When Do I Need a Will?
Many people mistakenly believe that they do not need a Will unless they are wealthy, own real estate, or are elderly. The fallacy is that everyone needs estate planning, which takes into consideration many issues, including the ultimate disposition of your assets.
Creating a Will is generally one part of the estate planning process. The Will is your opportunity to set forth your intent and desires regarding who is to receive your property after your death. An estate plan will coordinate the disposition of your probate assets (those controlled by your Will) and non-probate assets (those that pass directly to designated beneficiaries). The estate planning process will take into consideration whether there are likely to be federal estate or state inheritance tax due, how the taxes and other expenses will be paid, and special circumstances which may exist.
Your Will can also address other important issues, such as, who will raise your minor children and who will be your Executor, the individual responsible for administering your estate and distributing your assets as directed in the will. For additional information on the Executor’s responsibilities see Estate Administration.
Elder Law expands the traditional estate planning process to include consideration of long-term care planning and public benefits (Medicaid, Medicare and Social Security). Not every older person needs intensive Elder Law planning. However, Elder Law issues may affect the decisions you make regarding the disposition of your assets and the necessity of appointing a surrogate decision-maker for financial and medical matters.
ESTATE PLANNING PROCESS
An experienced estate planning attorney can guide you through the process of making all the decisions to properly structure your estate plan and create the necessary documents to implement that plan. Generally, it is helpful to prepare a list of all your assets before the first meeting with your attorney. Check on this link for a helpful form.
Other than your assets, you need to think about who you want to administer your estate. The personal representative is called an “Executor” if appointed in the Will. This is the individual who is responsible to identify your assets, pay your final bills, debts and expenses, file income, estate and inheritance taxes and then distribute your remaining assets as outlined in your Will.
If you have young children, under the age of eighteen (18) years, you should consider appointing a guardian of the person. This is the individual that will serve as a substitute parent and decide where your child or children will live, go to school, etc. For many parents, this is the most difficult decision they will face. Often, both parents cannot agree on who should serve as the guardian. An experienced estate planning attorney will provide valuable assistance with this discussion and decision.
Many people are reluctant to begin the estate planning process, because they think their situation is too complex or difficult to resolve. There are many different tools or mechanisms available to address every conceivable situation. Some are infrequently used and therefore not very well known. An important part of the initial conference with your attorney is the identification of your particular issues and concerns.
“Non-probate assets are not taxable.”
Frequently, people believe that only probate assets are subject to estate or inheritance taxes. Unfortunately, this is not the case. Adding the names of children or relatives to accounts or assets can have many ramifications and should NOT be done without a complete consideration of all the consequences.
“It is best to add the name of a child to my accounts”
The conventional wisdom, particularly after the death of a spouse, is that it is prudent to add a trusted child’s name to your bank account. This arrangement, which is encouraged by many bankers, is generally done in response to the desire that the trusted child have access to your funds to pay bills or other expenses if you are indisposed. What most people do not realize is that there are better ways to achieve this goal without many negative consequences. Before adding the name of anyone to your accounts or property, you need to fully understand all of the ramifications of doing so.
“I do not need a Will, because my spouse will get everything”
Many people mistakenly believe that their spouse is automatically entitled to their estate. Although this is frequently the result because both names are on all assets, intestate law in Pennsylvania specifically requires the surviving spouse to share part of the estate with the decedent’s children. What the children are entitled to inherit depends upon the number of children and the size of the estate. Problems can arise if the surviving spouse is not the parent of the deceased spouse’s children or if there is animosity between the surviving spouse and a child or children.