One of the biggest misconceptions surrounding wills is the notion that if you have one, your family won’t have to go to court once you’re gone. Unfortunately, that is not the case; a will only deals with property that does go through court.
Let’s take a step back and look at what a will is and what probate means.
In layman’s terms, a will is a set of instructions to the probate court on how to distribute your probatable assets. However, not all assets will end up in probate.
Let’s look at an example where this would be the case: Say you pass away, and your will specifies that your two children are to inherit the house, but you have a beneficiary designation in place that names only your oldest child as the heir to the house, what happens next? Since a beneficiary designation triggers first, the house would stay out of probate and be given to your oldest child, even though your will specifies otherwise. If you did not have the beneficiary designation set up, the house would then go to probate court and your will would designate where the house goes.
If a will cannot keep your family out of court, how do you ensure your assets go where you intend while also keeping your family out of court? The simplest way to do this is to create an estate plan.
An estate plan typically includes a will, powers of attorney, trusts, and advance directives. It is a comprehensive strategy that dictates not just who will receive your money, but who can step in to take care of you, and lets you take care of the people you are leaving behind according to your intentions. Having an air-tight plan in place will give your loved ones peace of mind when you are gone.
If you have been thinking or on the fence about creating an estate plan, here are four things you should consider:
As a closing thought, when deciding if you need a will or an estate plan, keep in mind the limitations of a will. A will serves certain functions. If it is used correctly, it works great. But, if you are intending for it to do something it cannot legally do, it will not work.
Ask yourself how a will fits into your overall strategy. If what you think you need is a will or a will is all you have but you have no strategy to go with it, an estate plan may be what you are actually looking for.
Talk to one of our lawyers today by setting up a no-obligation consultation to decide what the right step is for you.