Guide to Wills: The Definitive Guide to Your Last Will and Testament addresses one of the most important documents for guarding wealth, providing for loved ones, and achieving other goals.
Regardless of the size of an estate, the will is a critical part of an estate plan. It guides the distribution of assets and provides for beneficiaries upon one’s death. Yet, according to surveys, only 42% of American adults have a will.
About 74% of Americans who lack a last will and testament reported that it is because they find wills and estate plans to be confusing topics. Without a will, property will be distributed according to the state law, and its priorities could be very different from yours. Therefore, it is important to have a will and ensure that you make the important decisions about how your assets are to be distributed to benefit among your loved ones and any other interests.
This article, The Definitive Guide to Your Last Will and Testament, will guide you through the features of a will, its many powers, how to prepare one, and how best to exercise a will’s powers.
Guide to Wills Section 1: What Is a Will?
Guide to Wills Section 2: Why Is a Will Necessary?
Guide to Wills Section 3: What if I Don’t Have a Will and Die Intestate?
Guide to Wills Section 4: Different Types of Wills/Which Type of Will is Right for You?
Guide to Wills Section 5: What are the Requirements of a Will?
Guide to Wills Section 6: How Do I Prepare a Will?
Guide to Wills Section 7: Who Can Help Me Prepare a Will?
Guide to Wills Section 8: Top Things to Know About Having a Will
Guide to Wills Section 9: Specific Sections to Consider Adding to Your Will
Guide to Wills Section 10: Tips to Safeguard Your Will
Guide to Wills Section 11: Final Checklist for Your Will
(For further details, click the following link: What is a Will and Why Do I need One?)
A will is a legal document in which a person, known as the testator, sets forth his or her wishes about how to distribute an estate’s assets, pay debts, care for any minor children, and handle other issues after the individual dies. Most often, the testator also appoints one or more executors to administer the estate and names guardians for minor children in a will. A will also might create one or more trusts and name the trustees.
(For further details, click the following link: 6 Reasons Why Your Will is Critical to Your Estate Plan)
A good will can reduce the expense and hassle of processing an estate. Without a will, the settlement and distribution of an estate is likely to be more expensive, prolonged, and difficult.
A few of the reasons to have a will are to:
A valid will increases the chances an estate will be processed faster, at lower cost, and in the way the deceased preferred than would happen without a will.
(For further details, click on the following link: Reasons to Avoid Dying Intestate)
When a person dies without a will, known as dying intestate, state law controls how the property in the estate will be distributed. Often, the property isn’t distributed how the deceased would have wanted. Under the intestacy laws of many states, children inherit one-third to two-thirds of the estate and the surviving spouse inherits the rest of the estate.
Dying intestate also can be more expensive than preparing a will and estate plan, because state courts and lawyers are likely to be more involved.
By drafting a will, the testator can distribute the estate how he or she wants. In addition, the testator can determine whether someone inherits property outright or through a trust. The testator also can direct that part of the estate be donated to charity. In addition, when there is no will a court appoints the executor and guardians of minor children and makes other decisions the deceased could have made in a will.
(For further details, click on the following link: What Are the Four Basic Types of Wills?)
A will can have many different features and exercise different powers. While there is one type of will that is used most often, there are other types of wills that can be used in appropriate circumstances.
The traditional last will and testament sometimes is called the testamentary will. It is a formal written will that delivers the testator’s wishes clearly. It is signed by the testator in the presence of two or more witnesses and might also be notarized. The details required to make the will valid vary from state to state.
A holographic will is one that is written and signed by the testator, but without the presence of witnesses and notarization of the signature. It usually is handwritten but doesn’t have to be formally written. Due to the relative lack of proof for the validity of the will, many states no longer accept a holographic will or only accept it under special circumstances.
An oral will involves the testator speaking his or her last wishes to one or more witnesses, and often without a written record. Many states do not accept this type of will or will accept it only in deathbed situations.
These three wills are very similar in purpose and often confused with each other. Married couples are those most likely to try to use one of these types of wills, to save either money or time. A joint will generally is regarded as a single document created by two parties, usually spouses, who leave their assets to each other. Mutual wills are two or more separate documents that are mutually binding on the parties, even when one passes first. These two types of wills cannot be changed without the consent of all parties involved.
On the other hand, reciprocal wills are two documents written by two parties, each testator naming the other as the beneficiary of the estate upon death. The surviving party can change his or her will following the other party’s death.
(For further details, click on the following link: What is a Will and Why Do I need One?)
Although there are variations between different types of wills, a will must meet several general requirements to be valid in most states.
The specifics vary from state to state, but most states require the following:
If the requirements above are not satisfied, it is easier for someone to challenge, or contest, the will’s validity. Most commonly, will contests are based on the grounds that the testator lacked testamentary capacity, was under duress or undue influence, or that the will didn’t reflect the actual intent of the testator, in entirety or in part.
(For further details, click on the following link: How to Make a Will Without A Lawyer)
In addition to knowing the foundations and general requirements of a will, it can be useful to know how to prepare a will yourself. Preparing a will without a lawyer can save a testator money and time. In 2019, 53% of people who did not have a will said the reason they didn’t was the difficulty of finding an attorney they could trust.
First and foremost, make sure you know what you own and owe. The best step is to prepare an inventory of your assets before deciding how to allocate them to heirs. Also, prepare a list of any debts, because the executor will have to pay these debts before distributing assets.
