We’re all going to die someday.
For many folks, such a statement can be unpleasant to thing about regardless of who old they are. Regardless of a person’s thoughts or feelings on mortality, one thing that’s important for people as they get older is preparing a will.
What is a will you ask? Quite simply, it’s a legal document that states your wishes for your estate i.e. your belongings when you pass away. As the writer of the will, you the testator declare your wishes for the executor, who carries out the wishes of your will.
If you don’t have a will, it’s important to get going on one. In fact, more than 60% of the American public doesn’t have a will and more than half of Americans aged 55-64 don’t have one.
If you won’t have one yet and want to get started, you can either write a will yourself or enlist the help of legal services to get everything in order. Regardless of which way you do it, here are some important things to keep in mind when writing one:
- Choose a beneficiary: When you pass away, someone is going to end up with all of your belongings; everything from your house to smaller, sentimental things. In your will, you designate a beneficiary or beneficiary or beneficiaries, whether you choose your spouse, your children or another close relative.
- Choose an executor: As previously stated, an executor is the one who will carry out the wishes of your will. There are a few ways you can go with this. You can pick a family member and if you do, they’re traditionally compensated with a percentage of your assets. You can also choose a bank or an attorney to be the executor, which can cost you anywhere from 2-5% of your assets as compensation.
- Be specific with your intentions: One of the most important parts of writing a will is to be specific with your intentions and laying out who gets what. One of the worst things you can do for your family is to be vague and hope they will figure things out. This can easily lead to infighting and resentment.
Keep in mind that you also want to realistic with your wishes. Trying to divide assets up fairly isn’t easy and to eliminate the possibility of fights later you can talk with your heirs and try to keep a list of who gets what if certain heirs are interested in specific items.
- Get witnesses: When you’re done with your will, you need witnesses to sign it. That being said, in many cases the witnesses can’t be people who will inherit things from the will and must be at least 18. Also keep in mind that you’ll likely need at least two witnesses.
- Review your will and keep it updated: Even after you’ve put time into finishing a will, chances are good that you’ll need to update it now and then. After major purchases or major life events, you may need to update it. Keep in mind, that you’ll likely also want to establish power of attorney and possibly a living will, in case something happens and you’re left incapacitated.
If you’re of an older age, you also want to keep an eye on your assets as it relates to Medicaid planning. If you’re in need of Medicaid or are going through Medicaid planning, you want to take steps to prevent your assets being seized when you die. When it comes to Medicaid planning, you can use irrevocable trusts or Medicaid trust to use some of your assets to pay for Medicaid and still maintain the benefits of your other assets. Life estate deeds can also be used to qualify for Medicaid and Medicaid planning.
If you die without a will, your estate will be often be settled by probate and an administrator, who is bound by whatever the applicable state laws are. If this happens, your estate may end up being split up in a way you weren’t planning on. Take time to put your wishes down on paper and save your loved ones any future hang-ups.