Everyone that owns any titled asset(s) should have a Will so that their assets are distributed to the persons or entities as they want. A titled asset is any asset on which your name appears (car, boat, bank accounts, home and other real estate, stocks, etc.).
Without a Will, state law determines who will receive your assets after you die. Assets do not pass to the state if you do not have a Will. The assets will be distributed to your spouse and relatives in accordance with the state law rather than how you wish. Titling of assets is another important consideration, as is the use of transfer on death provisions.
CAN I WRITE MY OWN WILL?
You could, but it's not advisable because it will not be valid if not properly executed. A handwritten will that is not properly witnessed is not valid and won't have any legal effect. Please call our office to help you rest assured that your Will meets all the legal requirements and accurately states your wishes concerning who will receive your assets after you are gone. It is best to consult an attorney about preparing a Will.
I DON'T HAVE MUCH. DO I STILL NEED A WILL?
If you want your assets to pass to certain persons, then yes, you should have a Will. By making a Will, you are stating your wishes for the distribution of the assets you have. A Will also names a person or persons to serve as Personal Representative to distribute your assets according to your wishes. Without a Will, your assets will be distributed as state law mandates and the Executor appointed will also be determined by state law.
HOW IS A TRUST DIFFERENT FROM A WILL?
A trust and a Will are similar in that they both dispose of your assets on your death as you wish. You may be able to avoid probate if you create a trust and own all your property through the trust. The differences include: (1) a trust is a private document that isn't available for public inspection whereas a Will that is probated is a public document available for anyone to view; (2) a trust is effective when it has been funded and can remain in effect for many years prior to distribution and a Will is only effective upon your death; (3) assets held in a trust can be used to care for you should you become disabled without having the court to appoint a guardian and/or conservator. Should you become disabled and have only a Will, someone may need to apply to the court to become your guardian and/or conservator during your disability. This can be time-consuming and expensive.
TRUSTS - There are many different types of trusts available for different needs and scenarios. For example, if you have an adult disabled child, you cannot pass your estate directly to him or her, you will need a special needs trust. You can also set up a charitable remainder trust that takes care of you during your lifetime, then funds your favorite charity after your death. You can provide a trust fund for your grandchildren, create a life insurance trust, or create an annuity or retirement trust. The possibilities are endless, and all have tax code considerations and implications.
As with any decision, there are pros and cons to each. Please contact this office to discuss the options available and help you make an informed decision as to which would be a better choice for your situation.
WHAT IS A POWER OF ATTORNEY AND DO I NEED ONE?
A Power of Attorney is a document giving written authorization from you to another person to handle your affairs while you are alive. You may limit this authorization to only certain matters or you may limit it to be effective only upon your disability. A Power of Attorney is a necessity in an estate plan, because if something happened where you were unable to handle your affairs (write checks, pay bills, etc.), then a Power of Attorney that was signed before your incapacity will make things much easier. Without a Power of Attorney, it may be necessary for someone to go to court to be appointed your guardian and/or conservator before they could handle your affairs. A guardianship or conservatorship is an expensive and time-consuming procedure.
WHAT OTHER DOCUMENTS ARE INCLUDED IN AN ESTATE PLAN?
Other than a Will and Power of Attorney, there is also a Health-Care Directive (also known as Advance Directive, Living Will or Health-Care Power of Attorney) which is very similar to a Power of Attorney with one noted exception, it is for health related decisions only. A Health-Care Directive gives authorization to a person of your choosing to make health care decisions on your behalf based on choices you have made while competent and alert. Your Health-Care Directive can be crafted to meet your specific needs, religious beliefs, and choices.