If you do not have an estate plan, you can leave behind stress on your family, some big expenses and the distribution of your assets may end up going to the wrong people, according to the Daily Memphian in “Five reasons you need a will (and one reason you don’t).”
Here are five key reasons you want to leave behind an estate plan and will:
You have a family. For those who are married with children, the laws of intestacy take over, if you don’t have a will. Assets are divided between the surviving spouse and the children in most states (check with a local estate planning attorney for your state’s laws). In theory, that sounds fine. But there are three situations where not having a will can make a mess of things:
- Minors and developmentally delayed heirs. Minors and individuals with special needs may not legally contract or represent themselves in court. Therefore, they cannot agree to the disposition of assets. When a minor or individual with special needs inherits assets directly, the court must appoint a neutral person, often an attorney, to oversee that person’s best interests. It may also require the appointment of a guardian, so the court can monitor the use of the assets in the child’s best interest until they are of age.
- Bad relationships between surviving spouse and children. Under intestate law, the spouse inheriting reduces the amount the children inherit. If the spouse is a second wife, this can make a bad situation worse. A will can plan out the distribution of assets to care for the spouse and ensure that the children receive the assets, as determined by their parent.
- Extramarital children. Children who are not born to legally wed parents have the right to inherit, regardless of whether their parents were married. What if an unknown offspring shows up and demands his share? This does happen.
You don't want everything to go to your next-of-kin. Not every family is as happy as their Facebook photos. If you don’t want your lawful next of kin inheriting your assets, you need a will. Remember that as time passes and people enter and exit the family, through birth, death, marriage and divorce, the person who is your next-of-kin will likely change over time.
Do you want to give specific gifts? Under the intestacy laws, your relatives (next-of-kin) inherit your property in percentages that are based on their degree of relationship to you and the number of other relatives at that same degree. Outside of designating a beneficiary or joint owner of an assets, having a will that is properly prepared under the laws of your state, is the only way to ensure that you can determine who gets what.
You know how you want things to work after you die. If you want to have any control over what happens to your assets, how you want your funeral to be paid for, what you want to happen to personal property, etc., a will may be the best way to do this. The person named to be your executor is legally responsible to carrying out your wishes, unless it’s impossible, impractical or illegal for them to do so.
You have a living trust. If you took the trouble to have a living trust, then you should also have a will. You need, specifically, a “pour-over” will. This ensures that any assets not titled in the name of the trust at the time of your death, are transferred into the trust. Otherwise, your non-trust assets are subject to intestacy law.
The ONLY reason you may not need a will? If every single asset you own has either joint ownership or beneficiary designations. That’s very unusual, in part because it takes a lot of detail to make sure that every asset is titled correctly. You can leave real property to another person through a joint ownership deed, which establishes that person as the co-owner of the property. Accounts can be left to a person of choice, by naming a person as beneficiary.
Joint ownership and beneficiary designations do supersede the intestacy laws. However, what happens if a beneficiary dies before you do, and you neglect to change the name on the asset? There are also gift and tax implications.
We can help you create a will and complete estate plan that is appropriate for your unique circumstances. Contact our office today to schedule your consultation.
Reference: Daily Memphian (March 8, 2019) “Five reasons you need a will (and one reason you don’t)”