What does a will do?
A will is a legal document which details how your property should be distributed upon your death. The will also allows you to name who will be the legal guardian of your dependent children, and if you have a larger estate, it may allow you to lower estate taxes. The will has limitations, however. For instance, if you have certain assets or financial accounts the designated beneficiaries listed on those accounts may supersede the designations of a will.
Designating an Executor
At the time of your death an executor will be designated, per your will, to be in charge of your estate. The executor will be responsible for locating your assets, contacting your heirs, distributing your property, filing tax returns and processing claims from creditors. Executors should be someone you trust and who consents to the task. If you fail to name an executor, the court will appoint someone who is called the administrator. The administrator will see that the estate's property is passed through the appropriate state laws.
Who needs a will?
Although a will may be a good idea for everyone, there are some who will need a will more than others. For instance, it is highly recommended that you have a will if you have children and will need to appoint a guardian. By appointing a guardian, you can ensure that your children are cared for and raised in a way that matches your values.
Next, if you have what could be termed a "non-traditional" family or extended family, with step-siblings, cousins, or grand-nieces with whom you are extremely close and might want to give money or assets to, do not assume that this will done without a legally binding agreement. Nothing causes more dissension after a death than dividing assets while relying on the charity of grieving family members.
If you are a business owner, if you have multiple properties, or you have business partners, a will is crucial. Not only can a will allow you to avoid expensive litigation, it will also ensure your assets are distributed according to your wishes.
Finally, if you want to contribute to charity or give your money and property to anyone outside of your family you will need a will. Do not leave charitable giving up to grieving family members who will be busy planning your funeral arrangements and managing your estate. By including charitable giving in your will you can remove the stress and decision making from your family and make sure your wishes are followed.
Updating your will
Creating your will is simply the first step. It is also important that you keep your will up to date. For instance, experts recommend reviewing your will whenever you have had a major life change. This does not have to happen every year, but the will should be reviewed if you have remarried, divorced, had more children, adopted a child, acquired or lost property, bought or sold a business, retired or if one of your beneficiaries has died.
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