The Ultimate Exit Strategy: 4 Reasons to Execute Your Will Today
In the weeks immediately following the death of Robin Williams, his family seemed unified in grief. That illusion was shattered recently when court documents revealed the infighting over his wealth, memorabilia, and even clothing, had resulted in Mrs. Williams banning her husband’s grown children from her home. Mr. Williams’s estate planning documents did not provide enough clarity to determine what his wife and children were entitled to receive. Tempers flared and the situation quickly devolved into a contentious court case.
With methodical planning, honest conversations, and appropriate legal documents in place, this situation might have been avoided. But many Americans don’t take the time to do estate planning, much less get specific about how affairs should be handled once someone has passed away. Why?
PERCEIVED COST, PROCRASTINATION, AND UNCERTAINTY
“Many people reject estate planning because they don’t like to think about death. I mean, who does? In addition, most people assume they can’t afford it anyway and I don’t blame them. Most lawyers charge sky high hourly rates,” says Jeff Bell, CEO of LegalShield, a network of dedicated law firms that members can call for help. A $20 monthly plan membership grants clients access to lawyers for answers to legal questions including assistance with deciphering contracts or executing a will. “Everyone deserves access to the knowledge a lawyer can offer without worrying about their ability to pay. In modern terms, we ‘crowd-share’ law firms in 49 states and 4 Canadian provinces, providing affordable legal access to 3.7 million people and counting. A standard will is a benefit of our plan.”
Most middle income Americans benefit from a good standard will. Trusts are reserved for unique cases like families who wish to make provisions for a special needs child or for instances when the decedent’s assets include a business, extensive real estate or big ticket property items, or detailed instructions for trustees. The more complex the assets or numerous the heirs, the more likely a trust will better serve needs.
NO WILL OR TRUST? YOU JUST ABDICATED YOUR WISHES TO THE STATE
If you die without a will or trust in place, the state will step in to make decisions on your behalf. assets eventually.
THE “LEAVE IT TO THE STATE” ARRANGEMENT FEATURES FOUR INHERENT FLAWS. ASK YOURSELF:
1. AM I OPEN TO TEMPORARY FOSTER CARE FOR MY MINOR CHILDREN?
If parents fail to designate who should raise their children, the state will step in to make custody decisions. If no potential guardian is immediately apparent to the judge the children could be remanded to state custody (foster care) while the court investigates. A will or trust allows parents to transfer guardianship of minors to trusted friends or loved ones.
2. AM I FINE WITH THE STATE DISREGARDING MY ORAL OR WRITTEN INSTRUCTIONS?
People who designate which heirs they intend to leave specific items from their estates should know that those documents are meaningless if written outside of the context of a formal will or trust.
3. DO I FEEL KEEN TO PAY AN EXTRA PREMIUM?
It can get expensive to relinquish decision-making to the state. While wills go through probate court, estates without a will generally take longer to administer. The costs associated with extra time spent in probate court will be deducted from assets, leaving less to dispense to heirs.
4. DOES OPEN-ENDED PROBATE TIME SOUND GOOD?
Clearing the estate from probate could take a long time, dragging out dispensation to heirs for years in some cases. It is cheaper and more expedient to draw up a will that expedites the probate process. Estates protected by wills and trusts typically fly through the probate process so long as no one challenges them.