Getting married and starting a family can change your financial picture in substantial ways. One of the most essential tools you may need to protect your loved ones in that scenario is a last will and testament.
Last Will and Testament
The primary function of a will is to outline your wishes with regard to who will inherit your assets when you pass away. That can include things like a home you own, investment and bank accounts or your car. You can also use a will to pass on any assets that have more sentimental than financial value, such as collectibles, clothing or other personal effects. You wouldn’t, however, include any financial assets that already have a designated beneficiary in your will, such as:
• Life insurance policies
• Individual retirement accounts
• Employer-sponsored retirement plans
• Bank accounts
• Other investment accounts
Having a will ensures that your wishes are honored with regard to how you want your assets divided. If you die without a will, you’re deemed intestate. When that happens, all of your assets are divided up according to the inheritance laws outlined in your state. If you’re married, your spouse and children would typically get first rights to your estate but when you’re single, your primary heirs would normally include your parents, siblings and other family members. If you’re young and healthy, the thought of something happening to you may have never crossed your mind. And if you’re older and still single, you may not feel the need to get a will until you’re married or have kids in the picture.
So, who is a will right for? You may need a will when you’re single if:
• You have a positive net worth
• You own a home or have other assets that would need to be distributed if you die
• You’re worried about who would end up with your assets once you pass away
• You want to use your will to make financial gifts to individuals or charitable donations
• You want to leave specific instructions about how your pets should be cared for
There are two ways to make a will when you’re single: you can either do it yourself online or ask an estate planning attorney for help. The DIY route may be more appealing if you have a relatively simple estate and you want to avoid high legal fees. On the other hand, if you’ve accumulated a decent amount of assets because you own several rental properties or the markets been good to your portfolio, then it may be better to have an experienced professional on-board. You could hand-write your will but those aren’t recognized as legal in every state. The better, and safer, the option is to have a computer-generated document outlining your wishes that you can have notarized and filed with the probate court in your state if that’s required to make it official.
As you write your will, remember:
• You’ll need to name an executor. After your death, this person is responsible for inventorying your assets, notifying your creditors and paying any outstanding debts and distributing your assets to your heirs.
• You may need witnesses. Probate law varies from state to state and many states require your will to be witnessed by at least two people. Generally, your witnesses must be legal adults and of sound mind. Some states prohibit anyone who has a financial interest in the will from being a witness. The same goes for your executor.
• You’ll need a plan for how you want your assets to be distributed. This part of the will-writing process is what requires the most thought. While you can change a will after it’s finalized, that can be problematic if one of your heirs contests the original will after you’ve passed away. Before you commit your wishes to paper, take time to think carefully about what assets you want to include and who you want them to go to.
• Your should change as your life situation changes. If your single status changes because you’ve gotten married, you become a parent or you acquire new assets, remember that your will should reflect those changes. It’s a good idea to review your will at least once per year to ensure that it still’s a good fit for your financial situation.
Most single people should have a will. A will can help you determine who will get your property (including your home, business, pets, and digital assets), name guardians for your children, and name an executor. A will also puts your wishes in writing so there’s no confusion about your intentions. If you don’t have a will, your state’s intestate succession laws will determine who gets your property. In most states, this means that if you don’t have a will, your property will go to your closest relatives. For single people, recipients are usually parents, children, or siblings. If none of those people are alive to take your property, it will go to more distant relatives, like cousins, aunts, and uncles. Under these rules, your friends, significant others, and other relatives (like step-siblings) will get nothing. To avoid the default rules of intestate succession, make a will. Under a will, you decide who gets what and the default rules do not apply.
In your will, you name the people you want to receive your property and what specific property you want them to receive. For many people who own a home, it is the most valuable thing they have. If you’re single, you certainly want to decide for yourself who should get it if you die. This may be especially true if you co-own your home with a partner and want your partner to own the entire home after you die. Things could get messy if intestate succession makes your parents or children half-owners of the house instead. You can use a will to make it clear who should get your portion. However, depending on how you and the co-owner hold the property, a will may not change who gets the property when you die. If you hold the property in joint tenancy, the co-owner will automatically become the full owner after you die, and you cannot use your will to give your portion to anyone else.
If you have a business, a will can transfer your interest in it if you don’t have an agreement with other owners of the business. Work with an attorney if you want to make an exit strategy for your business, have multiple partners, or want to transfer the business to your child at your death. A lawyer will be familiar with your state laws on transferring business interests and can help minimize estate and income tax consequences. If you own digital assets, you may be able to pass some of these assets through your will. Examples of digital assets that may pass through your will include:
• libraries of digital music, video, or photos
• digital content (like the content of your blog , but probably not the blog itself)
• the content of files on your phone or computer
• self-published books
• loyalty points and airline miles, and
• your seller’s assets in an online store.
