Executing a last will and testament is the only way to have the final say in how you want your affairs handled. The last will is used to designate beneficiaries, establish guardianship, express burial preferences and appoint an administrator to oversee the estate.
Drafting a last will and testament is the greatest gift you can leave your family. When people do not have a Will in place it creates a tremendous burden for those left behind. Someone will have to make burial arrangements and tie-up financial affairs. Instead of having a say-so in how your belongings will be distributed, a judge will make decisions based on probate law.
Dying intestate (without a Will) creates a horrific burden for your loved ones. Unless you have expressed your wishes verbally and informed others of where life insurance policies and legal documents are located, no one will know what you desire. If you died today, would anyone know what to do? If not, it is time to put your affairs in order.
There are many options for creating a Will. Forms can be downloaded online, filled out and notarized. Preformatted wills are sold through office supply stores, which only require filling in the blanks.
Banks, credit unions and investment brokers oftentimes offer estate planning services to their customers for a nominal fee. Estate planning can be as simple as executing a basic last will to establishing an irrevocable trust. Fees range from less than $100 to several thousand; depending on the estate value and services rendered.
Individuals who own property, valuable assets, or a business should consider setting up a trust. A trust is a container that holds the will. All assets are exempt from probate and inheritance tax.
Probate is the process used to validate decedents' wills and distribute assets to heirs. The probate process takes between six months and three years. Much depends on the complexity and value of the estate, as well as family dynamics.
Trusts are normally reserved for estates valued at $100,000 or more. Smaller estates can implement strategies to avoid probate. These can include designating beneficiaries on bank and investment accounts, life insurance policies, real estate, automobiles and other titled property.
Death has a tendency to bring out the best and worst in people. When family strife exists, probate provides a platform where disgruntled heirs can contest the will. This act rarely accomplishes anything other than bankrupting the estate by escalating legal fees.
Experts suggest retaining the services of a probate attorney or estate planner when family dysfunction exists. Family disputes are less likely to occur when a professional administers the estate.
Before appointing a probate administrator in the last will and testament, it is best to discuss the decision with the person. Estate administration duties can be difficult to manage while grieving. It is best to appoint someone who is organized, good with finances, and able to work under pressure.
Probate personal representatives are compensated for their duties. Probate law dictates how executors are paid. Some states require executors to charge an hourly rate, while others pay a flat fee or percentage of the estate value.
Establishing a Will can be accomplished in a few hours unless you are a multi-millionaire. Procrastinating can result in endless hours of estate management and prolong the probate process. Don't put off what can be done today.