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Tags: finance, estate plan trusts, last will and testament
 Despite the importance of having a last will and testament in an estate plan, about seven out of ten Americans die without having written one. Even though a last will and testament is such an important document in estate planning, it is a wonder why don't more people have one? A reason perhaps has to do with our own psychology.
Unfortunately, when we make a last will and testament, we are forced to acknowledge our own mortality and we all know dealing with death is difficult. Be that as it may, you have to know that if you don't have a last will and testament, it will be much more difficult for your loved ones after you are gone.
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The importance of writing your last will and testament is paramount and you should know that. It is a document wherein you designate who will receive your assets, who will be the guardian of your children, and who will be the executor of your estate upon your death. Upon your death, the probate court rules on whether the last will and testament that you created is valid or not, using your state’s probate laws as a guide.
If it is valid, the probate court will then instruct your executor to carry out the terms of the will according to your wishes. If you don’t have a last will and testament you will increase the likelihood of conflicts and after-death disputes over your property between your children and other family members.
Without a valid will, the court will not have anything to follow, so it would have no way of knowing how to distribute your assets to your specific beneficiaries—this is called “dying intestate.” By "dying intestate," the state where you lived will step in upon your death to make the decisions for you.
They designate beneficiaries of your property according to the distribution schedule set forth in its probate laws. Thus, you will lose the ability to control the distribution of your estate. While your state's decisions were designed to pass property to those they think would most benefit from it, their decisions unfortunately, may not conform to your wishes or to what is best for the people closest to you.
This can cause a myriad of problems and misunderstanding that can result in infighting and resentment—not to mention that it could tie up your estate in the probate process for years to come. Your estate's size does not matter. If you have something to leave behind, write a will. In fact you may be surprised at the size of your estate.
Add the total value of your assets—your home, car, furniture, jewelry, savings account, and investment portfolio—less your personal debts and the bottom line is that you’ll find that you are worth more than you give yourself credit for. Even if some of your assets do not hold great monetary value, they can hold an enormous amount of sentimental value to those you will be leaving it to.
And if you own assets jointly with your spouse your share of those assets will automatically go to your surviving spouse once you die. You will not be assured of what your children receive should your spouse dies because of your spouse remarries some or all of your spouse's assets may go to his/her new spouse.
Their children may share with the spoils as well, depriving your kids what could have been a bigger share. And don’t think it’s easy to create a will anytime you want it. Probate law requires a last will and testament to have the necessary components for it to be valid, and even then it is hard to follow 100%.
An unclear clause can result in a lengthy legal battle by your family. Since you won’t know when you’ll die, the importance of a last will and testament cannot be overstated.
About the author
The author of this article Rick Goldfeller is a successful underground Financial Analyst who has been advising and coaching individuals for many years. Rick recently published a book on how to manage your money and attract Wealth and Financial Freedom. More info on his Finance Planning course is available HERE.
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