Wills - Research Answers Surrounding Wills
Wills are powerful documents that grant opportunity to have your final say. People often underestimate the necessity for a last will and testament. Not only do Wills let you decide who receives your property, they are prudent for establishing legal guardianship for minor children.
Countless questions surround Wills. A lot of people are uncertain of how to setup a Will. Uncertainty often leads to procrastination. If tragedy strikes everything the decedent owned will be tied-up in probate until the courts figure out what to do with their belongings. It's not a scenario most people want to envision, but it can be prevented by taking time to write a Will.
The process for writing a Will is pretty straightforward. You'll need to figure out what property should be included and who receives it. You'll need to decide who will be your personal representative in charge of settling the estate.
If you have minor children, you'll need to arrange legal guardianship and decide what inheritance property will be given to them. When leaving inherited wealth to minor children, you'll need to choose a property custodian to manage the trust until they reach legal age.
The type of Will you need depends on personal situations and kind of owned assets. If you don't own much property and your net worth is less than $100,000 a basic Will might suffice.
If you own a lot of property and your net work exceeds $2 million, you might want to establish an irrevocable life insurance trust to offset estate taxes.
Talking with an estate planner can squelch uneasiness and help you determine which strategies will best protect your assets upon death. It would take a book to outline every possible scenario and summarize strategies that offer estate protection.
While Wills are a powerful tool for protecting assets, there are certain things they do not accomplish. First and foremost, writing a Will does not exempt estates from probate. This process is necessary to settle outstanding debts and ensure heirs receive rightful inheritance gifts.
The only way to avoid probate is to transfer assets to a trust. With that being said, people with estates valued below $100,000 can take advantage of other strategies without the cost of setting up a trust.
Writing a Will does not reduce estate taxes. Although most estates don't owe federal taxes thanks to the 2010 Tax Relief Act, estates valued over $5 million are subjected to taxation.
A lot of people use Wills to provide directives regarding funeral services. Unless you plan on providing your chosen personal representative with a copy of the Will, including directives is a moot point.
Wills are usually read days after the burial. Instead of providing directives in the Will, make certain two or more people know of your desires and any arrangements you have made. If you own a burial plot or have purchased a cremation jar, let someone know where the documents are located.
Lastly, Wills are not used to bequeath property with assigned beneficiaries. A lot of property can avoid probate by naming people to receive property upon death. Some of the most common property includes jointly owned property, life insurance policies, pension plans, retirement accounts, financial portfolios, stocks, bonds, and money in bank accounts.
As you can see there are many considerations of establishing Wills. We provide substantial information about Wills, probate, and trusts in our estate planning article library and invite you to look around. While you're here take a moment to subscribe to our mailing list to receive weekly updates of newly published information.