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When most people think about estate planning, the first type of document that probably comes to mind is a will—and for good reason. Wills are generally the centerpiece of an estate plan, allowing people to direct how their property should be divided and who should get it after they die.
Anyone can create a will with a relatively inexpensive online estate planning service, if there are significant assets or a complicated plan for dividing your property, you can pay an attorney several thousand dollars to draft one. In either case, it’s money well spent.
A will is the most basic estate planning document there is—and for some people, it represents the only estate planning they want or need to do. But it’s important to understand what a will is and what it does (and doesn’t) cover.
In a will, you can specify:
However, a will alone may not be sufficient to meet everyone’s’ needs if they:
For those with such concerns, they should consider setting up a trust instead of—or in addition to—a will. Trusts are explained in more detail below.
A will is not a one-size-fits-all document, and when it comes to preparing one there are some very specific things to consider. Of primary concern are the following three provisions:
1. Name a personal representative or executor.
In an individual will, you can name a person or institution to act as personal representative, called an executor in some states, who’ll be responsible for ensuring that the will is carried out as written and that the property is divvied up and distributed as directed. It’s also wise to name an alternate in case the first choice is unable or unwilling to act.
2. Name beneficiaries to get specific property.
Your will can specify separate gifts of property—called specific bequests—including cash, personal property or real estate. Likely
beneficiaries for such bequests are children and other relatives, but they may also include friends, business associates, charities or other organizations.
3. Specify alternate beneficiaries.
In fashioning their wills, most people assume that the beneficiaries they name will survive to take the property they’ve specified for them. The most thoughtful wills provide for what should happen if those beneficiaries don’t survive—either by naming a backup recipient or indicating that the person’s spouse or children should take the property instead.
After completing the checklist above, here are the next items of importance when planning your will.
If you have opted to make specific bequests of property, a will is also the place to name people or organizations to take whatever property is left over. This property is usually called a “residuary estate.”
If you want assets divided among children, charities, or other beneficiaries, the will should note precisely what property is included in that pool. It should also specify whether assets are to go directly to beneficiaries or whether they’re to be sold and the value divided among the beneficiaries, either equally or according to stated percentages.
Business assets are often separate from personal assets—and most business owners have very specific ideas about what should be done with them after their deaths. If you don’t have a written plan covering the windup of your business, you should see an experienced estate planning attorney to ensure that your wishes are clearly indicated in your will.
The will should spell out your wishes regarding how to settle debts and final expenses, such as funeral and probate costs, as well as any estate and inheritance taxes. Usually a specific source, such as a bank account, will be tagged to cover these costs.
A nice added touch is that people making wills can use the documents to relieve those who owed them money from the responsibility of paying that debt—along with any interest that accumulated on it—to them or their survivors.
If you name someone to keep your house, you should list any specific instructions for its care and upkeep.
Since the law considers pets to be property, the best way to assure a good home for yours is to leave the animal to someone named in the will who has agreed to give it a good home. Many people also leave that person an amount of money to help cover the caretaking expenses.
When you contact our Milwaukee area law firm, your case will be treated like a unique request for assistance.