When drafting your last will and testament, there are several important questions you will need to ask. While drafting a will can be a fairly simple process for most people, it still contains a few potentially stressful components. This article will lay out for you some of the questions you should be prepared to answer in your first appointment with your estate planning attorney.
Who gets my possessions when I die?
Of course, the most obvious question when drafting a will is who gets your possessions when you pass away. At its simplest level, this is divided in percentages between the different people you want to receive your things. We typically encourage people not to get too detailed with their precise possessions. In other words, do not name the type of car you have and say who gets it. Rather, try to figure out who should get a certain share of your total estate. The reason for this is that what you own is very likely to change before your death. If you leave a Ferrari to one of your children in your will, but you die owning a different car, there is no way to leave the Ferrari that was promised. As a result, the beneficiary loses a significant part of the inheritance that you wanted to leave for that person.
Who should care for your children and any money left for them when you pass?
While the distribution of your possessions might be the most obvious issue to consider, determining who will care for your children is certainly the most important. If you have minor children, your will is how you designate who will be their guardian in the event that you pass away. In addition, you will need to select a trustee for their funds. If you leave money behind for minor children, it will be left in trust under Pennsylvania law until they reach 21 years of age. You can alter this age in your will and include other provisions regarding the type of trust you want for them. These provisions can include requiring that they graduate college before receiving funds, that they abstain from criminal activity, or any other restrictions you wish.
The trustee is the individual who is in charge of making sure that the money is spent for their care, maintenance, and support while minors, and that it is wisely invested so that there is something left for them once they reach the designated age. A common question we get at this stage of the process is whether the guardian and the trustee can be the same person or people, and the answer is yes. You might think to put different people in these roles because someone is good at raising kids but not good with money, or vice-versa. However, selecting the same person or people for both roles is more practical as it gives those raising your children access to the funds meant for their benefit.
Who is the personal representative of your estate?
The final important consideration is selecting the personal representative of the estate. This is the executor who is charged under law with administering your estate. This person is typically paid a fee out of the estate for the work they do on your behalf, so you do not have to think of this as a burden. The executor also will hire attorneys, accountants, and other professionals to ensure that the estate is administered properly. This should be someone you trust to make sure that your wishes are carried out. Preferably, you want to select someone who is diligent, hardworking, and who can handle the details of the estate.
What about other assets?
Some assets such as your IRA, life insurance, and 401K do not pass by your will. These are considered non-probate assets, meaning that they are passed according to their beneficiary designations. If no beneficiary form is listed for such an asset, then it will pass by the will you have drafted, but this is typically something we want to avoid. Accordingly, it is important that you check the beneficiary forms for these assets to ensure that they are passing to the loved ones you intend.
Get your estate plans started today. No one likes to think about their last will and testament, and some people are even superstitious about drafting one, but there is no need for superstition or fear when it comes to wills. They are important documents which ensure that your estate passes to the correct people and that your children or other heirs are taken care of once you pass away.
We have covered only the basics in this article, but there is much more you can do with wills and other estate planning tools, including trusts and business succession plans. If you have questions about these topics, give our attorneys a call so that we can set up a time to meet with you and walk you through your estate plan.