IN THE OCTOBER/NOVEMBER 2019 ISSUE OF SISTAH’S PLACE MAGAZINE, I BEGIN A REVIEW OF THE ESSENTIAL ESTATE PLANNING DOCUMENTS BY DISCUSSING THE BASICS OF A LAST WILL AND TESTAMENT.
SISTAH’S PLACE MAGAZINE CELEBRATES WOMEN HAVING AN IMPACT THROUGH ENTERTAINMENT, INSPIRATION, AND EMPOWERMENT. GET YOUR COPY HERE.
Why do I need a Will?
No one wants to intentionally cause their loved ones’ stress or add chaos to their lives, however, that is exactly what happens when a person dies without a Will. A Will gives the ability to bring a sense of peace through the changes that accompany death with a little preparation and forethought. Yet, the number one question that I receive is, “Why do I need a Will?” The overall reasons are, A Will allows you to decide upon your death: 1) Who will care for your minor child or disabled adult child?; 2) Who gets your money?; 3) Who gets your property (things)?; and 4) Who will make sure your money and things are distributed the way you desire?.
When a person dies with a Will it is considered Testate. Meaning this person created a valid custom plan based on their decisions prior to their death. Creating a Will consists of five major parts. The first is naming an Executor. This is the person appointed to carry out the terms of the Will. The second is naming a Guardian of a minor child or disabled child. A guardian should be someone who possesses the values, personality traits, and lifestyle elements that are the most important to you when it comes to raising your child. This is the person who cares for the child’s daily needs and manages and safeguards the child’s property and money. Third, is writing down a full inventory consisting of: money (i.e. checking, savings, investments, etc.), property (i.e. real estate, household goods, jewelry, etc.) and debts (i.e. mortgage, car payments, student loans, etc.). This allows a person to clearly see their assets and liabilities and thereby adequately plan how to pay off their debts and have money and property remaining to gift. It also allows a person to decide, without limits, who should receive the gifts and what money or property the gifts should consist of. It is through these gifts that the beneficiary can begin to obtain a measure of financial stability and a legacy of generational wealth can begin. Fourth, a person can give detailed instructions on donating their organs, their funeral, and burial, or cremation and scattering of their cremains. Fifth, with a Will a person has the ability to reduce the cost of Probate (the court proceedings to administer a person’s will) by limiting the court’s involvement and oversight by directing independent administration by the executor and by waiving the requirement of a Surety Bond (a financial obligation of two times the value of the deceased person’s property and money).
In order to be a valid Will, there are formalities that must be followed. A Will must be: 1) in writing, 2) the creator must be a person of sound mind, 3) there must be no undue influence, 4) the Will must be signed and dated, and 5) in the presence of two disinterested witnesses who are age 18 or older.
The number two question that I receive is, “What happens if I don’t have a Will?” The surprising answer is, “Everyone has a death plan. It just may not be the plan that you want.” When a person dies without a Will it is called intestate. Unlike when a person dies testate and makes a custom plan, each state has enacted statutes called, Intestacy Laws, that will provide for the management and distribution of a person’s property and money upon death. For example, Illinois intestacy laws direct any outstanding debt and/or taxes of the deceased person are paid prior to making any distributions. Its plan of distribution begins with (a) If there is a surviving spouse and children: 1/2 of the entire estate will go to the surviving spouse and 1/2 equally divided among the deceased person’s children. (b) If there is no surviving spouse but children: the entire estate is equally divided among the surviving children. (c) If there is a surviving spouse but no surviving children: the entire estate goes to the surviving spouse. (d) If there is no surviving spouse or surviving children but a parent, brother, sister, or child of a brother or sister of the deceased person: the entire estate goes to the parents, brothers, and sisters in equal parts, allowing the surviving parent if one is dead a double portion… And so on. Note, that the state’s plan does not allow for distribution to a long-time partner, non-biological child, a friend, or organization. Further, any interested person may petition the court to be the Administrator. This is the person appointed to manage and distribute the property. It also requires Probate with complete court involvement and oversite and the surety bond.
So, the question is what do you want the change to look like at your death?
