When you think of estate planning, a Will is usually the first thing that comes to mind. In fact, most people who contact us tell us they do not need anything complicated for their estate – just a Will. Indeed, Wills have a reputation as the number one estate planning tool and can be seen all over TV shows and movies, from the dramatic “reading of the Will” (which rarely happens in real life) to characters plotting how best to defraud their billionaire uncle in order to inherit his lavish estate.
Although Wills are a key part of your estate plan – and a big part of the movies – relying on a Will alone likely will not solve your estate planning needs – no matter what Hollywood says. Instead, using just a Will to plan your final wishes is likely to leave your loved ones with an expensive mess that will not distribute your assets in the way you intended.
What’s more, a Will alone will not ensure that you are taken care of in the event of incapacity, and contrary to what you might think, relying on only a Will actually guarantees that your family will need to go to court when you die.
If you do not want to leave your family with a mess if something happens to you, it’s important to know how a Will works and when it can be used to benefit you and your family.
What Exactly Is a Will and How Does it Work?
A Will is a written document that directs how the creator of the Will wants their possessions disposed of after their death. The creator of the Will is called the testator or testatrix. In your Will, you can name someone you trust to manage the distribution of your assets, called your personal representative or executor. You can also write out what you want to have happen to your property, what charitable gifts you want to make, and who will receive them.
A Will can be a complex document or a very simple document. With that said, a Will is not a legally binding document unless it is executed according to the laws of the state where you reside. In Florida, you must sign your will in the presence of at least two witnesses.
A Will Requires Probate Court
One of the biggest estate planning myths we hear from clients is the belief that by having a Will, their loved ones will not need to go to court after they die. Unfortunately, that is incorrect.
If you use only a Will as your main method of estate planning, you are actually guaranteeing that your loved ones will go to court after you die because a Will is required by law to go through the court system called “probate” before any of your assets can be distributed. In fact, a will is only effective within the probate court.
Once your Will is admitted to the court after your death, your personal representative or executor will be given official authority to move your assets under the court’s supervision. This ensures your property is distributed according to your wishes and that the court can intervene if there are any disputes over who gets what.
While court oversight can be helpful if there is any confusion or disagreement about your estate, the probate process is long and expensive. For very small estates the process may take about 6 months, but for most estates, the process can take 9-18 months, or sometimes even more.
Due to the length and complexity of the process, going through probate can be very expensive for your family. Some states even require that probate cost a certain percentage of your estate’s value.
In addition, because probate is a public court proceeding, your Will becomes part of the public record upon your death, allowing everyone to see the contents of your estate, who your beneficiaries are, and what they will receive. Unfortunately, it’s not uncommon for scammers to use this information to try to take advantage of young or vulnerable beneficiaries who just inherited money from you.
A Will Does Not Apply to All of Your Assets or All of Your Needs
Although movies make it seem like you can and should leave all your property to your loved ones through your Will, a Will actually only covers certain items of your property, including any property owned solely in your name and any property that does not have a beneficiary designation.
A Will does not cover property co-owned by you with others listed as joint tenants or owned as marital property, meaning you can only give away your share of any property you own with others, not the entire property.
Any assets that have a beneficiary designation, like retirement accounts or life insurance, are not controlled by your Will at all but will instead be paid out to the person listed as your beneficiary on each account. Because of this, it is especially important to make sure your account beneficiaries are up to date.
In addition, a Will has no power until you die, so you cannot use it to give someone you trust the power to make decisions for you if you are incapacitated due to illness or injury. Even if you named someone in your Will to manage your estate or watch over your children, that person will have no authority to do so while you are alive.
Do Not Just Get a Will, Get an Estate Plan
With all the issues that using only a Will for estate planning can create, you might be wondering why a Will is even used at all. The thing is, a Will is not the one-and-done solution that most people are led to believe by TV shows and even some lawyers.
Instead, a Will should be used as a piece of your overall estate plan, not as the entire plan itself. Ideally, your Will should not even need to be used at all.
How can that be? Well, an estate plan is not just one or two documents – it is a range of tools and coordinated planning that makes sure everything and everyone you love is taken care of.
By using better tools like a Revocable Living Trust instead of a Will as your main tool for estate planning, you can direct what happens to your property while avoiding probate court entirely and ensuring the people you trust can step in and manage your assets immediately if you become incapacitated because of an illness or injury.
In addition, any assets you put in the name of your Trust are entirely private, meaning the court and the public will never know what you own or who will inherit it after you are gone.
When using a Trust-based estate plan, you will still have a Will, but your Will should only need to serve as a backup and safety net to make sure that any assets that are accidentally left out of your Trust at your death are added back into your Trust.
Importantly, you should also create an inventory of your assets so your family knows what you have, where it is, and how to find it when you become incapacitated or die. Without an inventory of your assets, your family will be literally lost when something happens to you. A comprehensive inventory updated throughout your lifetime is a critical, and often overlooked, piece of an estate plan that is not “just a Will”.
We're Here to Help!
If you are ready to see how having an estate plan for your family is different than having “just a Will,” schedule a free initial consultation with us today. We do not just create documents – we guide you and your family through every step of the process, now and in the future.