What is a Will?
A will is a legal document that directs the disposition of your personal possessions and designates guardians for your minor children. It becomes effective upon your death and usually is probated through the courts.
Consider the following when creating a will:
- Who will be the executor? This will be your personal representative who handles your estate. The executor is responsible for managing your assets, paying off your debts, and distributing your assets according to the stipulations in your will.
- Who will be the guardian for your minor dependents and what financial arrangements are needed for their care? See Guardianship for Children for more information.
What are your assets? Your will should detail any items that you wish to be inherited by a specific individual or charity. These can include items from a baseball card collection, specific pieces of jewelry, and furniture to art, homes, and property.
- Who are your beneficiaries? The individuals or organizations that will inherit your property.
What is Probate?
Probate is the process by which your will is “proved” through the court system. Your executor files papers with the court and provides it with a list of your assets, debts, and beneficiaries listed in your will. Your estate is kept in probate until the executor has paid your debts and distributed your bequests and assets to the people and organizations mentioned in the will. Once the final transfer of assets is complete, the will is “out of probate.” Probate can take several months to many years, depending on the complexity of the estate.
- It is possible to structure your estate to avoid probate. Consult with your estate and tax advisors to find out how and if it is right for you.
Do all my assets get distributed through my will?
No. Some assets, such as retirement accounts (401(k), 403(b), and pension benefits) and life insurance policies do not get distributed through a will. These assets are distributed to the beneficiary or beneficiaries you designated for the account or life insurance policy. It is important that you designate a beneficiary for these accounts and policies, even if that person is mentioned in your will. If you have not designated a beneficiary, assets will be distributed based upon the account custodian’s established rules and may not go to the person you want to receive the money.