A will is one of the primary and smartest ways to transfer your assets upon your death. You need a will unless all of your property is nonprobate property or will be transferred by contract. A will is not estate planning. It is written after all the other aspects of estate planning are completed.
Transfers with a Will Go to Your Desired Heirs A will is a written document in which a person, the testator, tells how his or her remaining assets should be given away after death. If you die without a will, the probate court will follow state law to determine how your assets will be distributed. A simple will that is prepared by an attorney can cost $125 to $400. Minor changes in a will may be made with a codicil instead of revoking the existing will and writing a completely new one, as you would when making major changes. People usually know exactly what they want to do with their property, so they can use software and online programs to prepare an uncomplicated will. Examples include BuildaWill .com, Kiplinger’s WILLPower, LegalZoom, and Quicken WillMaker.* If you die with a valid will, the probate court will transfer or distribute your property according to your wishes. A person who inherits or is entitled by law or by the terms of a will to inherit some asset is called an heir. A will that is properly drafted signed, and witnessed is unlikely to be successfully challenged by someone who is dissatisfied with the intended distribution of assets. If you have a complicated estate, you should seek the assistance of an attorney who specializes in estate planning.
Transfers with a Will Go to Your Desired Heirs A will is a written document in which a person, the testator, tells how his or her remaining assets should be given away after death. If you die without a will, the probate court will follow state law to determine how your assets will be distributed. A simple will that is prepared by an attorney can cost $125 to $400. Minor changes in a will may be made with a codicil instead of revoking the existing will and writing a completely new one, as you would when making major changes. People usually know exactly what they want to do with their property, so they can use software and online programs to prepare an uncomplicated will. Examples include BuildaWill .com, Kiplinger’s WILLPower, LegalZoom, and Quicken WillMaker.* If you die with a valid will, the probate court will transfer or distribute your property according to your wishes. A person who inherits or is entitled by law or by the terms of a will to inherit some asset is called an heir. A will that is properly drafted signed, and witnessed is unlikely to be successfully challenged by someone who is dissatisfied with the intended distribution of assets. If you have a complicated estate, you should seek the assistance of an attorney who specializes in estate planning.
Your will should name an executor (or personal representative). This person ought to be good with paperwork because he or she is responsible for carrying out the provisions of a will and managing the assets until the estate is passed on to heirs. The executor identifies assets, collects any money due, pays off debts, liquidates assets, files final income tax and estate tax returns, and with the court’s permission distributes the balance of any remaining money and property to the beneficiaries. Some people select a friend or relative to perform the executor’s duties, whereas others name an accountant or attorney to play this role. The executor’s fee for carrying out these complicated tasks ranges from 1 to 5 percent of the estate. If you have minor children, you should appoint a legal guardian for each child in your will. This person is responsible for caring for and raising any child under the age of 18 and for managing the child’s estate. The guardian should be someone who shares your values and views on child rearing. Financial columnist Michelle Singletary suggests that you might avoid as potential guardians those who are too old, too ill, or too tired from raising their own children, and those who don’t really know the children. Consider naming an alternate candidate in case your first choice cannot take on this responsibility. If you have not taken steps to name a legal guardian, the court will appoint one.
Many people prepare a nonlegal letter of last instructions along with their will that may contain suggestions and recommendations regarding funeral and burial instructions, organ donation wishes, material to be included in the obituary, contact information for relatives and friends, and other information useful to the survivors, such as the location of important documents. A letter of last instructions may specify that certain pieces of jewelry or art are to go to specific people. If the will contains different instructions on these matters, the will prevails. Family members and others are not legally bound by details in a letter of last instructions. Your original will and letter of last instructions should be kept in a safe place, such as a safe-deposit box or at an attorney’s office. Copies may be given to certain family members or friends.
