FISCALLY FIT LEGACY SERIES
Make a Will
I’ve been reading a lot of articles and blogs written about making a will lately, and they all pretty much say the same thing. Wills are simple to create, yet most Americans don’t have one. This legal document is vitally importantin ensuring that your wishes for distributing your assets or naming a guardian for your minor children are carried out. If you die without a will, the state will get involved and it will make those decisions for you. While I already knew a lot of this, there were a few interesting things I didn’t already know that I’d like to share.
Some Key Notes on Wills
Everyone Over 18 Needs a Will
A couple of days ago, I asked a young friend of mine if she had a will. I explained to her that I am gathering material to write this post, and I was just curious what her thoughts were. I assured her that I had no intention of telling her what she should do. At 24 years of age, this young woman is very responsible, works full time while going to college and is engaged to be married. She confessed that while she had considered the idea that she should have a will, she honestly didn’t think she had enough assets, or was really old enough to have such a document.
Intrigued, I called my 26 year old daughter, and asked her the same thing. Her reply was almost identical in that she didn’t feel old enough, and didn’t have enough assets. In both cases, each young adult reasoned out the instances where having a will at their young age actually makes sense; in the event of their untimely death, or if something tragic befell them and they were left incapacitated and unable to care for themselves or make their own decisions.
When someone reaches the age of 18, he or she officially becomes an adult in the eyes of the law. Whether you are in your 20s or 80s, it is the same when it comes to having a will that states how your affairs will be handled after you die.
A Will is Public Record
All wills must go through a legal process called probate, where an authorized court administrator examines them. This process can be lengthy, sometimes taking more than a year, and potentially contentious if family members contest the will. Trusts are not required to go through probate, and cannot be contested. We will talk about trusts in an upcoming blog.
A Will is used for Appointing Guardians of Your Minor Children
If you have minor children living at home, it’s important to have a will that appoints guardianship of your children. Otherwise, the court will appoint someone. You want to be the one to choose someone who is not only prepared to care for your children until they are 18, but who is close to you and your children. Be sure to discuss this decision with both your children and also the potential guardian. You might consider naming an alternate guardian in the event something happens to your first choice.
A Living Will is for the Living
As the name implies, a living will guides end-of-life decisions if you are still alive, but not able to make them yourself. While a last will and testament is for after death, a living will gives instructions to your family and doctors about what medical treatment you do and don’t wish to have if you should become incapacitated, and becomes effective at that time.
Everyone should have a living will! One of those young adults I spoke to the other day rides a motorcycle. They both drive cars. Heck, we all drive cars! While it is unlikely any of us will end up in an irreversible coma as a result of a car accident, if it should happen, having a living will in place will provide guidance for making decisions on our behalf.
A Handwritten Will is called a Holographic Will
These are valid in about half the states. Type-written wills are considered more formal and are preferred in all cases.
To be recognized as valid, a will must be clear and unambiguous, signed and dated by the will-maker, and signed by at least two witnesses who are over 18 and are not beneficiaries.
Put Your Pets in Your Will
While it’s illegal in some states to name your pets as beneficiaries, you can name a guardian and leave money to that person to cover the costs of caring for your pet. You can even direct the sale of specific assets, with the proceeds going to your pet’s new guardian for upkeep expenses.
A Will Allows You to Disinherit a Child
If you choose to do so, check with your state laws for the specific details on this. A spouse can also be disinherited under special circumstances, depending on the laws governing your state; a person may only disinherit a spouse in a community property state. Each state has a different set of stipulations on what and how much can be disinherited. A spouse or child can only be disinherited through a will and not a trust.
How to Do It
Whether your estate is simple or complex, the steps are essentially the same.
- Make a list of your assets. Include the obvious financial accounts and real estate, and don’t forget your digital assets, pets, vehicles, rare stamp collection, etc.
- Make a list of your beneficiaries. Be specific; full name, date of birth, address.
- If you have minor children, name a guardian. Don’t forget to give guardians access and authority to work with any insurance or savings accounts you’ve set up for your kids (like a college fund). That way you know the money is going where you intended.
- Give instructions for your pet.
- Choose an executor. Be sure and ask them first! Choose someone who is mature, level headed, ethical and responsible, and that you trust. Because of probate this could be a lengthy process depending on the complexity of your estate.
- Name a “residual beneficiary” to receive anything left over after all bills, debts, and taxes have been paid and assets distributed. A residual or remainder beneficiary receives property left over after all specific distributions of property are made. For example, if Antonio makes a will leaving his home to Edwina and the remainder of his property to Elmo, then Elmo is the residuary beneficiary.
- List funeral preferences. One of the most memorable funerals I ever attended was one that had been planned in great detail by the deceased. She chose all the readings, songs, and even requested a few songs by her good friend who was a renowned jazz singer, much to the delight of all. She even designed the menu and entertainment for the reception afterward. While there was not a dry eye in the house, we all felt the exuberance and love of life this dear friend had had while she was alive.
- Print the will and get it signed. A will is not valid unless it is signed and dated by you and two witnesses who are over 18 and who are not beneficiaries. There is no requirement to have it notarized, although it is a good idea, and will prevent your witnesses from having to appear in court to confirm that that they saw you sign the will.
- Keep it in a safe place. Tell your executor and everyone involved and included in your will where to find it.
- Let everyone know. You can remove the mystery of what’s in your will be letting everyone know before you’re gone. Taking away the element of surprise can eliminate any heartache later on.
- Update your will as needed. As you move through life, you will experience changes, marriage, children, divorce, a move to a different state, more children. You can update your will as often as needed. Even if you don’t think it needs updating, it’s a good idea to review it every two or three year to refresh your memory.
Do You Need a Lawyer to Make a Will?
Making a will is easier than many people think, and if your estate is small, simple, and modest, you can probably skip an attorney. But if you have a large estate, have assets in another country, or plan to disinherit someone, an attorney would be needed.
Making a Will is a Gift of Love
At a time when your family and loved ones are grieving your loss, it makes the management of your assets clear to everyone. It is an ultimate gift of love, while leaving a legacy of intention and generosity.
Articles consulted as inspiration for this blog:
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