According to Gallup’s latest polling, only 46% of adults in the U.S. have a Last Will & Testament that describes how they want their assets distributed after their death. If you’re among the 50%-plus without a Will, you run the risk that your estate will end up in probate court. Probate court is a long, costly process for your loved ones to navigate as they grieve.
Why Is A Will Is So Important?
Your Will ensures all of your assets are distributed according to your wishes. Without one, the court will decide how your assets will be divided. Perhaps even more important, if you’re a single parent with young children when you pass away, a Will enables you to choose their guardian. Otherwise your children’s guardianship will be determined in family court.
Keep in mind – a Will only covers property that’s subject to probate under your state’s law. Assets that fall outside of probate and require naming a beneficiary are not subject to probate court. This includes your FERS or CSRS annuity, FEGLI Life Insurance and Thrift Savings Plan (TSP). That’s why it’s important to update all of your federal beneficiary forms.
“Generally, a trust explains how you want money held in the trust to be spent during your lifetime and, when you pass away, it directs how you want money in the trust to be distributed.”
Other Estate Planning Tools In Addition To A Will
Set Up A Trust: From reducing estate taxes to avoiding probate court, a trust can be set up to achieve different goals. Generally, a trust explains how you want money held in the trust to be spent during your lifetime and, when you pass away, it directs how you want money in the trust to be distributed.
Advance Health Care Directives: Though the title of this type of document may vary from state to state, Advance Healthcare Directives specify your wishes for your medical care or end-of-life treatment. Check your state law for specifics on these types of documents:
- Living Will
- Durable Power of Attorney for Health Care (also known as Medical Power of Attorney or Health Care Power of Attorney)
- Designation of Health Care Surrogate, or Health Care Proxy
- Advance Directive – combines a Living Will and Power of Attorney for Healthcare
Durable Power Of Attorney: Since a General Power-of-Attorney is void when you become incapacitated, a Durable Power Of Attorney enables you to name someone who can make decisions about your property, finances, investments, paying your bills, and sign documents on your behalf, until you’re able to do so yourself.
It’s important to regularly review your Will and other estate documents to make sure they’re still in line with your wishes.
