Why You Need a Will
Having a will is one of the most important things you can do for yourself and your family. Let’s take a deeper look into why it is so important.
Why do I need a will?
A will is important because if you do not designate who will inherit your property, the state will. This statutory distribution scheme (known as “intestate distribution”) may not be in accord with your wishes and could involve significant legal costs and court involvement that can be avoided with a will. If you have property in several states, the rules in each state may be different concerning who will be entitled to your properties.
What happens if I do not have a will?
Typically, intestate law divides the decedent’s estate between the surviving spouse and living children; however, many people are surprised by the actual division made by state law. Moreover, if children are minors, the court will require a fiduciary (e.g., a guardian or trustee) to be appointed to receive and manage that property the children inherit. This can be a cumbersome, intrusive, and expensive process, requiring court supervision throughout the time the children are minors. The children’s guardian may have to justify every item paid for them, down to food and clothing.
Who takes care of my children when I die?
Perhaps most importantly, a will gives you the opportunity to designate a guardian for your minor children if the child’s other parent does not survive you. You have better understanding than a court of the relatives or friends who will best be able to care for your children – both emotionally and financially. Your will can put this designation in place, identifying the best person for each type of function.
Who is responsible for managing my estate?
A will also can simplify the probate process for your survivors. For example, you can designate a personal representative (also known as an executor) to handle your estate. You can direct how taxes and debts should be paid. You can enable your estate to take maximum advantage of estate tax savings.
Why should I plan for disability?
While estate planning is common, planning for disability is not. Why? Death is a certainty; however, few people realize just how likely a period of prolonged disability is – or the magnitude of the problems that disability causes. U.S. Census data show that approximately fifty-one million Americans, or 18% of the total population, have a disability. Thirty-three million Americans have a severe disability. Insurance statistics tell us that there is a 58% probability that a 25-year-old will become disabled for three months or longer during his lifetime. Forty-year-olds have a 45% probability, and 55-year-olds have a 23% probability. As many as 47% of Americans who are 85 and older will develop Alzheimer’s disease, a leading cause of dementia and disability among the elderly.
Why hasn’t there been more attention to planning for disability? Until recently, there hasn’t been an adequate legal solution. In the past, the only solutions were guardianship or conservatorship. The new solution is a durable power of attorney which was first introduced in Virginia in 1954. Today, all 50 states and the District of Columbia recognize general durable powers of attorney.