PARENTS & HOMEOWNERS: MY 7-STEP ESTATE PLANNING PROCESS WILL PROTECT YOUR HEIRS
From Creditors, Predators & Bad Choices, And Will Help You Become a (Bigger) Hero to Your Family!
10 Things That Happen When You Die Without A Will And Trust
Why You Should Have A Will
58% of Americans currently do not have a will.
For those with children under the age of 18, the numbers are even worse — only 36% of their parents and guardians have a will, meaning a full 64% of people who are taking care of minor children have no end-of-life plans in place.
You’re a GREAT Parent. Why Would You Leave Your Kids Stranded?
You wouldn’t leave your kids alone in the park; why are you taking the risk of leaving them alone with no money or guidance for their entire childhood?
Americans are failing – abjectly – when it comes to estate planning.
Why? Because we don’t want to think about our own mortality. Also, it can be hard to worry about what will happen to our assets after we’re gone since we won’t be around to see it.
Dying intestate (without a will or trust in place) has some pretty serious consequences, even though you won’t be the one experiencing them. Here’s the unadulterated truth about what happens if you don’t have a will in place when you die. Warning: This sucks. You need to talk to an estate planning attorney right now.
The Government Will Make Decisions About Your Minor Children
If, God forbid, both you and your spouse are in a terrible accident, who decides what happens to the kids? Do you want the craziest relative of yours in charge of raising your kids? I sure don’t. Don’t let the Government decide how to raise your kids. Just Say No.
For most two-parent households, it’s easy to assume that there will always be one parent around even if illness, accident, or bad luck strikes the other. But what if you are a single parent, a divorced parent, or a parent in a blended family? Or what if something should happen to both you and your spouse at once? In that case, dying without a will would mean your state government will be making choices about your children’s health, schooling, religion, and moral guidance, rather than you.
Even though the odds are strongly in favor of both you and your spouse living to see your kids reach adulthood, having a will in place can offer you peace of mind. It allows you to decide who will take care of your kids, rather than leaving it up to others to decide.
Your Property Will Go To Your Next-of-Kin
Your closest living relative is your crazy sister. You’ve never been close to her, she’s a deadbeat, mildly crazy, been nothing but destructive to you and the family for your entire life.
If you die without a will, she will inherit everything, even if you want your assets to go to your children.
The state assigns inheritance based on degree of familial relationship, since there is no other fair way of determining what you would have wanted. So even though you swore you’d never speak to your sister again, she will still be your sole heir if you die intestate.
This is a particularly tough problem for unmarried life partners. Without either a will or the legal status conferred by marriage, the death of one member of such a couple can be devastating to the surviving partner. Such survivors can lose out on everything from financial assets their partner intended them to have, to the very roof over their heads if the house they shared is part of the decedent’s estate.
Even uncoupled individuals need to worry about this aspect of dying without a will. A never-married individual with no children may wish to leave all their worldly goods to a favorite charity. But without a will, the estate will go to your nearest relative, who might be someone you have never met. Better to have a will in place and know that your money will enrich the charitable institutions you care about, rather than have an estranged relative be glad you’re dead.
An executor will be assigned to your estate
After you pass away, someone needs to be in charge of the logistical details of your estate. That position is known as “executor,” and their duties include:
- Managing your assets until they can be distributed to your heirs.
- Terminating your accounts and credit cards.
- Notifying banks and government agencies of your death.
- Paying debts.
- Paying continuing expenses with estate funds.
- Paying your final income taxes.
- Supervising the distribution of your property.
When you write your will, you get to choose who will serve as executor to your estate. This is an important decision, since your executor will need to be trustworthy, will need to know you well enough to know where to find your important documents, and will need to be able to handle the sometimes considerable time commitment necessary to carry out all of the duties associated with the job.
Without a will in place, however, the court will appoint someone to the position of executor. While the court will generally appoint a surviving spouse or another family member as executor, this can potentially be disastrous if the court-chosen executor is unable to handle the responsibility.
Probate may take longer
Probate is the legal process of determining the deceased’s assets and liabilities and transferring title of those assets to the legal heirs. All estates over a certain dollar threshold must go through probate, but having a will in place can help speed up the process somewhat since it will take less work to identify and assess the deceased’s property when it’s already been specified in the will.
There are several reasons why you might want to spare your heirs a prolonged probate process. To start, the cost of probate can be expensive. While small estates can avoid probate — and the definition of small depends on which state you live in — estates over a minimum dollar threshold will have to go through the process, and the cost of probate will be taken from the estate. This means dying without a will can cost your heirs.
In addition, probate procedures are all public record, meaning anyone can learn more about your estate than you might want them to know.
Finally, the process of probate can be incredibly frustrating. Just ask the siblings of legendary musician Prince, who died without a will in April 2016. More than a year after his death, the court is still trying to determine the specifics of the musician’s $200 million estate, including everything from who is a legitimate heir to who owns Prince’s back catalog of music.
Your Way, or the Court’s Way?
Without a will and trust, your assets will be distributed after your death, whether or not you write a will. But without a will in place, it will be the courts deciding who gets guardianship of your children, who gets your assets, and who will take care of the logistics of your estate. Rather than put your loved ones through a difficult process that doesn’t reflect your choices, take the time to write a will, and keep it updated throughout your life. Your family will be glad you did.