Your Last Will and Testament
A Last Will and Testament is the legal document where you set out how your assets will be distributed and how your dependents will be cared for after you die. A Last Will and Testament is frequently the centerpiece of an Estate Plan.
A person who dies with a will is said to have died testate. A person who dies without a will dies intestate. It is always preferable to have a will. A will states your preference as to the disposition of your estate. A will can and should be changed as your circumstances and preferences change. Even if you take measures to avoid probate, you should have a will as a back-up. A will should always be drawn up by a qualified attorney who is familiar with your financial circumstances, family situation and your wishes for your estate.
Having a will provides a person with control over how and to whom his or her property shall be distributed after death. In a will, the decedent names an executor to collect, administer and distribute the estate. The executor may be a relative, friend or even a trust company or a bank. The executor selects a lawyer to assist in probating the will.
A will is also important not just to convey property as you desire, but for other matters. For example, you can indicate your preference for the guardianship of minor children. A will can also incorporate various tax planning techniques.
You can use your will to:
- Identify who will inherit your estate. You decide who is to get your assets and who will not get your assets. Be aware that your surviving spouse has a legal right to inherit a portion of your property. Normally, you cannot do away with this right in your will.
Specific Bequests. You can give certain items of sentimental value to certain individuals.
- Name guardians for your minor children. You will need to appoint a guardian to care for children who are younger than 18, in case both legal guardians are deceased. You also should appoint a guardian for any children who will be unable to care for themselves in adulthood. A guardian will raise your children until they reach maturity. If your children are young, consider naming alternate guardians who can step in if your primary guardian dies or becomes disabled.
- Create a trust if any minors will be inheriting your assets. This trust specifies the age at which the child will receive his or her inheritance. It also appoints a trustee to manage that inheritance until the child takes possession. These Trusts are particularly useful for Trusts for children and grandchildren.
- Choose a “Personal Representative.” The Personal Representative (sometimes called an “executor”) will manage and settle your probate estate according to your instructions. Make certain the person you choose as your Personal Representative is both willing and able to serve. It is sometimes wise to designate two Personal Representatives who can work together to settle your affairs. One Personal Representative could be an individual, like a family member or close friend. The other could be a bank or an attorney with legal and financial expertise.
Since it is not possible to see into the future, it is virtually impossible to prepare a will that provides for every possibility. You should review and update your will whenever significant changes happen in your life, or in the lives of those you have named in your will. The following life changes suggest you should review your will to see if you need to make corrections:
- Changes in persons you want to receive your property: Someone you have named in your will may die, or a new member may be added to your family through birth, adoption or marriage.
- Changes in where you live: If you move to a different state, you should have your will reviewed by a lawyer in your new state. Although laws are similar from state to state, there can be important differences in how wills should be written or will be interpreted by the courts.
- Changes in your finances: If you have a significant change in your financial circumstances, you may want to change to whom you give property or how much they should receive.
- Changes in your marital status: If you get married, divorced or become widowed, you probably need to revise your will.