What is a will? This a legal document that states who will get all of your assets upon your death. Without this document, and without an executor (or the individual to execute your wishes) the choice will be left up to the courts. An administrator assigned by a probate court will get to decide where the assets will go.
Death is devastating for your loved ones, no matter when or how it occurs. If you do not have a will established, you will have nothing that states who gets all of your assets. You could potentially leave your family scrambling at the time of your death. It could double the amount of pain for your loved ones and possibly cause more family stress.
Let’s examine what kinds of wills there are, and how to make a will. This way we can avoid potential unnecessary issues down the line.
Different Types of Wills
There are several different types of wills you can make that serve different purposes. Be sure to consider all of the available choices when starting your estate plan. Here are some examples of the most common types of wills.
A testamentary will, also known as the last will and testament, is most would consider being the traditional will. It is a legal document that details how to transfer all of your assets to your beneficiaries after death. Testamentary wills can outline who the executor is, who will be the primary caregiver upon your death and set up trusts for beneficiaries.
Anyone of age and is of sound mind can create a testamentary will, however, a few things need to occur in conjunction. In order for this to be considered valid, you must include the appropriate language specifying who is writing the will and revoking all other wills. Lastly, it must be signed.
Most people suggest to have a professional review your will to ensure it meets state law, and that everything is written precisely how you would like your wishes to be fulfilled.
A holographic will is a testator-signed handwritten document that has certain restrictions in order to be considered valid. Some states have restrictions on holographic wills. For instance, it must be proven that the testator wrote the will and was of sound mind at the time of conception, then it must contain the wishes to distribute personal assets to the beneficiaries.
Holographic wills do not need to be notarized or witnessed, which could pose issues down the line in probate court. These types of wills require the testator’s signature in an effort to stop any potential fraud. In some cases, it may be hard to prove that the signature is legitimate if not legible. The testator must write legibly for the signature, and also must explicitly lay out all assets and personal properties and list the beneficiaries.
An oral will is a will that is not written down, but spoken verbally only. The intent of this type of will is that the last wishes of the dying are hopefully carried out. This is the case if no other wills were written down. This type of will is sometimes not taken to be valid, depending on which state you are in.
Some states only recognize oral wills in certain circumstances. Whether it be someone in a dangerous situation like active duty in the armed forces, or someone who had just fallen ill suddenly. There could be a limit on the value set by the state. On top of that, they can demand only allowing any personal property to be included in the oral will, but not real property.
Proving an oral will may be very difficult, especially if those who could potentially inherit assets contest the instructions of that type of will. Also, if the individual is at a higher risk of death, it may be difficult to meet the requirements of an oral will.
In order to have a pour-over will, you must also have established a trust, as they work in conjunction with each other. The biggest difference from other wills is that the main beneficiary here is the testator’s living trust. When you use a trust in your estate plan, it is imperative that you have a pour-over will as well. Especially if you want assets directed to the correct beneficiaries (if certain assets were not in the trust).
A pour-over will cover assets that have not been transferred to the trust at that point. Upon your death, your individual remaining assets will be automatically transferred to an already established trust. Without a pour-over will providing explicit instructions, any assets would be subjected to the laws of intestate succession and could be distributed against your wishes.
A mutual will is a type of will that typically a married or a committed couple would create. This type of will is created jointly by the couple and is legally binding as such, rather than individually. In the case of the death of one party, the living partner would be legally bound by the terms of the will.
You would write a mutual will if you wish to ensure that your assets are successfully passed to your children, instead of your living spouse’s potential new partner. If you want to ensure that your assets are distributed to your children, you would need a mutual will to potentially avoid your assets going to an unintended person.
How To Make A Will
There are a few options you can proceed with to create a will: you can create one for free on your own, work with an attorney, or use an online service. These methods all have benefits or disadvantages associated with them. Let’s compare and contrast each of the different methods to see which one could work for you.
Make Your Own Will For Free
You can create your will online simply through a number of free websites that will guide you through all of the steps. This is one avenue to go down if you do not feel like paying for professional advice, you have a simple will, or if you do not feel like working through an attorney.
Why should I use this method?
- Simple distribution plan for all of your assets
- Modest estate with only one or a couple of beneficiaries
- Wish to establish a will without paying any fees for an attorney
Work With An Attorney
Up to a particular point, an online free method for creating a will could work for you and your family. However, at a certain stage, it gets more complicated or complex and could require professional assistance. Working with an attorney is suggested, especially if you have multiple larger assets or higher net worth.
Why should I use this method?
- Wish to have a legal professional update document as needed
- Ensure that your documentation complies with any state laws
- Have a more complex estate to pass onto beneficiaries
Use An Online Service
There are a number of online services that can provide a similar service that a lawyer might also do. An example of a more affordable service would be something like Trust & Will. You may like the idea of assistance in planning your estate and creating a will, but do not want the potential large fees that come with attorneys, this option could be for you.
Why should I use this method?
- Desire professional advice at a fraction of the potential cost of an attorney
- Hands-on approach through the process of making a will to ensure that all information is accounted for and correct
|Making a Will||Estimated Cost|
|Make Your Own Will||Free|
|Hire An Attorney||Could be a flat fee, or an hourly fee based on the size of the estate and the attorney you are working with|
|Use An Online Estate Planner||Trust and Will pricing for example starts at $89|
Will vs Trust?
A trust is a fiduciary agreement where a trustee, a separate party, holds the assets on account of the beneficiaries. A trust can specify when and how the assets will be distributed to the beneficiaries. This can be set up in many different ways. A living trust doesn’t pass through a probate court, so you avoid all of the court and attorney fees. If you have a trust, you can pass your assets directly to your identified beneficiaries. There is a caveat though, trusts tend to be more costly to create and maintain than wills do.
Wills allow you to direct where you want your assets and property to go upon your death. Will designate what assets go to which beneficiary, and can appoint a guardian if your children are not of age. Whether you choose to create a will, a trust, or both, getting some professional assistance from a financial advisor may be the best option for you.