trust, it becomes subject to the rules and directions of the trust, which are explained in detail in the trust documents. Nothing placed in a trust should be included in a will to avoid any confusion and delays.
Certain accounts and assets are payable or transferable on death. They are distributed directly to heirs, so putting them in a will is not necessary. These are accounts with beneficiary designations, typically brokerage or investment accounts, retirement accounts, pension plans and life insurance policies.
Business interests can be given through a will, but you don’t want to do this. Succession could be contested, and your business partners may be left with a big headache, instead of focusing on transitioning the business to the next generation of owners. Your estate planning attorney will be able to help create a succession plan that will align with your estate plan. The two need to work together.
Once deemed valid by the probate court, your last will and testament becomes a public document. Anyone who wants to read it, can do so. Your will should not include any account numbers, account values, login information, passwords, or any information you would not want to be shared in public.
Reference: msn.com (July 11, 2021) “Things you should never put in your will”
Suggested Key Terms: Last Will and Testament, Probate, Trusts, Succession Plan, Payable On Death, POD, Co-Owner, Heirs, Beneficiary Designations, Retirement Accounts, Pension Plans, Estate Planning Attorney