No one truly wants to think about death, especially their own. But for senior citizens, coming to terms with this reality becomes essential, especially when it comes to distributing their estate and seeing final wishes honored. Drafting a last will and testament permits individuals to officially determine who receives assets after death. Sadly, a loved one or close relative passing away without a will can cause disagreements and divisions among family members and gives the state the right to determine how assets are ultimately disbursed.
Creating a will provides sole comprehensive discretion over any decisions regarding personal belongings – such as vehicles, family heirlooms, investments, or other financial interests. A will allows for complete control over personal affairs, even after the time of death.
Laws regarding wills and estates differ from state to state. Generally, if someone dies and leaves a surviving spouse and children, the assets will be distributed between them. If the decedent was single with no heirs, the state would likely make final decisions about which relatives will inherit which portions of the estate.
Essential Reasons for a Last Will and Testament
- Having a will in place is crucial for those with minor children, as wills are the most effective method for assigning guardianship of minors.
- A will is also useful for those with a trust, a legal instrument that permits an individual to set conditions for how assets are distributed after death. A trust also works to minimize gift and estate taxes. But even if a trust is in place, a will is necessary as not all assets are dealt with under the trust. A trust addresses specific items such as life insurance or real estate, but not the totality of your assets.
- A revocable living trust allows a person to include most of their assets, but a “pour-over” will is still needed. These wills name guardians for children and guarantee that all assets meant to be put in the trust are included even if not re-titled.
- A will permits an individual to direct assets toward charitable institutions or organizations.
Reviewing and Updating the Document
Drafting an original will is a necessary first step, but the document needs occasional revision to reflect certain life events. Experts recommend setting aside one day each year to review insurance policies, investments, and legal documents such as your will. Establishing an annual day to review everything at once ensures that nothing is overlooked or forgotten.
Here are some life changes to consider when reviewing your will:
- Changes in Relationships: A marriage, divorce, or the birth of a baby can change beneficiary status. Death of loved ones previously named may also change the document.
- New Memberships: Individuals may wish to include contributions to their new church or a volunteer organization they recently joined.
- Change in Assets: The totality of assets being passed down to family members – including cash in the bank, portfolio investments, or valuable heirlooms – may have increased or decreased, or disbursement may need to be adjusted.
- Relocation: Estate laws vary from state to state. If there has been a move and the individual wants to ensure original intentions are honored, the will should be reviewed.
- Changes in Tax Status: Federal and state tax laws constantly evolve, so an attorney or estate planner should review the will on a regular basis to advise of any changes and how they affect disbursement.
Important Caveat: This blog is not intended to replace professional financial or legal advice. Seniors or their family members should consult with an attorney or financial planner regarding the specifics of drafting a will or discuss any other legal estate matters.
A Banyan Residence is an assisted living and memory care residence located in Venice, Florida.