Will Power

It’s time for a little change of pace when it comes to my subject matter. This blog won’t be about money[i]. It can be a bit grueling to try to write something readable about a taboo topic that people aren’t comfortable discussing such as money. Instead of trying to do that, I figured I’d write about something even more universal, death.

There are a few things everyone should know about what happens to your things when you die. I’m not a lawyer, or a cop, but I know my rights and yours.

1. You have the right to remain unprepared.

2. Anything you don’t put in writing may be distributed according to state law, not your wishes.

3. You have the right to name beneficiaries, guardians, and decision-makers who reflect your values. If you fail to do so, the State will gladly improvise.

4. You have the right to create an estate plan. If you choose not to, your family may wish you had.

In my opinion there are two fundamental aspects of estate planning that everyone should know but many don’t:

1. If you don’t have a valid will your estate still goes through probate but without following your wishes.

2. If you can put a beneficiary on something, do it[ii]

"Where there's a will, there's a way" but without one there’s intestate succession. We’re all going to die[iii], if you don’t have an estate plan, the government has one for you. Each state has intestate succession laws which dictate what happens to your assets[iv] if you were to die without a valid will. Sometimes people wish to avoid probate and there are ways to do so with proper planning[v] but what many people may not realize is that without a will[vi] your estate will still go through probate based on the intestate succession laws.  

Beneficiary designations supersede wills and trusts. If you want something to go directly to a natural person who is an adult without special needs, beneficiary designations tend to be the easiest way to go. It is incredibly important to make sure beneficiaries are up to date.  For example: your will could say your new spouse gets everything but if you failed to remove an ex as beneficiary your ex will get that account. Accounts with beneficiaries tend to be distributed first while the process of probate or administering a trust is typically more drawn out. The good news is that it is often easier to update a beneficiary on an account than updating your legal documents. 

Why wouldn’t you just name beneficiaries on accounts? 

Beneficiaries get unrestricted access to the funds and there could be reasons you don’t want that. For example, a simple beneficiary designation could be problematic in cases with minors, spendthrifts, addiction, special needs, or concerns about creditors or assets becoming marital property.

The key takeaways are that probate doesn’t get avoided if you do nothing to plan but designating beneficiaries and keeping them updated can avoid a lot of probate.

Do you understand these rights as I’ve explained them to you? With these rights in mind, are you ready to take control of your legacy?