A Will Does Not Cover All of Your Assets
Advertisements and public campaigns about making a Will can make it seem like a Will can take care of all of your needs and all of your assets after you’ve died. In reality, a Will only covers certain items of your property, including any property owned solely in your name and any property that doesn’t have a beneficiary designation. That means a Will does not control property co-owned by you with others listed as joint tenants or owned as marital property with a spouse, meaning you can only give away your share of any property you own with others, not the entire property.
Assets such as retirement accounts and life insurance policies that have beneficiary designations are not controlled by your Will at all but will instead be paid out directly to the person listed as your beneficiary on each account. Because of this, it’s especially important to make sure your account beneficiaries are up to date. And, that you have backup designations in case your chosen beneficiary isn’t living at the time of your death.
Even if your Will states that you want your wishes to apply to all of your assets, the wishes in your Will are always trumped by beneficiary designations and co-ownership laws.
A Will Does Nothing For Your If You Become Incapacitated
Since your Will doesn’t have any authority until after you’ve died, you can’t use it to give someone you trust the power to make decisions for you if you’re incapacitated due to illness or injury. An incapacity can occur as a result of a car accident, an injury sustained while playing with your softball league, or due to an illness, and may be temporary or permanent.
Tasks like paying your bills, managing your money, and maintaining your home may all require help if you become incapacitated. Likewise, you’ll need someone who can make medical decisions for you if you’re unconscious or unable to communicate your medical choices effectively, such as if you’re in an induced coma in the hospital or have memory problems due to an injury or degenerative condition.
Unfortunately, the people named in your Will have no authority to make decisions for you or act on your behalf while you're alive unless you’ve given them that power through a separate Power of Attorney. Without it, your loved ones may need to go through a court guardianship process to gain the authority to take care of you and your home.
A Will Must Be Filed in Court to Be Used
One of the biggest estate planning myths I hear from clients is the belief that by having a Will, their loved ones won’t need to go to court after they die.
Sadly, this is the opposite of the truth.
A Will only has the authority to control your assets and represent your decisions when it is filed under a probate case in court after your death. If you named someone in your Will to manage your estate or watch over your children, that person will have no authority to do so while you’re alive.
Your chosen representatives can only begin the process of managing your assets and following the wishes you’ve left in your Will only after a judge or court commissioner has formally given them the power. While court oversight can be helpful if there is any confusion or disagreement about your estate, the probate process can be long and expensive. Often, the process can take 12 - 18 months or sometimes even longer.
Due to the length and complexity of the process, going through probate can easily cost your family tens of thousands of dollars. Some states even require that probate cost a certain percentage of your estate’s value.
In addition, because probate is a public court proceeding, your Will becomes part of the public record upon your death, allowing everyone to see the contents of your estate, who your beneficiaries are, and what they’ll receive. Unfortunately, it’s not uncommon for scammers to use this information to try to take advantage of young or vulnerable beneficiaries who just inherited money from you.
A Will is Not an Estate Plan
Organizations often promote a message of the importance of creating a Will because a Will is a tool that most people have heard of and are familiar with, which makes it an easy launching point to talk about the importance of planning for your assets and your loved ones. But the thing is, a Will isn’t the one-and-done solution that most people are led to believe.
The terms “Will” and “estate plan” are often used interchangeably to mean a tool for dispersing your assets and protecting your wishes, but these two terms are not the same. In reality, a Will is just one piece of your overall estate plan, not the entire plan itself. An estate plan isn’t just one or two documents - it’s a range of strategic decisions about the allocation and title of your assets, and it’s a set of tools and counseling-oriented planning that make sure everything and everyone you love is taken care of both while you’re alive and after you’re gone.
Your complete estate plan may include a Will, a Trust, Powers of Attorney, and other tools that are tailored to your specific situation, local laws, and your vision for the future.
And even more important than both a Will and a Trust, is an inventory of your assets so your family knows what you have, where it is, and how to find it when you become incapacitated or die. Without an inventory of your assets, your family will be lost when something happens to you. A comprehensive inventory updated throughout your lifetime is a critical, and often overlooked, piece of an estate plan that is just a Will.
Trusted Guidance and Counseling
An online program may be able to give you a legally valid Will or other legal documents, but just because something is legally valid doesn’t mean it will be effective. And any document created through a 20-minute online tool is almost guaranteed not to work for you and your loved ones when they need it.
If you’re ready to see how having an estate plan created for your family with heart-forward professional guidance is different than just creating a Will online, schedule your Family Wealth Planning Session™ today. During the session, we’ll review an inventory of everything you have and everyone you love, and together look at what would happen to your possessions and loved ones when something does happen. Then, I’ll help you develop a plan that works exactly as you want it - at your budget and with your vision - to make sure your loved ones are taken care of when you can’t be there.
Most importantly, any document created using an online tool will lack the knowledge, guidance, and personal counseling of a trusted expert who knows your situation and cares about your plan's effectiveness. That’s why I don’t just create documents - I guide you and your family through every step of the process, now and at the time of your passing. I even help all of my clients pass on something more valuable than their money - their values, stories, and wisdom - through a Family Legacy Interview.
To get clarity on what you and the people you love truly need, click this link to Schedule a 15-minute call or request information about estate planning so you can take the first step toward your Family Wealth Planning Session™ today.
This article is a service of family trust lawyer Stuart Williams and the Family Wills & Trusts law firm of Lansing. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.
