Anyone with personal or financial assets should consider preparing a will that outlines their desired asset distribution after passing away. However, less than half of Americans have a will prepared, which can lead to long, complicated legal processes.
Fortunately, writing a will can be a relatively straightforward process, and you aren't required to work with a lawyer. But before you begin writing your will, there are a few things to consider. We'll explain some of the most important things to know when making a will.
Writing your own will requires some preparation ahead of time. Getting organized will streamline the process and ensure you don't miss any crucial steps. Read on for a few critical things to consider when writing a will.
One of the most important parts of will preparation is identifying what assets you have that you want to include in your will. Although you don't have to include every single item you own, you should consider adding things like property, cars, collections, valuables, family heirlooms, and money in savings, investments, or retirement accounts.
Depending on the assets you wish to pass down, you may need to gather specific paperwork. For example, if you intend to leave your house or car to a family member, you'll need the property deed or vehicle title to transfer the asset legally. If you pass away and those documents aren't included in your will, the chosen heir may not be able to receive the asset.
Many people choose to leave their assets to their surviving spouse or children. However, any person or entity can receive your assets, as long as it's stated in the will. So, for example, if you have an extensive investment portfolio, you could appoint a family member to sell off the assets and donate the money to your preferred charity.
After writing your will, you need to assign an executor to oversee the distribution of your assets. Often, a family member will assume the role of will executor, but you can also appoint a lawyer or third-party individual. If you don't appoint someone, an individual needs to get permission from a probate court to handle your estate.
Writing your own will is only legal if you sign the document and have two witnesses give their signatures. Before preparing a will, consider who you'll ask to serve as a witness. A witness must be at least 18 years old and cannot have a direct interest in the will. People who could witness a will include friends, co-workers, a lawyer, or a medical professional.
Once you've made decisions around heirs, asset distribution, and witnesses, you can begin drafting your will. Here are some of the things that should be included in your will:
Your personal information should always be included in a will, even if your family members know that you prepared it. Be sure to include your full legal name, home address, and date of birth. You don't need to include your Social Security Number in your will.
In order for your heirs (also called beneficiaries) to receive your assets, you need to include their names in your will. List each person separately, along with their legal name, address, date of birth, your relationship to them, and what assets you're passing down to them.
In the beginning sections of your will, you should add the name of your appointed executor and their relationship to you. You can also choose to appoint more than one executor if the original executor passes away or decides they don't want the job.
If you have young children, it's imperative to name legal guardians in your will. Your surviving spouse would become the legal guardian in most cases, but succession laws are different in every state. If you pass away and don't name legal guardians in your will, the probate court may assign a guardian, and it may not be the ideal person in your mind.
Life insurance can't be added to your will or estate plan. Wills and life insurance are two separate things. When you pass away, your designated beneficiary will receive the death benefit, which is theirs to keep, distribute, or use to pay for end-of-life expenses (or anything else).
If you don't already have life insurance, it's good to purchase a policy while you're in the throes of estate planning. Ethos offers several different types of life insurance, and most applicants aren't required to complete a medical exam (simply answer a few health questions).
The information and content provided herein is for informational purposes only, and it is not to be considered legal, tax, investment, or financial advice, recommendation, or endorsement. You should consult with an attorney or other professional to determine what may be best for your individual needs.