As of 2021, 2 out of every 3 Americans still do not have a will. This stat is alarming, as it also means that 66 percent of people will have their estates settled by the law regardless of the wishes of the individual or their family.
The purpose of a will is to take care of your family and loved ones in the event of the unthinkable happening. The last thing you will want is to legally or financially burden your family in the middle of their grieving the loss of a deeply loved one.
Death is never a comfortable topic to consider or discuss, but it is a critical one. It is a small price to pay for peace of mind for you and those you love. It is also important not to delay in getting your will set up, as it is not the type of thing that you can wait doing until it is needed.
Setting up your will requires an understanding of the different procedures involved. It also involves careful decision-making based on several factors.
Understand Your Assets
What is an asset? An asset is anything that you own that has financial value. From a diamond ring to an investment account – these are all assets that have a monetary value.
You can also hold assets in many ways:
- Jointly with right of survivorship (JWROS) – This is the legal arrangement where more than one person owns an asset. When one of the owners passes, the ownership transfers to the other respective owners.
- Tenants-in-Common (TIC) – TIC refers specifically to property or land ownership. Like JWROS, it involves transferring ownership between TICs in the event of one of the owners’ death.
- Beneficiary Designation – This involves who will receive the assets in your life insurance and retirement funds in the event of your demise.
Who Will Inherit Your Assets?
The more time, research, and diligence you spend on getting your affairs in order now, the less those who will inherit your assets will have to worry or struggle. A written will should leave no ambiguity about who is to receive what in the event of your passing. It should offer clarity and peace of mind knowing that you are planning for the inevitable. This may include some family members not receiving any inheritance at all. It may also include some receiving more than others. The reasons you choose are up to you, and your will ensures that your reasons are respected and executed from a legal standpoint.
Life insurance and Your Will Complement Each other
Life insurance and your will are not to be considered separately. They are both critical and often overlooked steps you can take to ensure your family is taken care of and should be considered with a professional life insurance advisor. Both of these precautions can:
- Further increase the amount of inheritance paid out to your inheritors
- Prepare for the unexpected
- Be used to support charities
What Are Some Obstacles that Can Affect Your Will?
A few factors will need to be considered when creating your will and if your will is already made. One of the most common factors is a change in marital status. Whether getting legally married or common-law, it will affect your will and who will receive what. Other factors that can affect your will also include owning your own business or being a part of a complicated family structure. Therefore, it is essential to keep your will updated consistently to anticipate and incorporate changes such as those listed.
It is vital that you do your research and due diligence in understanding wills and the various factors that play into writing one. However, it is also essential to seek professional advice once you have reviewed your circumstances and decided you are ready to set your family up for the future. Remember, a will is not something that you can buy when you need it. By that point, it will already be too late.