The Importance of a Will: What It Can and Can't Do for Your Estate Plan
Creating a Will, also known as a Last Will & Testament, is a critical step for all adults over 18. However, for most people, having a Will is just one piece of a comprehensive estate plan designed to keep your loved ones out of court and conflict. Let’s explore what having a Will can—and cannot—do for your estate planning.
What A Will Does
A Will is a legal document that details your final wishes regarding the distribution of your assets to your surviving family members. Here’s what a Will allows you to do:
1. Designate Asset Distribution
A Will’s main function is to specify how you want your assets divided among your loved ones after your death. Without a Will, state law decides asset distribution, which might not align with your wishes. Keep in mind, a Will only covers assets solely owned by you. Assets with beneficiary designations or those co-owned are not included in your Will.
2. Appoint an Executor
In your Will, you can name an executor (or personal representative) who will manage your final affairs. This person will be responsible for filing your Will with the probate court, managing assets, paying off debts, filing taxes, and distributing assets to beneficiaries.
3. Name Guardians for Minor Children
If you have minor children, you can appoint legal guardians in your Will. However, relying solely on your Will for this can be risky and may leave your children vulnerable to temporary care by strangers if something happens to you. A more comprehensive approach ensures their well-being and care.
4. Back Up a Living Trust
A “pour-over” Will acts as a safety net for a living trust, transferring any assets not already in the trust into it upon your death. This ensures all your assets are managed according to your trust’s terms.
What A Will Won’t Do
While essential, a Will is just one component of a full estate plan. Here are some limitations of a Will:
1. Keep Your Family Out of Court
To transfer assets in your Will to beneficiaries, it must go through probate, a court process that can be lengthy, costly, and public. Additionally, family members can contest your Will, prolonging the process and increasing expenses.
2. Cover All Asset Types
A Will doesn’t apply to assets with a right of survivorship, designated beneficiaries, or those in a trust. These assets transfer directly to the named individuals without going through probate.
3. Provide for Pet Care
You can’t name your pet as a beneficiary in a Will. To ensure your pet’s care, create a pet trust, which allocates funds and care instructions specifically for your furry friend.
4. Fund Care for Special Needs
A Will isn’t suitable for leaving money to someone with special needs, as it can disqualify them from government benefits. Instead, establish a special needs trust to provide for their care without affecting their benefits.
5. Reduce Estate Taxes
A Will doesn’t help reduce estate taxes. To manage tax liabilities, you’ll need specific types of trusts designed for tax planning.
6. Protect Against Incapacity
A Will takes effect only after death and doesn’t help if you become incapacitated. Use a trust along with a medical power of attorney and living will to ensure your affairs are managed according to your wishes if you’re unable to do so yourself.
Get Professional Support With Your Estate Planning
While creating a Will might seem straightforward, consulting an experienced estate planning lawyer ensures it’s correctly drafted and maintained. A comprehensive estate plan involves more than just a Will; it’s about preparing for life and leaving a meaningful legacy.
At our firm, we view estate planning as more than just preparing for death and distributing assets. It's about creating a life you love and a legacy worth leaving through the choices you make today.
This article is a service of Zarda Law, S.C., We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Legacy Planning Session, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by scheduling a Legacy Planning Session and mention this article to find out how to get this $750 session at no charge.
