Wills: When to use and when not to....

Everyone 18 years and older should have a Will. However, Wills are more important for some people than others depending on their circumstances. For instance: persons with minor children always need a Will to name guardians. If you do not provide guardianship in your Will the probate court decides for you: a lengthy and very expensive process that does not guarantee the persons you want will be watching over your children. Personal property (such as jewelry, furniture, art, collectables) is sometimes distributed via a Will (although this is better done through a proper trust). Vehicles are often transferred via a Will at the Department of Motor Vehicles.

Wills can also help with accounts that were found after a person passes away. In this situation the money goes to the deceased "estate" which is controlled by the language in the Will (executor and heirs). Every state has a limit for these monies as to whether a formal probate is required (court appearances) or if a small estate affidavit can be used (a simplified way of settling an estate often without the need for a formal probate). As you can see, everyone should have a Will - however, sometimes other types of plans (trusts) can provide better control and protection vs. a Will.

Property You Can’t Leave by Will

A will usually doesn’t affect certain kinds of property that you’ve legally bound yourself to transfer by other means, including:

• Property held in joint tenancy, which will automatically belong to the surviving joint tenants at your death. A will provision leaving joint tenancy property would have no effect unless all joint tenants died simultaneously.

• Property you’ve transferred to a living trust.

• Proceeds of a life insurance policy where you’ve already named a beneficiary for the policy.

• Money in a pension plan or in an individual retirement account such as an IRA, 401(k), or profit-sharing plan, or any other retirement plan for which you’ve named a beneficiary.

• Money in a pay-on-death bank account or stocks held in a transfer-on-death account, for which you have named a beneficiary to receive whatever is in the account when you die.

• Property specifically controlled by a contract. For example, if you are a partner in small business, the partnership agreement (a contract) may limit your ability to dispose of your interest in the business by will.

• Digital assets: These typically are not owned and only licensed and cannot be transferred by a Will.

• Gifts to Pets: These are invalid and can only be done through a properly drafted Trust.

• Funeral and Burial instructions: These typically occur prior to the Will being enforced making the useless or not legally binding.

Illegal or Unenforceable Will Provisions

There are also a few legal limitations on what you can do in a will. You cannot:

• Encourage or attempt to restrain certain types of conduct of your beneficiaries.

  For example, you cannot leave a gift contingent on the marriage, divorce or change of religion of a recipient. You can, however, make a gift contingent on other behavior -- for example: a gift to John, if and when he goes to college. Why this distinction? Because courts say that public policy prohibits attempts to coerce fundamental rights like the choice of spouse or religion. But it’s allowable to try to control lesser matters, like going to school. However, you cannot use this book to impose controls over your beneficiaries or property, except leaving property in a trust for children. Making contingent gifts almost always opens a can of worms -- for instance, who will enforce the will’s conditions, and for how long? A Trust from CompleteMyEstatePlan.com can solve this issue.

• Leave money for an illegal purpose, such as encouraging minors to smoke tobacco.

• Leave property to felons convicted of certain crimes. (although these rules vary from state to state).

  
  

Contact CompleteMyEstatePlan.com today & we can help answer questions and guide you through the online will process!