Posted in Triplett & Carothers on July 1, 2021
If you don’t have a will or trust, and you don’t have a spouse or children at the time of your death, who gets your assets? The answer varies from state to state, but usually, they go to your “first-degree relatives” — that is, your surviving parents and/or siblings. If you don’t have any first-degree relatives, then nieces, nephews or cousins may come into the picture.
Fifty-five percent of Americans are intestate at the time of their death, meaning they have no will. For them, the discussion ends there. Their estate goes to probate court, taxes and fees are removed, and then their surviving first-degree relatives get the balance, divided up according to state law. But you don’t have to go with the state’s recommendation; if no one depends on you financially, you can do anything you want with your money.
Here are some points to consider when drafting your will:
- Wills save money. You can expect your estate to spend more time in probate if you die without an up-to-date will because it will take the court a while to locate all your assets. That means more court fees — good for the lawyers, bad for your heirs. So even if you decide to divide the estate up exactly as state law recommends, a will is still good to have.
- Living wills save trouble. A living will designates the person with the power to make medical decisions for you if you’re ever unable to. Choose someone who lives near you, who knows you well, and whose judgment you trust.
- Equal shares aren’t always the fairest way. It’s easy to say that you love all your siblings equally and that the only fair way to divide your estate is to sell all your possessions and give each sibling an equal share of the proceeds. However, that would give your heirs nothing except cash to remember you by. It’s also perfectly fair to give your heirs unequal shares based on their income and expenses. Maybe your brother the childless doctor in Ottumwa, Iowa, needs less money than does your sister the single mother of three living paycheck to paycheck in the Bay Area. It’s your money, so that determination is completely up to you.
- Don’t forget your friends. If you’ve lived on your own for a while, you know that family is what you make it. Remember that you can include close friends as well as family in your will.
- Consider charity. If you have a particular charity where you volunteer or one that you’ve always admired, consider leaving a legacy to it. That way, you’ll know your money is going to a good cause.
Estate planning can fall by the wayside if you don’t have any family you particularly need to provide for. But that’s exactly when it’s most important. Start planning today to ensure that you have power over the distribution of your assets.