Last Will and Testament
The Last Will and Testament is an integral part of estate planning. It allows you to appoint someone to manage your estate, designate beneficiaries to receive your assets and personal belongings, establish guardianship for minor children, and express your burial preference.
In essence, the last will and testament is the package that ties up loose ends of your life. Without it, you will be leaving a huge mess for your loved ones. You forego having any say-so in how your assets are distributed. Instead, a judge will make decisions based on probate laws
Executing a Will is the greatest gift you can give your family. When loved ones don't take time to write out their will it creates a heavy burden during an already difficult time. You don't want to leave a mess for your family to clean up do you?
Numerous options exist for creating a last will. Some websites offer downloadable forms, which can be filled out and notarized. Office supply stores sell preformatted wills that only require you to fill in the blanks.
Many banks and credit unions offer estate planning services to their customers. Estate planning can be as simple as executing a Will to establishing revocable or irrevocable trusts. Prices can range from under $100 to several thousand. Much depends on the size and value of the estate and the work involved.
Individuals who own real estate, businesses and valuable assets, should consider establishing a trust and last will. With trusts, the Will is held within the trust; exempting them from probate and inheritance tax.
Probate is required on all estates not protected through a trust. When a person dies everything they own is held in probate. The process involves validation of the will, confirming the designated estate administrator, paying outstanding debts, taking inventory and obtaining property appraisals, and filing a final tax return.
The probate process generally takes between six and nine months, but can last as long as three years. Much depends on the workload of the court, estate value, and how well the heirs or beneficiaries get along.
Probate is a platform where heirs can air their grievances. If the decedent did not leave them what they expected or disinherited them from the will, heirs can contest the will. This act rarely accomplishes anything other than fattening the wallets of attorneys and bankrupting the estate.
Experts recommend retaining the services of a probate lawyer or estate planner to act as the administrator when family dysfunction exists. Death does strange things to people. Fights break out at funerals. Brothers and sisters argue over who will receive a family heirloom. Distant relatives crawl out of the woodwork to see if they were gifted money through the decedent's will. It's really quite bazaar, but it happens all the time.
This is good example of where a trust comes in handy. Trusts are generally reserved for estates valued over $100,000. Assets held in trusts bypass the probate process and are quickly distributed to named beneficiaries.
Steps can be taken to keep estates valued below $100,000 out of probate. These techniques are outlined in my article, "Avoid Probate: Five Ways to Protect Your Assets". Four of the five strategies don't cost a dime and take less than ten minutes of your time.
As one who has traveled down the road of administering an estate where the decedent died intestate (without a will), I can tell you it is not a pleasant experience. The only way to make certain you are granted your final wishes is by establishing a valid Last Will and Testament.
If you would like to learn more, visit our last will and testament library, which includes numerous articles on estate planning, inheritance and probate.