A Basic Will Package

Depending on the complexity of your situation and the amount of assets you have, your will and estate planning costs can range from a few hundred to thousands of dollars.  Even if you are looking to just put something simple together, you may want to consult an attorney to ensure that your wishes can not be contested in Court.  Tom says that it is extremely difficult to overturn a will that meets all of the legal requirements for that State (each State’s requirements differ slightly).  Even if you don’t have much, if you want to ensure the validity of your paperwork, you should consider investing in getting sound legal advice.

Note: Because, you must declare a beneficiary when you start a retirement plan or purchase a life insurance policy, these are the only assets that are exempt from court intervention if you don’t have a will in place.  However, if you do write your will, to avoid major problems down the line, make sure that your beneficiaries listed on your policies have not changed, and they are the same people who you list in your will to inherit those assets.

In addition to the actual Will, all basic packages should include:

1. Assignment of Power of Attorney (the authorization to act on someone else’s behalf in a legal or business matter in the case you are unable to do so).

2.  Health Care Proxy (a document appointing an agent to make health care decisions on your behalf in the event that you are incapable of executing such decisions- If you don’t have this, the court decides!)

3.  Living Will (your written instructions specifying what actions should be taken for your health in the event that they are no longer able to make decisions due to illness or incapacity.  Major example: Your wishes regarding life support).

4.  Will (a legal declaration by which you, the testator, names one or more persons to manage your estate -the executor- and provide for the transfer of your property at death to the people of your choice. If you do not feel that you need to speak with an attorney, there are several online services like Legal Zoom that can inexpensively help you put together a simple will that meets the standard requirements of your State.  In addition, Quicken Willmaker is an easy to use software that is updated annually to help you put your basic estate planning needs in order.

Estate Planning

The more means you have, the more intricate this part of the process becomes.  Estate planning is ALL about TAXES and avoiding paying them multiple times.  We all have heard of trust funds or trusts, well – they are actually estate tax structures.  The federal & state laws & taxes regarding Estate or ‘Death Tax’, get crazy complicated and change often.

If your assets (including your house) total more than the exemption amount ($1 million in 2011), you may want to consider investing in an estate planner.  It is extremely important to get proper legal and accounting advice when you embark down this path.  The details are endless!   For example: You can actually leave too much to your spouse, subjecting them to unnecessary tax penalties…

The Evolution of Your Will

As your family and wealth hopefully expand over time, and your needs change, it is important to continually fine tune your will.

Will You Or Won’t You?

We hope this discussion of the unthinkable has, well….made you think.  It seems that wills are important for everyone to have – not just those with children or with gazillions of dollars.  We know this is a topic that can seem overwhelming, but as with so many parts of our financial lives, a little legwork now can be a lifesaver (no pun intended) later!

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