A 48-year-old client once told me the best thing she could give her children for Christmas would be a well-prepared Will. She was relatively young, but she was right. She unexpectedly died two years later.
Wills are not do-it-yourself, quickie downloads from the Internet. Regardless of the size of your holdings and to avoid lengthy court time or withstand challenges before they arise, a Will, like a trust, power of attorney, medical proxy and other such documents, should be properly prepared by an attorney who specializes in and knows the legal landscape of estate planning.
While no one plans to die, or to die young, it can and eventually will happen to all of us. A well drawn Will can save your loved ones time and additional anguish when they are least able to face such burdens. In fact, it is selfish not to have a Will.
Conversely, if you die without a Will the process is time-consuming and expensive to administer your estate, regardless of its size. Your third cousin twice removed whom you rarely saw and didn’t much like may inherit possessions you wanted your best friends to have.
Here are eight good reasons you need a Will.
- If you die without a Will (dying intestate), state law dictates who inherits your assets, which includes everything you own. In your Will you decide who inherits what. Contrary to popular belief, under Georgia law, a spouse is not the primary beneficiary if you have children and die intestate.
- With a Will you decide – not the court — who manages your estate. This includes organizing your assets, paying your debts, and distributing the remaining assets as you direct in your Will. Until your estate is finalized, bills still must be paid and any income must be deposited. If the court manages this, your estate will pay fees, draining your holdings sometimes to nothing.
- If you are not married to your child(ren)’s other parent, a Will prevents that person from seizing financial control of your child(ren)’s inheritance from your accounts. Yes, a court may send the child(ren) to the other parent, but a Will protects your assets as you want.
If you are married, the Will should name a person or persons you select as guardian(s) to care for your children until they are adults. The guardian takes care of your child(ren) much as you would, using your financial assets as you stipulate in your Will or a Trust.
Your child(ren) may inherit part or all of your estate, particularly if you are a single parent. However, under Georgia law you can only give a minor $5,000. If your child(ren) are to inherit more than that, you should establish a free-standing trust, or include a trust in your Will to prevent the probate court from controlling your child’s money. This ensures the child(ren)’s money will be managed and disbursed as you have directed.
Life insurance benefits also should be payable to such a trust. Your retirement accounts should go to a standalone retirement trust. The trustee you choose manages and distributes these funds to provide for your child(ren)’s support until they reach the age of inheritance you state in the document.
This is important and bears repeating: your failure to leave your children’s inheritance in a Will or a Trust could result in the court taking over management of your funds and draining your accounts for management fees to some court-appointed conservator with no concern for your wishes, family or friends.
- You can use your Will to disinherit those who would otherwise inherit under state law if you die intestate. Georgia law doesn’t require that you leave anything to your spouse or children. However, it’s essential that you provide their names and relationships so they can’t contest the document and claim you “forgot” them.
- If you have a taxable estate, a Will provides you with the opportunity to minimize or, in some cases, eliminate estate taxes.
- You may make gifts or donations to organizations and charities as you desire in a Will. Lacking a Will, the court decides who gets what. That generally excludes the organizations you care about.
- If you are a single person without children you may want your estate items and assets to go to close friends and charities. However, lacking a Will, the court likely will choose extended family members or very distant cousins.
- You always can update your Will if you change your mind about anything it contains. This is easily done in a subsequent legal document known as a codicil.