Different states accept different types of wills, but all states will accept some form of the traditional testamentary will. Therefore, you should strive to meet the requirements of a testamentary will in your state. For example, most states require two witnesses, while Vermont requires three. A will that meets all of the state’s formal requirements is harder for others to challenge.
It is best to have the will typed or computer-generated. Therefore, it will make things easier for your executor if you use a basic template or an online service — which reduces the potential the will won’t be considered valid.
A beneficiary is a person who receives property through the will, which is known as a bequest. Most often, the main goal of a will is to state how the estate should be distributed among beneficiaries, because the intended distribution is different from the way a court would distribute the estate following state law. Sometimes the will also designates that one or more specific assets will be bequeathed to one or more particular beneficiaries. After such specific bequests are made, the rest of the estate is known as the residual estate and often is distributed in percentages to beneficiaries without designating how specific assets in the residual estate are distributed.
A minor child cannot legally own the assets that are bequeathed to him or her until reaching the age of majority. Either a guardian must be appointed to handle the child’s assets or the will can create a trust in which the trustee will manage the assets until the child reaches an age named in the trust agreement
If the testator has minor children, the will should designate one or more individuals who will serve as guardians for the children if both parents are deceased. If guardian(s) are not designated, the court will choose the guardians.
The will should appoint one or more executor(s) of the estate. An executor manages the estate through the probate process and eventually distributes the estate to the beneficiaries. Since the executor manages the estate through the probate process, the choice of the executor or executors is important. Anyone can be named as executor, the only requirement is that he or she is an adult and a U.S. citizen or permanent resident.
It is often a good idea to include a letter of instructions to the executor. The letter isn’t part of the will and has no formal legal authority, but usually gives detailed information about assets, where they are located, and suggestions for how they should be managed. The letter is intended to make the executor’s job easier and answer any questions people might have about the estate or will.
Be sure to sign the will in the presence of the number of witnesses required by your state of residence. Most wills aren’t valid until it is executed, which occurs when the testator signs it in front of witnesses. Some state laws provide that only the portion of the will appearing before the signature are valid. Any writing after the signature isn’t valid. The witnesses must be adults and be disinterested, which means that they are not beneficiaries under the will.
As a last step, be sure to store the original copy of the will where it is reasonably safe and be sure that key individuals, especially the executor, know where the original and any copies are stored and they can access them. A will should also be updated periodically, especially after any major life changes of the testator or his or her family or after significant changes in the assets owned by the testator.
(For further details, click on the following link: What Your Will Can and Can’t Do)
Nowadays, it is easy to prepare a will by oneself by using an online service or typing it on a computer. However, if one has special circumstances or a complicated estate, it is best to find a lawyer or attorney to help prepare a will.
An experienced lawyer or estate planning professional can guide the testator through the complicated area and provide useful advice on estate planning strategies. Using a professional also helps mitigate risk that a will is successfully challenged in court.
(See main article: 7 Things About Wills You Must Know)
A will is critical to ensuring one’s legacy. Not only does It determine how assets are distributed to loved ones and how efficiently they are distributed, a will can reduce the expense and hassles of processing an estate. However, many people don’t know some key facts about wills and might not know how to start to prepare a will. Below are some of the most important things to know about wills.
(For further details, click on the following link: Instruction Letters and Ethical Wills)
A will can include more than descriptions of how property is to be distributed among family members.
A testator can include charitable donations in the will. Gifts or charitable donations in the will usually are through specific bequests. Charitable contributions through the estate can reduce estate taxes.
A testator also can add more personalized sections and speak directly to loved ones.
The will can include an instruction letter to your executor, as discussed earlier. This letter is a non-binding expression of wishes and instructions. It can answer questions, list the location of important documents and property, and give advice about how to handle distribution.
A will also can include a letter to loved ones, often called an ethical will. The ethical will is addressed to family members and loved ones, and it is more philosophical than the instruction letter. It is meant to share personal and family history, wisdom, and life lessons with loved ones. An ethical will is a good way to wrap up your estate plan, and make sure your children or other loved ones know what really mattered to you or what you wanted for them.
Both the instruction letter and ethical will described above are non-binding, and therefore do not contain any legal authority. Sometimes they are included in the will and sometimes they are in separate documents. However, you should know that your will is uniquely your own. It can include any sections ranging from extremely personal to strictly business.
(For further details, click on the following link: Bullet Proofing Your Will and Estate Plan from Legal Challenges)
Even with a valid and secured will, it is still possible for someone to challenge a will. In the words of Bob Carlson, editor of RetirementWatch, “Every estate plan should anticipate a contest or challenge.”
Therefore, it is best to consider adding specific measures to safeguard a will and decrease the chances that a contest against the will succeeds. Here are some steps to take as the testator:
(For further details, click on the following link: The Ultimate Will and Estate Planning Checklist and Basics Guide)
To ensure a will is complete and valid, review this checklist of questions both after the will is completed and every year or two.
Using the Guide to Wills: The Definitive Guide to Your Last Will and Testament helps a testator prepare a valid will that distributes the estate to the beneficiaries of the testator’s choice and achieves other goals.
Valuable contributions to “Guide to Wills: The Definitive Guide to Your Last Will and Testament” were made by Bob Carlson, editor of the Retirement Watch financial advisory service and chairman of the Board of Trustees of Virginia’s Fairfax County Employees’ Retirement System with more than $4 billion in assets.
Katie Kao is an editorial intern with Eagle Financial Publications.