It’s very important that you leave your executor instructions about how to access these assets. This is usually best done in a separate letter to your executor. You might also use that letter to leave instructions for digital assets that you cannot leave through your will (because you do not own them)—for example, email accounts, social media accounts, online memberships, subscription accounts, and apps on your phone or tablet.
Separate from determining who gets your property, you can use your will to nominate a guardian for your children. A guardian is a person who will raise your children and manage their property if you die while they’re still minors. You can make the same person responsible for the custody side and the financial side, or you can name a separate guardian to manage the finances. In your will, you can let the court know your wishes.
The guardian you name won’t automatically take custody; the court will schedule a hearing and determine who should be the guardian. (And if your child has another legal parent, that person will almost always be named as the custodial parent.) But, the court will take your stated preferences seriously. Get help from an attorney if you are concerned about this. Having a will can help avoid confusion because your wishes are in black and white. If your loved ones don’t get along and you don’t have a will, they might fight over what they think you would have wanted. If you have a will, your wishes are in writing for your loved ones to see. If you’re concerned about your loved ones still fighting even if you have a will, learn about how you can avoid a challenge to your will and get help from an attorney. Many people wonder if they really need a will. They may think that they don’t have enough assets to bother with a will. Some people erroneously believe that a will causes your heirs to have to go through probate, leading to unnecessary expenses. However, a will is a good idea for just about everyone. Another misconception about having a will is the idea that having a will causes your heirs to have to go through probate, and that it will be difficult and expensive. If you die without a will, the probate court is still going to oversee the distribution of your assets to your heirs. There is absolutely no reason to think that this process is made easier or less expensive by your not having a will.
In fact, it will probably be more expensive. For one thing, whoever administers your estate will probably have to post a surety bond if you don’t have a will. If you do have a will, not only can you choose the person who will administer your estate, you can provide that he or she will not have to post a surety bond. Your will tells everyone what should happen to your money, possessions and property after you die (all these things together are called your ‘estate’). If you don’t leave a will, the law decides how your estate is passed on – and this might not be in line with your wishes.
Reasons why you need a will
• A will makes it much easier for your family or friends to sort everything out when you die, without a will the process can be more time consuming and stressful.
• If you don’t write a will, everything you own will be shared out in a standard way defined by the law – which isn’t always the way you might want.
• A will can help reduce the amount of Inheritance Tax that might be payable on the value of the property and money you leave behind.
• Writing a will is especially important if you have children or other family who depend on you financially, or if you want to leave something to people outside your immediate family.
Your will doesn’t have to be on special paper or use a lot of legal language. A document is a valid will as long as it:
• Says how your estate should be shared out when you die.
• Was made when you were able to make your own decisions and you weren’t put under pressure about who to leave things to.
• Is signed and dated by you in the presence of two adult, independent witnesses, and then signed by the two witnesses in your presence – the witnesses can’t be people who are going to inherit anything from you (or their husband/wife or civil partner.
How to start making a will
Make a plan: Start by thinking about what you want to leave to whom and then talk to your family – they might have some suggestions you haven’t thought of. Once you have a plan look at the different options for making a will.
• Talking to your family about your will
• Planning what to leave in your will
Get your will written: There are a number of ways you can get a will written. The best option for you depends on how complicated your wishes are:
• a simple will
• a complex will. It may be more complex as you have been divorced and have children
• a specialist will – that involves trusts or oversea properties,
• you can buy a template document in stationery shops
If you are married, then you need a will because your spouse is someone who is so closely tied to you that it’s important for you to put in writing whether she or he gets your assets upon your death. Traditionally, your spouse would likely inherit your things even if you die without a will, but you shouldn’t leave that up to chance. Additionally, if you want anyone other than your spouse to receive any of your assets, you would need to include that in your will because that isn’t the default. If you have kids, you need a will because your kids are likely to inherit your things if you die intestate, after your spouse, but not necessarily. This means that if you want your kids to inherit after your spouse, then you need to put that in writing so there is no room for error or interpretation by the courts. Additionally, if you don’t want one of (or all of) your kids to inherit, then that needs to be in writing. Whether you want your kids to inherit your assets or not, it is likely that you have feelings about it one way or another. For this reason, it’s very important that you have a will in place so that the decision is being made by you, not the state.
• A will is a legal document that dictates the distribution of assets when you die. If you die without a will, state law governs.
• You definitely need a will if you are married, have kids, or have a lot of assets.
• You may not need a will if you are young, single, childless, and broke.
• When it is time for you to get a will in place, make sure you hire an estate attorney to draft it for you. A will can help your family avoid conflict when you die, and it is not something you should draft yourself.
Free Initial Consultation with Lawyer
It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506