Without a Will, Your Property May Not Go to the Correct Heirs When a person dies without a valid will, the deceased is assumed to have died intestate. In such a case, the probate court will divide all property according to a set formula and transfer assets to the legal heirs. If no surviving relatives exist (a rare situation), the estate will go to the state by right of escheat. Your friends and charities will get nothing. If you die without leaving a valid will, the intestate succession laws in the state in which you lived prior to death then determine how your property will be divided. This legal determination may force your heirs to share money in ways you did not intend, and those provisions may exclude distribution of your assets to nonmarital partners, stepchildren, friends, and charities. The probate court will also ensure that the debts, income taxes, and expenses of the deceased are paid. Dying intestate can cost much more in taxes and cause legal, bureaucratic, and emotional struggles for survivors.
When one dies without a will, the manner in which the assets are divided varies enormously from state to state. For example, one state might make the following distributions of a $120,000 estate: If a person with no surviving kin except a spouse dies without a will, the spouse receives the entire estate of $120,000. If the deceased had children with that spouse, the spouse takes $60,000 and the balance is divided equally between the spouse and their children. If the couple was not married, the children would get 100 percent. If the deceased also had children from another marriage, one-half of the estate goes to the spouse and the balance is divided among all his children. If a spouse and a parent survive the decedent, the spouse receives $60,000 and one-half of the balance, with the remainder passing to the parent. As you can see, state laws contain a number of complex provisions that govern what constitutes a legal heir and how much (if any) of an estate an heir may be entitled to receive. What may appear least fair in the intestate distributions just described is that, if the decedent has no children, his or her spouse may be required to share the assets with a distant relative. More than half of all adults and two-thirds of all parents with dependent children do not have wills.
Many people prepare a nonlegal letter of last instructions along with their will that may contain suggestions and recommendations regarding funeral and burial instructions, organ donation wishes, material to be included in the obituary, contact information for relatives and friends, and other information useful to the survivors, such as the location of important documents. A letter of last instructions may specify that certain pieces of jewelry or art are to go to specific people. If the will contains different instructions on these matters, the will prevails. Family members and others are not legally bound by details in a letter of last instructions. Your original will and letter of last instructions should be kept in a safe place, such as a safe-deposit box or at an attorney’s office. Copies may be given to certain family members or friends.
Without a Will, Your Property May Not Go to the Correct Heirs When a person dies without a valid will, the deceased is assumed to have died intestate. In such a case, the probate court will divide all property according to a set formula and transfer assets to the legal heirs. If no surviving relatives exist (a rare situation), the estate will go to the state by right of escheat. Your friends and charities will get nothing. If you die without leaving a valid will, the intestate succession laws in the state in which you lived prior to death then determine how your property will be divided. This legal determination may force your heirs to share money in ways you did not intend, and those provisions may exclude distribution of your assets to nonmarital partners, stepchildren, friends, and charities. The probate court will also ensure that the debts, income taxes, and expenses of the deceased are paid. Dying intestate can cost much more in taxes and cause legal, bureaucratic, and emotional struggles for survivors.
When one dies without a will, the manner in which the assets are divided varies enormously from state to state. For example, one state might make the following distributions of a $120,000 estate: If a person with no surviving kin except a spouse dies without a will, the spouse receives the entire estate of $120,000. If the deceased had children with that spouse, the spouse takes $60,000 and the balance is divided equally between the spouse and their children. If the couple was not married, the children would get 100 percent. If the deceased also had children from another marriage, one-half of the estate goes to the spouse and the balance is divided among all his children. If a spouse and a parent survive the decedent, the spouse receives $60,000 and one-half of the balance, with the remainder passing to the parent. As you can see, state laws contain a number of complex provisions that govern what constitutes a legal heir and how much (if any) of an estate an heir may be entitled to receive. What may appear least fair in the intestate distributions just described is that, if the decedent has no children, his or her spouse may be required to share the assets with a distant relative. More than half of all adults and two-thirds of all parents with dependent children do not have wills.
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