Why You Absolutely Need a Last Will and Testament
It’s the simplest and most basic step you can take as part of the estate planning process: creating a last will and testament. So, it’s somewhat surprising that fewer than half of all Americans — just 44% — have done so.
This was the result of a Gallup poll that was conducted in 2016 shortly after the passing of the entertainer Prince, who died without a will. More recently, the Queen of Soul, Aretha Franklin, also reportedly died without a will.
Bob Marley, Kurt Cobain and Jimi Hendrix were other wealthy entertainers who didn’t prepare a last will and testament before passing away. In some of these high-profile cases, the decedents’ heirs battled in court for decades over the rights to assets in the entertainers’ estates.
Simplifying your estate settlement
You probably aren’t a famous entertainer with a multimillion-dollar estate. But this doesn’t make drafting a last will and testament less important. By creating a will detailing how your assets should be distributed, you’ll simplify the estate settlement process for your loved ones.
If you die without a will, your assets will go through the probate process. A judge will make decisions about how they are to be distributed, based on community property laws or state inheritance rules. In either case, these decisions may or may not coincide with your wishes.
Also, probate can be an expensive and time-consuming process that exposes the details of your estate to public scrutiny. The probate process can take months or even years, depending on the size and complexity of your estate. And the fees charged by attorneys and executors can diminish the amount of money your heirs ultimately receive.
Steps for drafting a will
Drafting a last will and testament is one of the best ways to avoid these consequences. And the good news is that creating a will doesn’t have to be difficult or expensive.
First, decide whether you’ll hire an attorney or create a will on your own. While online programs and software can guide you through the process, nuances can complicate a seemingly basic situation. Hiring a professional with the expertise appropriate to your needs is vital, particularly if your estate is relatively large and complex.
Next, you’ll identify your heirs and beneficiaries and name an executor for your estate. This person will be responsible for ensuring that your intentions communicated in the will are carried out. Many people choose their spouse or a close friend to serve as executor. But the duties of an executor can be complex and time-consuming, so be sure the person you designate can fulfill the executor’s duties.
If you have minor or dependent children, you’ll need to name a guardian who’ll raise them until the age of majority. Give this decision careful consideration and make sure the person or couple you choose is willing to accept the responsibility.
The final step is to assess and divide your property. List all your assets and assign a percentage of your total assets to each of your beneficiaries. Or make individual bequests of specific assets or property to heirs. Keep in mind, also, that certain assets, such as IRAs and life insurance, are designed to be transferred without regard to your will. The named beneficiary will inherit the property even if your will says otherwise. Review your beneficiary designations to make sure they reflect your wishes.
If you’re among the more than half of Americans who don’t have a last will and testament, make plans now to draft one soon. Your loved ones will be very glad you did.