Financial Planning

We often think of August as the “dog days of summer,” but did you know it’s National Make A Will Month? While I didn’t, I can understand why a month has been dedicated to raise awareness about making a will. A will is the most important document in an estate plan because it’s the primary document to provide for loved ones when we pass away.

Regardless of personal and financial situations, we need to think about what we own and who we want to leave our belongings to in order to have the final say as to how and to whom our property and assets passes. The alternative, should you not have a will, is called “intestacy” which means state law determines how and who our estates will be passed on to. Most are not comfortable leaving this responsibility to the state and would rather self-determine what happens to our own property.

Before making a will, there are a few considerations to think about (even write down) before engaging with an attorney.

1. Appointing an Executor/Executrix. This person is responsible for managing your estate and carrying out your intentions as they are expressed in the will and working with the probate court while they are administering the estate. Specifically, a trusted fiduciary who will be responsible for paying debts, expenses, and taxes, if applicable, and more importantly, for marshaling assets and distributing them to family, heirs, and/or charity according to the will. Finally, think about appointing a successor in case the original person appointed is unable to act as Executor/Executrix.
2. Appointing a Legal Guardian for minor children. If there are minor children involved, this individual(s) would be responsible for caring for minor children until they become adults. Guardians can be appointed to manage a minor’s financial affairs in addition to caring for them.
3. Think about what you own and who it will go to. Take an inventory of real and personal property, intangible property, such as bank accounts and investments, and digital assets. Retirement accounts will be passed on by beneficiary designation (outside of the will) and should be coordinated with your estate plan. Choose the people who will inherit the property and assets you have inventoried. For most it will likely be spouses, partners, family, friends, and heirs who will be named in a will.

After a will is created it should be reviewed every 4 to 5 years (with or without the help of an attorney) to account for any changes that may have taken place since the will was signed and to ensure it will still accomplish your estate planning goals.

When making a will, it is also a good time to create a financial power of attorney, healthcare power of attorney, and living will. These documents, commonly known as advanced directives, address situations that may arise during our lifetimes when a person is unable to act on their own behalf to manage their financial affairs or to make important healthcare decisions if incapacitated.

Creating a will is an important first step in an estate plan. Thinking about the considerations listed above before meeting with an attorney should help make the process easier and perhaps more cost-effective. Once a will is created and signed, you can have peace of mind with a plan in place.

Download our Estate Planning Guidebook, which includes planning recommendations at a variety of life stages and a checklist to help you prepare to meet with your estate attorney.

Consult with an attorney or a tax or financial advisor regarding your specific legal, tax, estate planning, or financial situation. The information in this article is not intended as legal or tax advice.